More Money Moving Into the Medical Markets This March–March 2006 (March 17, 2006)

Twenty-seven venture capital investments have already been announced by health care companies this month, amounting to $485 million in total financing. An additional $50 million was raised in health care venture capital deals that have yet to be confirmed. Biopharmaceuticals accounted for the greatest amount of capital invested in one sector, and together with Biotechnology accounted for about 40% of the total funding. Pharmaceuticals, Biopharmaceuticals and Medical Devices each had six deals, the most announced in any single sector during the past two weeks.

Remarkably, with the largest round in the past two weeks, almost as much funding was raised in one Health Care Services deal as in three Pharmaceuticals deals. Take Care Health Centers, headquartered in Conshohocken, Pennsylvania, clinched a $77 million round led by Beecken Petty O'Keefe & Company. The company provides retail-based health care delivery in select markets of the United States, offering wellness screenings and vaccinations as well as the ability to address convenient common family illnesses, such as strep throat and urinary tract infections. The last time we recorded a retail-based health care provider announcing a venture round was in late 2004, when Minneapolis, Minnesota-based MinuteClinic secured a $15 million Series B from Bain Capital Partners and TGap Ventures.

With this funding, Take Care will continue expanding geographically into other markets, in partnership with leading retailers—including Rite Aid in Portland, Oregon and Osco Drug in Greater Kansas City, most recently. Its state-of-the-art neighborhood care centers, located inside high-traffic retail pharmacy stores, are staffed with highly trained and experienced Nurse Practitioners, who can prescribe medications in most states. The centers, which utilize technologies including a proprietary electronic medical record system and touch-screen sign-in kiosks, are open seven days a week with no appointment necessary and accept the majority of commercial insurance plans and HMOs, plus Medicare and Medicaid.

For the first two weeks of March, the five largest health care venture capital transactions taken together represent nearly half the total funding committed in this period. The other top deals announced between March 1 and March 15 are as follows: Santaris Pharma raised $48.6 million in a round led by ABN AMRO Capital Life Sciences; Helicos BioSciences raised $40 million in a round led by Flagship Ventures; InfaCare Pharmaceuticals raised $30 million in its Series A. led by Atlas Venture and Pequot Ventures; TransMedics raised $29.8 million in its Series C, led by 3i Group.

In fund news, last week Polaris Venture Partners announced the closing of Polaris Venture Partners V, as well as the appointment of four new general partners. The $1 billion diversified venture capital fund will be invested in life sciences, including biopharmaceuticals, drug delivery, services and consumer health products, as well as other communications and technology sectors. Headquartered in Waltham, Massachusetts, Polaris’ other portfolio investments include Aspect Medical Systems, Microbia and Momenta Pharmaceuticals.
 

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