CLEVELAND, Ohio — The number of Midwest health care startups receiving investments could set a record this year. However, the startups reported winning far fewer dollars in the first nine months of the year than in either 2008 or 2007.
Midwest health care startups reported $593.2 million in investments across 140 companies through the first three quarters of 2009, according to the BioEnterprise Midwest Health Care Venture Investment Report.  In terms of dollars, that was down 34 percent from $896.7 million in 2008 and 41 percent lower than $1 billion in 2007.
But as for companies receiving investments, that was up 24 percent from 113 at the same point in 2008 and up 35 percent from 104 in 2007.
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This year, investors are putting less money in health care companies in the region and nationwide as the investors try to deal with global financial crises and health care reform in the United States. Surprisingly, the number of Midwest companies receiving investments is on pace to set a record this year, BioEnterprise said in a written statement (pdf). So investors may be investing fewer dollars, but they’re spreading those dollars around more Midwest health care companies.
“Funding for health care is reduced due to the recession and concerns surrounding the impact of health care reform on innovation,” said Baiju R. Shah, president and CEO of BioEnterprise, the health care company developer in Northeast Ohio. “Given the broader environment, it is encouraging to see so many Midwest health care companies attracting capital.”
By sector, biopharmaceutical companies have received $295 million so far this year, medical device companies, $173 million, and health care software and service companies, $125 million, BioEnterprise reported.
Ohio leads the pack this year with $136.7 million going to 45 companies during the first nine months. Minnesota is next with $134 million to 16 companies. Last year at this time, Minnesota was leading with $289.9 million and 20 companies to Ohio’s $178 million and 37Â companies. Ohio and Minnesota regularly trade this lead.
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In the 10 Midwestern states and one region surveyed by BioEnterprise, Minneapolis, Minn., led the first nine months of the year with investments of $133.3 million in 15 companies. Detroit/Ann Arbor, Mich., was next with $70.8 million invested in eight companies, followed by Cincinnati, Ohio, with $69.4 million invested in seven companies.
At this time last year, Minneapolis also led with $289.9 million and 20 companies, followed by Cleveland (including Akron, Ohio) with investments of $152.4 million in 26 companies, and Pittsburgh, Pa., with $101.1 million invested in 12 companies.
