The biotech sector will grow over the long-term as more companies start up, hoping to treat and prevent diseases and other human conditions, Terry McGuire, co-founder and general partner of Polaris Venture Partners, told CNBC Wednesday.
Polaris invests in technology and life science companies from the initial seed phase to growth equity, McGuire said. "Growth equity is a great balance for the portfolio if you're going to take very early risks."
"It's been a tough decade to be a venture cap," he added.
Because of the excitement about social media companies, such as LinkedIn and Facebook, there is now "renewed hope."
But, the initial public offering market has not been as easily available for biotech companies lately, he added. "What happened is we have partners coming along, the major pharmaceuticals that are coming into these companies earlier than they did before becoming our partners, helping us develop those programs."
"From a liquidity perspective what we found is that M&A [mergers and acquisitions] sales to those companies is as good as it's ever been. There's been some remarkable transactions," McGuire explained.
In addition, even though the Food and Drug Administration does a good job at keeping good, safe drugs on the market the whole process of development is taking longer, he said. "I think from a biotechnology perspective that duration of that process is problematic."
For example, after the initial discovery of an interesting biology, such as a cell that could transform cancer, "it's likely to be up to a decade before that idea turns into a therapy, which ultimately turns into a product on the marketplace," McGuire concluded.
Follow Strategy Session on Twitter: @CNBCStrategy
Watch CNBC's "The Strategy Session" weekdays at Noon ET.