Biogeneration Ventures (BGV) has raised €105M for its fourth early-stage biotech fund, which aims to team up with academic institutions across Europe to create medical biotech companies.
The fund, called BGV-IV, exceeded the amount the firm expected to raise. It attracted investors in previous funds back to the table such as the US big pharma Bristol Myers Squibb, Swiss private equity asset manager Schroder Adveq, and the European Investment Fund. It has also added new investors such as the European pension fund Industriens Pension and the German bank KfW.
BGV, which is based in Naarden in the Netherlands, focuses exclusively on early-stage investments and founding new companies, so the new fund is good news for startups and biotech entrepreneurs, who might be struggling to find investment right now. Although the fund was oversubscribed, the ‘hard cap’ on the fund is €125M so there is still space for new investors if there is interest.
While the fund is open to all therapy areas, “oncology, rare diseases, and autoimmune diseases are expected to be part of the new portfolio,” commented Edward van Wezel, Managing Partner at BGV.
The Covid-19 pandemic has ushered in a global recession, and there are signs that this will only get worse. That said, it seems that many biotech investors are realizing how valuable life science assets could be in the future and are investing accordingly. BGV is the second VC firm to close a large fund focused on Europe this past week, as the transatlantic VC Epidarex just closed a €112M fund, also specializing in healthcare.
In van Wezel’s experience, there hasn’t been a major impact of the global financial woes on European medical biotech investments. “Even in March, none of the parties expressed any second thoughts. In the last two months, our sector has rebounded quite significantly.”
Although BGV exclusively focuses on early-stage investments, it has had a partnership with another Dutch VC, Forbion, since 2006. This collaboration helps provide a bridge to support companies that are in later stages of development, as Forbion also invests in later-stage companies.
“We share infrastructure and we have a 20% overlap in our portfolio,” explained van Wezel. “Sometimes Forbion joins a syndicate in a second instance in one of our companies or they can pre-commit and then, based on certain milestones, invest.”
BGV has had successful previous funds, with two of its portfolio companies, cardiovascular disease-focused Dezima Pharma and oncology firm Acerta Pharma, being sold within three years for over €1B each. Dezima was acquired by Amgen for €1.4B in 2015, and Acerta by AstraZeneca in a €6.2B deal in 2016.
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