Wellington Partners: 210 million euros for new life sciences fund
Munich — Wellington Partners closed its fifth “Life Science Fund V” with 210 million euros at the end of July. Twice the size of its predecessor fund, making it the largest Liefe Science fund ever raised by the company. The investment strategy remains in place: Potential portfolio companies are start-ups from the biotech and medtech sectors.
The first closing of Life Science Fund IV took place at the end of 2012 in the amount of 70 million euros. In a difficult fundraising environment, the final closing in 2013 then reached 85 million euros. — Rainer Strohmenger, Managing Partner at Wellington Partners, and his team targeted drug-developing biotechnology companies with Life Science Fund IV only in exceptional cases. The focus was primarily on medical technology and diagnostics companies.
Whereas at that time around EUR 7 million to EUR 10 million were earmarked for investment in a company, the spread for the successor may be wider: EUR 2 million to EUR 20 million was issued as a target corridor at the end of July. In total, the portfolio is to be expanded by 15 to 20 companies. Geographically, the focus is as before on German-speaking Europe. However, investments in companies from other regions of the world are not excluded. The focus will again be somewhat broadened: New biotech platform technologies, new therapeutics and diagnostics, e‑health business models and medical technology ideas are all being considered.
For the current fund, Strohmenger and Managing Partner Regina Hodits (photo ) attracted new investors such as KfW Kapital, Talanx and UTIMCO, the A & M investment company of the University of Texas (USA). Many investors who had participated in the old funds also moved back in — including a number of family offices, the European Investment Fund and the European Investment Bank.
“We see clear opportunities for above-average returns through investments in pioneering European life sciences companies. Given the world-leading innovation ecosystem in Europe, especially in the German-speaking region, coupled with a lack of qualified financial investors in the European life sciences sector, we have already identified promising investment opportunities,” Hodits said.
“German institutional investors such as insurance companies are also increasingly investing in venture capital funds, and in the life sciences and healthcare sectors as well, as evidenced by Talanx’s investment in our new fund, for example. In Europe, and especially in Germany, there are a large number of attractive investment opportunities in the life sciences sector for which there is still not enough capital. Therefore, existing German funds can invest significantly more money in the local market than is available today, and there is definitely potential for new funds in some areas such as digital health.”
Wellington Partners’ successful exits include investments in Actelion (sale to Johnson & Johnson), Rigontec (sale to MSD), Symetis (sale to Boston Scientific) and Definiens, an informatics specialist for tissue sample analysis. Among the most recent investments are Iomx Therapeutics in Martinsried (see |transkript.de), Sphingotec (see |transkript.de) and Adrenomed (see |transkript.de) in Hennigsdorf as well as Snipr Biome in Copenhagen (see European Biotechnology).