From IPO to Washington:

What planetary health investors can learn from biotech’s playbook – and vice versa

By Kyle Teamey and Peter Kolchinsky

PLANETARY HEALTH | BIOTECH | FINANCE

Photo by Tim Mossholder on Unsplash

March 9, 2026

Planetary health investing and biotech investing are more alike than most practitioners in either camp realize. Both fields deploy somewhat patient capital into science-intensive companies whose success depends on deep sector expertise, product-market fit, and rigorous, capital-efficient execution to profitability. 

Yet the two ecosystems have largely evolved in parallel, developing their own governance norms, financing conventions, and public-market strategies. That separation is a missed opportunity. 

Of the two, biotech is the older sibling. Born in 1976 with the founding of Genentech, the sector has seen over a thousand biotech companies go public over the last five decades and launched even more products in that time. The lessons that biotech has absorbed through multiple boom-and-bust cycles – particularly around boardroom discipline, when to go public, and policy risk – are directly transferable to planetary health. 

Over the past several years working together at RA Capital Management, we on the biotech and planetary health teams have compared notes on the similarities and differences of our respective markets. We outline here the most important areas of overlap and offer concrete recommendations for planetary health companies and investors who may want to learn from biotech’s growing pains. Along the way, we identified some lessons from planetary health that biotech teams could accept in-kind.

The shared foundations

At the most fundamental level, both biotech and planetary health demand sector expertise from their investors. Generalist venture capital approaches often struggle in either domain. The underlying science is complex, the regulatory landscapes are dense, and diligence requires an ability to evaluate technical risk that most investors simply do not possess. In both fields, capital deployed without deep domain knowledge is capital at risk of being wasted.

Both involve a rollercoaster ride even if the final destination is success, and investors without domain expertise, unable or unwilling to sort through the details of the countless problems that skilled teams must solve, tend to lose their nerve. Revenue-generating businesses make it comparatively easy to know when a company is succeeding, but companies that spend years in development require appropriate expertise.

Both sectors also share a hard truth: product-market fit matters more than technology, team, or anything else. Brilliant science that cannot find a market is an expensive hobby. Planetary health entrepreneurs and investors, like their biotech counterparts, must resist the temptation to fall in love with elegant technology and instead ask relentlessly whether a real customer will pay for this product at a price that sustains the business.

Finally, the ability to scale with capital efficiency is critical in both domains. Planetary ventures often face the same manufacturing and deployment challenges that biotech companies encounter in scaling from bench to bedside. Capital efficiency is not a nice-to-have; it is the difference between a profitable, impactful company and a zero.

Public markets: Rethink the timeline

Planetary health companies tend to assume they must wait until success is virtually proven and they are showing revenue growth before pursuing an IPO. Biotech offers a different perspective. You can go public much earlier than you realize. The conventional path – prove you will succeed, then use the IPO for growth capital and liquidity – is not the only option. An alternative is to pick a point at which you are ready to bet that you will succeed or die trying, raise the capital to get to that point with enough spare runway to raise again, and then execute in the public eye. (To be clear for planetary investors and entrepreneurs who have come to think of SPAC and IPO as being much the same, we are writing about traditional IPOs here and not SPACs. We will cover SPACs in detail in another article).

We often hear ​“make the IPO the last fundraise” from planetary health companies who assume they will never be able to raise again once they are publicly traded. While it’s a laudable goal to reach self-sufficiency and profitability with one round of funding, keep in mind that profitable public companies fundraise all the time. Being public makes it easier for a well-run company to fundraise. With that in mind, the size of the IPO must be sufficient to ensure the company can hit a value inflection point. Whether the value inflection point is profitability or something else, make sure it’s something valued by investors and there is sufficient runway to both hit the milestone(s) and raise again, if necessary. 

This reframing treats an IPO as a fundraising opportunity rather than solely as a path to liquidity. It is a meaningful distinction. Companies that approach the public markets as a capital-raising event rather than an exit event tend to make better decisions about timing, valuation, and especially investor selection. They expand their universe of potential investors by both committing to running a well-governed business in the public eye and showing that success comes with instant liquidity instead of – as would be the case if the company stayed private – another private financing that might result in a mark-up on paper but no chance to actually harvest gains. If the technology fails, you won’t need to dance around the issue of a downround or liquidation because the market will convey that quite clearly. But if there are merely stumbles along the way and the company needs more capital to work through issues, then the public markets will also tell you the price at which you can access capital at any given moment. That’s harder to do in the private markets given how most investors tend to hem and haw instead of just admitting that they won’t invest unless the company does a downround.

Critically, when you do go public, understand the process and run it yourself. Do not let investment bankers dictate the process or the allocation of shares. Your equity is valuable currency. Sell it to the investors you want to work with over the long term, not to whichever accounts the underwriters find most convenient to fill or want to curry favor with using your currency. There are investment banks with absolutely abysmal track records as lead left IPO underwriters; they have high rates of IPOs breaking deal price within days and generating negative returns over weeks and even months. This is a function of poor price discovery. A stock dropping and staying below IPO price soon after the IPO can be a lasting blemish on a company, both externally and internally. Employees who got re-upped with equity at the time of the IPO might fund their options underwater. 

Proper price discovery, starting with insiders, sets a company up for a successful transition. At RA Capital, we help our companies both select effective bankers and empower management teams to take the reins of their own IPO. The goal is not to have your stock pop 100% on the first day. Though that can happen for countless unforeseeable reasons, it usually happens on low volume that therefore doesn’t matter to anyone except day traders. The goal is to have your stock trade moderately but sustainably above deal price (e.g., +10 – 15%) after the IPO for as long as fundamentals and macro conditions remain about the same and certainly beyond the 6‑month lockup period. 

If insider-selling craters the stock after the lockup expires, it means that the IPO price discovery process failed to find a price that matched true demand to true supply; management will lose the trust of remaining shareholders, who will feel manipulated. Not a good start to any relationship. The way to avoid that is to raise your pre-IPO money from investors who are eager to invest more in the IPO and to price the IPO at levels where insiders indeed participate meaningfully and there is plenty of credible unfilled demand from new investors. That generally assures you that insiders won’t be selling at that price after the stock starts trading, even after the lockup expires, and even if there is some selling by minor shareholders, there will be excess demand to absorb those shares. If insiders aren’t selling at the IPO price and you’ve left some demand from new investors on the table, it’s much less likely that your stock will drop below IPO price (unless the the macro environment worsens or the company itself puts out bad news, either of which would have altered the company’s real valuation and funding prospects even if it had stayed private). 

COGS matter: Be mindful of gross margin from the start

The learning goes both ways. The biotech team at RA Capital credits our planetary health colleagues with teaching us that companies that don’t think about gross margins from the start, maybe because they are overly focused on proof of concept in the near term, have a harder time pivoting and getting to low COGS and higher throughput later. This can be a killer for a company selling products into commoditized markets, as is often the case in the planetary health sector. For example, any energy company ultimately has to compete with the price of power generated by every other energy company at the same or similar levelized cost of energy (LCOE). Therefore, planetary health investors and their companies have to care a lot about the gross margins of their products. 

Companies that don’t from the start will only end up having to re-engineer their technologies after proof-of-concept – or die trying. In healthcare, we’ve seen this play out too, largely on the medical device and diagnostics front. For example, a diagnostics company might show great data on a testing platform with high COGS. Later that same test might not perform well enough on a more efficient, high-throughput platform. Had the proof-of-concept work been done on the more efficient platform, those challenges would have become evident sooner.

Historically, biotech companies have gotten away with gross margin murder because the expectation of high net prices meant they could afford a lot of inefficiencies, including in manufacturing. But as landscapes become increasingly crowded and we tackle larger diseases like obesity and autoimmune disorders, planetary health’s COGS lesson is worth keeping in mind. For example, if the B‑cell depletion space gets crowded enough, price will matter. And that means COGS and manufacturing capacity will matter. Relatively few people in biotech have experience with caring about gross margins at the moment. Odds are we’ll find them in the generics and biosimilar spaces. We must assimilate their expertise into our novel product development companies. 

Board governance: Reclaim the hours

One of the most overlooked inefficiencies in both sectors is the sheer volume of time consumed by board meetings. Consider the arithmetic: across a portfolio of a thousand companies, each holding four board meetings per year, with an average duration of six hours – sometimes spanning two full days – the industry devotes an enormous share of its most senior talent’s time to governance. Shave just two hours off each meeting – which can be done without losing substance and arguably would preserve attention – and you recover roughly 8,000 hours per year of senior leadership bandwidth. Most board meetings can and should be compressed.

RA Capital has developed a set of best practices to make this possible, and planetary health boards should adopt them.

1. Know your core value proposition (CVP) and report on whether it is impaired. A CVP is what you said you would deliver to investors when you last raised capital and can include downstream value inflections. For example, ​“We are funded to deliver key derisking technical validation XYZ that should make it clear that we are best in class in our product category, which would then allow us to raise $100M to launch our product and reach profitability.” When reporting any news, board members are always wondering whether the CVP is impaired. If the answer is no, everyone can exhale and the meeting can be brief. If the answer is yes, then that impairment and key mitigation strategies immediately become the key issues – or the only issues – to discuss. Do not waste time arriving at the critical issue through forty slides of context.
2. Put the bottom line at the top of every slide. Imagine that the board member reading your deck reacts to each page, laden with information, scouring every line for hints of bad news, by asking, ​“So … are we screwed?” If the slide does not immediately answer that question, it needs to be rewritten. So a data rich slide might say ​“Our technology is meeting our expectations, our COGS might be lower than projected, and our CVP remains intact.” That’s great. A board member can absorb that and move on. Time is best spent on problems that jeopardize the CVP, not the things that are going smoothly.
3. Show the whole elephant in one glance. This means putting cash runway and key deliverables and anything else that truly matters on a single slide, what RA Capital calls an ​“Elephant Slide.” It’s a good forcing function for identifying what matters most, and therefore is strategically relevant. If a delay of one deliverable, such as manufacturing of a component, impairs the CVP, the Elephant Slide should reflect that clearly and state that as the bottom line at the top so no one overlooks the significance of the news. 
4. Write a tight cover letter with a clear agenda, highlighting what the board will be asked to decide, if anything. Before the meeting, distribute a concise letter that says exactly how things are going. It should answer the question every board member is thinking but may be too polite to ask: Is the CVP intact or are we in trouble? Is anything going better than expected? Any exciting new opportunities for value creation? Any risks on the horizon? Is the team humming or are there internal crises? What is management asking the board to decide? These are generally applicable questions but every company can customize its own (as long as they still cover the ones above); they are what all board members should be asking every time they think about the company, so just answer them upfront.
   
   If an issue is legally sensitive (e.g., IP), then fine not to put it into writing. If the board is not being asked to decide anything, then say that upfront and make it clear that this is just an update. Speak to what decisions are on the horizon that the board might want to war game so everyone is more decisive when decision-time comes.
   
   A tightly written cover letter puts all board members into a productive frame of mind for absorbing what’s in the slides and primes them to arrive at the board meeting ready for productive discussion. It also deals with the reality that board members are busy, sometimes stretched thin, and sets them up for success. Also, if management prepares a good cover letter and has the bottom line at the top of all slides and one director shows up unprepared, it’s a lot easier to recognize that the board member is likely the problem.
5. Start every board meeting with an executive session — allow an hour, which may be all you need. Put up the Elephant Slide and speak plainly. The cover letter and slides should be taken as read. But just in case anyone forgot what they read, it’s good practice to have a board member summarize what they understand the state of the company to be and state what decisions the board has to make in that meeting. Investors are often good at summarizing since they have a professional thesis for every company that takes into account everything that justifies their investment decision. From there, the goal is ultimately to proceed to a vibrant discussion, not a presentation. Everyone has a duty to say something if they see something. 

If the topic of the meeting is that the company has to raise more money to get to the next key inflection, then no sense dancing around that for the whole meeting; raise the issue and, if there are investors in the room, make it safe for them share their thinking on what it would take for their funds to participate. If investors on the board already know they will not participate in the next round, it’s in everyone’s interest for them to say so early. 

If there are topics that are uncomfortable to discuss in the subsequent open session, such as the possibility of a project being terminated and people being laid off, the CEO should offer that guidance to the board so no one slips (though ideally every executive team would be able to talk about such tough topics dispassionately). 

Some companies have a tight enough executive team that there’s nothing the CEO minds being said in executive session that the whole executive team that would normally be in open session can hear. That’s awesome. In that case, you can have everyone in executive session and, by the end of it, there may not even be a need for open session. There’s no rule that says that a board meeting can’t be as short as 30 – 60 minutes, bang out the key strategic issues, and agree to handle housekeeping votes by email. 

Ecosystem defense: Protect the narrative

Perhaps the most urgent lesson biotech can offer planetary health is about defending your ecosystem from public misunderstandings. Climate tech was popular with the public and policymakers – and then it wasn’t. The same pattern has played out in biotech. Public enthusiasm surged during Covid, capital flooded in, and then sentiment reversed and Congress passed price controls on some novel medicine classes in response to public outrage over drug prices. 

Biotech investors know this cycle intimately. They have a name for one version of it: the Massachusetts Paradox, named for the observation that Massachusetts, a state that leads the world in biomedical innovation, also has elected members in Congress leading the charge in calling for policies that would undermine the industry back home. It’s unimaginable that Michigan’s Senators would turn on the car industry or Iowa’s representatives would turn against farmers, but with little exception, public opinion in America is so anti-pharma that even in Massachusetts voters like to see their elected policymakers proposing bills (e.g., price controls on novel medicines) that would dismantle their own state’s economy.

The root of that particular misunderstanding stems from the biopharma community never quite making the case to the public for how essential insurance is for access to its miracle products. As an industry, when hearing people complain about drug prices, biopharma leaders tended not to pause to clarify that the audience was talking about prices charged to patients by insurance plans, not prices charged by companies to insurance plans. The public was calling for drug price controls but what it really needed was insurance reform to lower what plans could charge patients out of pocket for appropriately prescribed medicines they claimed to cover. 

Fixing the misunderstanding is now a priority for the biotechnology community, and members of the RA Capital team are at the forefront of that campaign. In 2020, we launched the non-profit No Patient Left Behind (NPLB) to inform the public and policymakers about the overlooked value of medicines and how to make them affordable through proper insurance, not price controls that would snuff out investment. We’ve written many letters to Washington and, as an indication of our community’s involvement, have seen the number of companies and investors signing on to those letters grow each year. NPLB has made an impact (e.g., the CBO changed how it does innovation math) but has more work to do to address the misguided antipathy and distrust that threatens biotech and public health. 

For those of us in planetary health, the misunderstandings we face are different (e.g., climate change as a hoax) but the lesson is clear: always market your value proposition and keep the public onside. 

Never assume that the public, policymakers, or even limited partners fully understand why your sector matters and whether it’s truly cost-effective. When public sentiment turns against innovation, the companies and investors who have invested in such ​“narrative resilience” will be the ones that survive.

Planetary health investors should be proactive about this. We must proactively build the case for our sector’s importance. We must explain the economics clearly. We must show the jobs, the cost savings, the avoided harm, the benefits to national security. Biotech is on its back foot at the very moment biology is unlocking so much medical potential. Planetary still has a chance to avoid that mistake and get ahead of any truly major sentiment shift. 

The planetary health community might consider what our motto is. Maybe it’s ​“No Externality Left Unpriced” or ​“Prosperity and Abundance”? Or maybe we need to workshop it a bit more. Who’s game?