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Evans: We are not turning our backs on biotech

Written by Tony Quested

Wednesday, 16 April 2008

Article Index Evans: We are not turning our backs on biotech Page 2 Page 1 of 2 In an exclusive interview with Business Weekly, Prof Sir Christopher Evans reveals some of his plans for the new Life Sciences investment house, Excalibur. Science svengali and founding father of the Cambridge biotech cluster, Sir Christopher Evans, has launched a new international investment house dedicated to medical sciences ventures. Excalibur has recently acquired the whole team and profitable business activities of Merchant Ventures, a VC and private equity specialist. All of the directors of the original Merlin and Merchant businesses have been retained and moved across to Excalibur. Excalibur will target aesthetics, diagnostics, medical devices, speciality pharmaceuticals, surgical equipment, healthcare services, medical supply chain, wellness and laboratory and hospital supplies. The venture will operate primarily in the UK and Europe identifying lower risk, high reward medical investment prospects but will also explore opportunities in Asia, Australia, and the Middle East. Key investors and stakeholders besides Sir Chris include Sir Tom Hunter’s West Coast Capital, Professor Jeremy Stone, chairman of Merchant Ventures, and Lloyds TSB. In an exclusive interview with Business Weekly, Sir Christopher revealed that Excalibur would initially aim to build two or three funds together totalling around £200 million over the next 18 months. “These will be a mixture of domestic UK and international investments,” he confided. “The first fundraisings will start this summer – a small, UK-focused medical science fund (under £100m) and a larger, international medical science fund (over £100m).  There may be another initiative in 2008 but I can’t reveal that just yet. “Merlin has already raised over £300m of co-investment for our companies over the last two years and we would expect those smaller fundraisings to continue in parallel to our new, larger fundraisings for new investments. “We are not turning our backs on biotech at all and will always be on the lookout for young, innovative bioscience companies. But we would rather bring some of these, via consolidation, into our existing or new investment platforms to accelerate everyone’s returns and not spend 10 or 11 years waiting and worrying. We certainly wouldn’t let any of the brilliant new medicines escape us unless it was absolutely unavoidable. “The fact is, we are being inundated with medical science projects from biotech and speciality pharma and medical devices through to clever new healthcare services, wellness and medical supplies businesses.  “There is still plenty of quality in Britain to go for but we have our own way of grabbing these opportunities and nurturing them to more international successes and making good returns faster.” Merlin Biosciences has made its name by delivering excellent yields faster for Life Sciences investors in its funds. Merlin still has cash left in its funds Merlin II and III but Sir Christopher said the residue was reserved for follow-on’s, acquisitions and mergers or new product in-licensing requirements by the existing portfolio companies. “We also have existing access to pools of capital for new medical science investments today but these are not arranged as a formal fund and will continue as co-investment monies even after fundraisings are completed,” he said. Sir Christopher said that many lessons had been learned over the years of operating largely in biotech. “Our third Merlin fund is showing a very healthy premium and we expect to return 50 per cent of the investment back to our LP’s in 2008 when we are still only half way through the Fund’s life. This is in stark contrast to the downward trend of the marketplace.  Prev - Next >>

 

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