Stephen M. Monroe, Partner
Gretchen S. Swanson, Associate Editor
800-248-1668
203-846-6800
Fax: 203-846-8300
pressreleases@levinassociates.com
Third Quarter Shows 30%
Increase In Health Care Venture Capital Raised, Healthcare Corporate Finance
News Reveals
NORWALK, CT—October 11, 2006—Total venture capital funding
raised by health care companies during third quarter 2006 increased by close
to 30%, compared with the year-ago quarter. In the three months ended
September 30, 2006, a total of 110 health care venture capital investments
with disclosed prices were confirmed, amounting to nearly $2.2 billion in
funding, according to Healthcare Corporate Finance News. Compared with the
second quarter 2006, however, dollar volume increased only slightly. Esprit
Pharmaceuticals announced the largest deal, a $91 million Series B
financing.
Health Care Venture Capital Investments
Third Quarter Ended September 30,
2006
Sector
Number of Deals
Dollar Amount (in millions)
Pharmaceuticals
19
$685.5
Biopharmaceuticals
22
$573.4
Medical Devices
35
$520.2
Biotechnology
19
$282.0
Other
10
$114.5
E-Health
5
$24.6
“This year may have the largest dollar amount of venture
capital invested in health care so far this decade,” noted Stephen M.
Monroe, Managing Editor. For the nine months ended September 30, 2006,
health care companies have already raised $6.39 billion, nearly the amount
raised in all of 2004.
Several deals were announced concurrently with a
licensing agreement, merger, acquisition, spin-out or product launch.
“Corporate investors are taking an increasingly active role in funding
start-up health care companies with late-stage product candidates, as well
as nurturing research and development companies that have strategic
potential,” commented Gretchen S. Swanson, Associate Editor. Corporations or
corporate venture capital affiliates that contributed to venture financings
during the third quarter include Roche Venture Fund, Teva Pharmaceuticals,
Novo Nordisk, MedImmune Ventures, Lilly Ventures and Novartis Bioventures.
In addition, Safeguard Scientific, Dow Chemical Company, Medtronic and
Johnson & Johnson Development Corporation invested.
Medical device companies accounted for the most deals (32%) during the three
months ended September 30, 2006, but pharmaceutical companies garnered the
greatest amount of funding (31%) in one sector. Biopharmaceutical deals
accounted for 26% of total dollars invested and 20% of the total number of
deals announced. Biotechnology and Pharmaceuticals were each responsible for
17% of the number deals announced, but the biotechnology deals only account
for 13% of the total funding for the quarter. Many of these companies are
developing protein-based therapeutics to address major unmet medical needs,
including cancer, inflammation and metabolic and autoimmune disorders, but a
few are targeting specialized indications.
The most active venture capital firms for the third quarter ended September
30, 2006 were led HBM Partners and Sofinnova Partners, which each
contributed to seven venture financings, followed by Bio*One Capital and
InterWest Partners, which each invested in six deals. New Enterprise
Associates, BA Venture Partners and Domain Associates also participated in
some of the largest rounds. Listed below are the top venture capital
investors in health care for the quarter, ranked by participation in number
of deals.
Third Quarter Ended September 30,
2006
Most Active
Venture Capital Firms
Number of
Investments
HBM Partners
7
Sofinnova Partners
7
Bio*One Capital
6
InterWest Partners
6
Domain Associates
5
Novo A/S
5
Charter Life Sciences
4
GIMV
4
Prospect Venture Partners
4
Skyline Ventures
4
SV Life Sciences
4
Three Arch Partners
4
TVM Capital
4
Venrock Associates
4
Versant Ventures
4
Alta Partners
4
3i Group
4
Healthcare Corporate Finance News (www.hcfnews.com)
reports weekly on financial events in the fast-paced venture capital,
private and public equity, and merger and acquisition markets for health
care companies, and provides subscribers with access to a searchable online
database of health care venture capital deals. This monthly newsletter and
weekly email update is published by Irving Levin Associates, Inc., a leading
financial publisher and source of market intelligence since 1948. For more
information, please call 1-800-248-1668.
Since 1948, Irving
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