ElevateBio raises $525 million in funding from SoftBank, others

March 15 (Reuters) - ElevateBio said on Monday it has raised $525 million in new funding led by Matrix Capital Management, to help increase manufacturing capacity and also advance development of its cell and gene therapies.

The new financing, one of the bigger fund raises in the healthcare sector this year, also included investment from SoftBank Vision Fund 2, the cell and gene therapy developer said.

The company is the largest shareholder in cell therapy developer Allovir Inc, and its other portfolio companies include HighPassBio, which is also developing a treatment for leukemia patients.

ElevateBio is seeing demand for manufacturing services from both its portfolio companies, as well as from academic researchers and biotech companies, said co-founder and Chief Executive Officer David Hallal.

The funding comes as larger drugmakers work to build their own manufacturing plants for gene therapies, in a drive to better control production of the world’s priciest medicines.

Biogen Inc said earlier this month that it planned to spend $200 million to build a new gene therapy manufacturing facility.

“We do have a fundamental belief that a large percentage of innovation will keep coming through traditional academic or early-stage companies,” Hallal said.

These companies, however, “don’t necessarily have either the time, the capital or the talent, to accelerate their programs forward.”

As part of the series C funding round, ElevateBio said Karan Takhar, senior managing director at Matrix Capital Management and Deep Nishar, senior managing partner, SoftBank Investment Advisers, will join its board of directors. (Reporting by Manas Mishra in Bengaluru; Editing by Shailesh Kuber)