Following the announcement from Vesalius Biocapital we spoke to Marc Lohrmann, Venture Partner, to get a better understanding of who they are, what they're focused on and their plans for the future.
1. For our community members who may not be fully aware of Vesalius Biocapital, what is your focus as a venture capital investor and what makes you different?
We have been operating for over 12 years and have since raised more than EUR 275m for three funds under the Vesalius Biocapital brand. In this time, we have had the honour of being chosen as a partner for growth by entrepreneurs who have had a transformative effect on European healthcare. This new fund enables us to continue our work supporting the best companies. We are very excited about the levels of innovation we are seeing and have already made investments in promising companies. We look forward to continuing our investment approach from past years and invest in cutting edge companies addressing an unmet medical & market need, with great management teams, to create successful companies by backing them for the long-term.
2. You just announced the final close of EUR 120 million Fund, Vesalius BioCapital III. What’s been key to your success with raising this new investment?
The fund is a validation of Vesalius’ proven approach to invest in later-stage European life sciences companies, providing capital to support their development. We believe this record fundraise for Vesalius Biocapital was based on our previous track record, the investment scope of our third fund and the fact that knowledgeable return investors as well as first time backers (such as the European investment Fund (EIF)) decided for our approach towards the appealing life sciences market in Europe. The EIF is backed by the European Investment Bank, the European Union, represented by the European Commission, and a range of public and private banks and financial institutions. To have them invest 30 million euros in our latest round is a strong validation of our strategy and a valuable sign of approval.
3. What’s your investment strategy with this new fund? Are there any areas you are particularly interested in compared with your previous funds or expect to make up more of this fund's portfolio?
Vesalius Biocapital III will target later-stage European life science companies in drug development, medtech & diagnostics and digital health with the goal of investing in 10-15 companies over the lifetime of the fund. We always try to syndicate with our peer investors and work closely with management teams to build value in these companies. We focus on companies in Europe that already have or are close to regulatory approvals in the major markets, having commercial traction and a global business model; furthermore, we concentrate on B2B products, so addressing unmet medical and market needs.
4. How do you see the health of the European biotech sector as a whole?
Europe has witnessed an exciting period of growth and global interest in its biotech sector. There is a global recognition of the R&D capabilities and synergistic development in life sciences and technology, which has created a growing number of attractive opportunities for investors. Life sciences and biotech in particular have a strong R&D base in their valuations (compared to other major countries such as US). There is still a shortage in private VC money in the life sciences and that is why we try to forge partnerships with governmental equity schemes (like the Portuguese National Promotional Bank and the European Investment Bank) or similar initiatives to create consortia. One aspect that still needs improvement is syndication. By working with fellow venture funds, we are not only sensibly spreading the risk, but also building valuable networks to attract the best international talent and capital.
5. Where do you see the major opportunities in the next 12 months?
We see great opportunities in personalised cancer diagnostics & treatment as well as in late-stage orphan indications. We continue to look at health technology and digital health as growth areas, both especially as digital health continues to mature as a sector. In fact, digital health represents a growing portion of our later-stage European deal flow and we see appealing companies and concepts there.
Vesalius Biocapital III has executed three investments to date. One of the investments is in SWORD Health, a tech-enabled provider of physical therapy, pairing its AI-powered digital therapists with human clinical teams to recover patients faster and better. California VC firm Khosla Ventures led the subsequent financing round for SWORD Health earlier this year.
ABOUT VESALIUS BIOCAPITAL
Vesalius Biocapital III is a specialist life sciences venture capital fund and is in line with predecessor funds Vesalius Biocapital I and Vesalius Biocapital II, which have supported life sciences companies since 2007. Vesalius Biocapital I and II raised over EUR 150 million and contributed in the development of over 20 companies.
The investment portfolio is well balanced between drug development, medical device & diagnostics and digital health investments and committed to providing capital to science-backed innovation and ambitious entrepreneurs, with a strong focus on exit within five years.
The specialist team consists of seasoned life science professionals with healthcare industry, corporate finance and strategy consulting experience, supporting companies through their growth cycle. The team is based in Europe and explores investment opportunities and valuation potential for the portfolio.
Vesalius Biocapital III, launched in April 2017, announced a final close with EUR 120 million in commitments. The fund targets later-stage European life science companies in drug development, medtech, diagnostics and digital health. For more information please visit: https://www.vesaliusbiocapital-3.com