The Massachusetts biotech has remained well-funded despite shying away from venture capital investors and seeking funds from private investors.

Many VCs have lost interest in early-stage investing, but angels - individuals who invest their own money alone or in groups - are stepping up to fill the gap. Angels are an especially good fit for for biotech start-ups that don't want to cede control of their companies to VCs too early, if at all. In addition to bringing valuable cash, angels put less pressure on start-ups to achieve an exit within a given time frame than traditional venture investors, and are more willing to accept buyers that may not be the highest bidders but will nevertheless be good stewards for their assets. For their part, companies looking to angels must understand the goals of their potential backers, since these financiers are often motivated by philanthropy and personal interest in a disease.

Merck announced Dec.2 that it is acquiring privately-held SmartCells for the company's preclinical SmartInsulin diabetes program in a deal potentially worth as much as $500 million. The acquisition will help bolster sales of Merck's blockbuster diabetes drug Januvia.