INVESTING IN SCIENCE

For the Global Group’s Johnny Hon, biotech companies are at the cutting edge of medical research and can also offer big rewards for far-sighted investors

Whether they’re searching for a cure for cancer or a way to end the opioid epidemic in the US, biotech companies can be exciting and hugely rewarding investments—both in terms of financial reward and in the satisfaction of funding scientific advances that may help humanity.

But they’re not for the faint-hearted. Investing in the biotech sector is a highly specialised endeavour, as it can take a long time and a lot of money to develop a promising research idea into a treatment that can actually be used on people, with many hurdles to jump along the way and no guarantee that the research will lead to a viable treatment.

This can be daunting, but it is a world that Johnny Hon understands well. The chairman and founder of the Global Group has a doctorate in psychiatry from Cambridge University, where he specialised in dementia treatments, and has spent most of his career as a venture capitalist. This combination of expertise in science and finance is key to his understanding of the value of research and the process of advancing it to the point where there is a breakthrough and buyers come knocking.

“If you have a good product that’s looking for money, you often have to act very quickly in this market,” he says. “That can be difficult for investors who don’t have a good understanding of the science. But for us, one of the advantages is that if we like what we see, we can complete a deal within two weeks.”

Hon’s biotech investments are mostly conducted through a company called Mann Bioinvest on the Isle of Man, a self-governing British Crown dependency located in the Irish Sea between Great Britain and Ireland, of which he is co-chairman with Jim Mellon. The pair source research opportunities from their impressive roster of contacts and use the British capital markets to provide funding.

“We have the capital, we are FCA [Financial Conduct Authority] regulated in the UK, we can advise on the listing of the company and put the whole structure together,” says Hon.

His biotech investments in the UK are focused on cancer treatments, but he is also exploring new areas such as the potential to replace opioids with painkillers based on medicinal cannabis. With the drug now approved for medical uses in much of the developed world, Hon sees a big opportunity.

There is also crossover with some of his other investment activities. Blockchain technologies are already gaining traction in the financial sector, but they have the potential to securely store medical records and data as well, so there is an opportunity to act as a bridge between the worlds of biotech and fintech.

“What’s exciting about biotech, and what makes it different, is that you’re investing in the progress of science and humanity,” says Hon.