New Forbion life sciences fund hits €470M

European life sciences venture capital firm Forbion, has announced the first €470M ($500M) close of its Forbion Growth Opportunities Fund II.

The fund will focus on investing in late-stage European life sciences companies.

The new fund has attracted several new institutional investors, including pension funds PME and PMT, the Ewing Marion Kauffman Foundation and Reggeborgh, who join returning investors Pantheon, Wealth Management Partners and Eli Lilly and Company.

The second fund will invest in mostly European, later-stage biopharma companies, developing novel therapies for areas of high medical need. 

The fund will target the segment with three strategies: providing private growth capital for mature clinical development-stage assets; furnishing pre-IPO funding to companies pursuing a public listing in the near-term; and injecting capital and hands-on capabilities to under-valued public companies. 

As a result, Forbion Growth Opportunities II aims to take leading positions with investment sizes of up to €70M ($74.9M) per deal. The team’s goal is to build a portfolio of 15 investments in the most promising late-stage European life sciences companies.

Forbion expects to reach its €600M ($642M) hard cap, completing the Forbion Growth Opportunities Fund II over the summer.

Sander Slootweg, managing partner and co-founder of Forbion said: “The European market for late stage, private life sciences investments is large and remains significantly underserved.”

Dirk Kersten, general partner, added: “In the past two years, we have successfully deployed Forbion Growth Opportunities Fund I, providing growth capital to a selected number of high-quality European life sciences companies.” 

Three strategies

Kersten told us the Growth Opportunities Fund focuses on three dedicated strategies. 

“The first is private growth capital, where we focus on providing growth capital for clinical stage development programs, the second is European cross over financing – these are mature European companies that require financing in preparation for a public listing, and third focus is on undervalued assets where financing is needed to complete development,” Kersten said. 

“Growth Fund I performed extremely well with a major highlight being Gyroscope – our portfolio company which is a company that uses gene therapy to treat eye diseases being sold to Novartis in under a year in a $1.5B deal.” 

When asked if the second fund will be a continuation of the first fund, or will have a different focus, Kersten said: “We believe that the strategy for the first Growth Opportunities Fund has proven to be very successful as demonstrated by the fast deployment and early exit.

“This has been recognized by several new institutional investors that decided to join the Growth Opportunities Fund II. The strategy will continue to focus on our three core areas: private growth capital, European cross over financing and undervalued assets.”  

Slootweg told us Forbion remains one of the most steadfast life sciences venture capital firms in the industry, and continues to be extremely attractive to institutional investors. 

“The growth fund specifically targets later-stage companies and as with all of our funds, we are positioned to follow through with our portfolio companies from the early-stages all the way through to public companies,” he said. 

Outlook

So what’s the outlook for the near future and long term, given a downturn in public markets?

Slootweg told us, “We are a fundamental investor and therefore not momentum driven. In each market environment we will be able to select the most promising companies for an investment that truly hold the potential to change medicine and positively impact patients’ lives. 

“We believe that in today’s market critical mass matters and that smaller VCs will experience more issues in raising new funds. In short, whilst the near-term prospects are not rosy especially for the public markets, the long-term prospects are positive for the industry, especially for the private markets.”