Varda raises $250 million at $1.6 billion valuation to scale orbital drug manufacturing

El Segundo-based orbital drug manufacturing startup Varda Space has secured $250 million in a Series D funding round, valuing the company at $1.6 billion, according to Reuters. This investment comes as Varda accelerates its missions to manufacture pharmaceuticals in microgravity. The Series D round, led by Lux Capital and Natural Capital, brings Varda's total funding raised to $598 million since its inception in 2021.

The company's CEO and co-founder, Will Bruey, along with Founders Fund partner Delian Asparouhov, have overseen the company's growth since its founding. Since 2023, Varda has deployed six missions to orbit using its W-Series capsule, with all but its fourth mission successfully returning to Earth. They plan to introduce a next-generation capsule in 2030.

This month, Varda will launch two capsules simultaneously on a SpaceX Falcon 9 rocket. These capsules will carry hypersonic research payloads for the Pentagon and commercial customers. Despite SpaceX's phasing out of Falcon rocket rideshare missions, Varda remains unaffected, with 28 launches booked through 2027 to 2029.

While orbital re-entries have attracted interest from the Pentagon's missile defense efforts, Varda has focused on pharmaceutical manufacturing. Around 70% of their payload customer base is government-based, with the rest being commercial pharmaceutical work. The company anticipates this proportion to shift gradually by 2032, reflecting their commitment to pharmaceuticals.

In August, Varda appointed biotechnology executive and Pfizer veteran Mikael Dolsten to its board. About 18% of the company's 275 employees have pharmaceutical backgrounds. Varda's latest capsules can orbit Earth for days, then re-enter at approximately 25 times the speed of sound, offering hypersonic research capabilities for the Pentagon.

The market for manufacturing in space is growing as the International Space Station nears its 2030 retirement, providing Varda with a key platform for research in various fields, including artificial organ growth and fiber optic cables.