Gulf sovereign wealth funds are betting big on biotech – why?

QIA just backed Latigo Biotherapeutics’ $150 million Series B, meanwhile ADIA participated in Lila Sciences’ $200 million seed round. This isn’t just a passing interest – there’s a very clear pattern emerging across Gulf SWFs.

Author

Jamie Lane
March 21, 2025

Gulf sovereign wealth funds are continuing to lean hard into biotech.

The Qatar Investment Authority (QIA) just backed Latigo Biotherapeutics’ $150 million Series B, a U.S. startup working on non-opioid pain treatments. Meanwhile, the Abu Dhabi Investment Authority (ADIA) participated in Lila Sciences’ $200 million seed round, betting early on an AI-powered biotech innovating across life sciences, chemistry, and materials.

And this isn’t just a passing interest – there’s a very clear pattern emerging across Gulf SWFs.

  • Mubadala has made biotech a core focus, backing companies like Outpace Bio, Metsera, and Capstan Therapeutics. In fact, drug discovery has become its single largest investment sector, surpassing software, fintech, and even aerospace.

  • Oman’s OIA recently took part in the $140 million Series B for Tidal Vision, which develops sustainable biopolymers.

  • Saudi Arabia’s PIF isn’t just investing – it’s building. The launch of Lifera, a contract development and manufacturing organisation (CDMO), is a direct play at making the Kingdom a biopharma production hub.

So what’s actually happening here? Why are sovereign-backed funds, typically more comfortable with infrastructure and blue-chip assets, making big bets in one of the riskiest sectors in tech?

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Three overlapping forces are driving this play:

  1. Economic diversification is now a necessity. Biotech is being positioned alongside AI and clean energy as a pillar of post-oil strategy.

  2. Healthcare sovereignty is a priority. COVID-19 exposed the Gulf’s vulnerability to global supply chain disruptions, making regional pharma production a strategic goal.

  3. Biotech valuations have cooled. After peaking in 2021, the sector has seen a correction, allowing long-term investors to enter at more reasonable prices.

And then there’s the structural shift: SWFs are getting comfortable with risk. Mubadala Capital has led the way, but now QIA and ADIA are following suit—experimenting with venture-style investing, particularly in deep tech verticals where the upside (and time horizon) stretches beyond the typical SWF investment cycle.

But can they stomach the ride?

Biotech isn’t private equity. The R&D timelines are brutal, often 10+ years before a drug reaches the market. Regulatory hurdles are steep, and even the best-funded biotech startups can fail.

For now, SWFs are sticking to minority stakes, backing companies alongside specialist VCs and industry leaders.

But the real test will come when setbacks inevitably hit – because deploying capital is easy; waiting a decade for an FDA approval is potentially not.