Ebb & Flow
Private investors continued their love affair with the life sciences, as Alta Partners raised $475 million for two funds last week, and - in a slight change of direction - all of the money will go to the life sciences.
When the firm started marketing the funds last year, it had planned to raise a later-stage biotech fund and a diversified IT early-stage biotech fund. But based on the response from investors, Alta changed the planned diversified fund to an early- stage biotech fund, according to general partner Farah Champsi.
Alta raised $180 million for the early- stage fund - Alta California Partners IV - and $300 million for the later-stage fund - Alta BioPharma Partners III. That exceeded its original goal of $150 million for the former and $250 million for the latter. Alta now plans to raise a separate IT fund next year.
Having gotten a few portfolio companies through the IPO window didn't hurt Alta's marketing efforts. "It helped to have five IPOs that have priced," Champsi noted. These include ophthalmic play Eyetech (EYET), cardiovascular company Corgentech (CGTK), cancer and infectious disease company Xcyte (XYCT), allergy/autoimmune drug developer Dynavax (DNVX) and CNS play Renovis (RNVS).
Alta has four more companies in the IPO queue: cardio-pulmonary in-licensor CoTherix, CNS companies Memory and Corcept and cancer company Cytokinetics.
Alta received substantial participation from existing LPs such as the California Public Employees' Retirement System; TIAA-CREF; Teachers' Merchant Bank; clients of Shott Capital Management; Adams Street Partners; Auda Ventures; Commonfund Capital; Diamond Capital Management (agent for the Dow Employees' Pension Plan); FLAG Capital Management and OMERS. Alta now manages seven venture funds totaling more than $1.5 billion.
Indeed, VCs continued to put their money to work, with cancer companies doing especially well.
Eximias raised $63.5 million in a series D round co-led by Cross Atlantic Partners and Quaker BioVentures. The company expects to complete by year end enrollment of its Phase III trial of Thymitaq synthase inhibitor in liver cancer. Other investors included New Enterprise Associates; OrbiMed; Birchmere; Easton Hunt Capital; Cross Atlantic Capital; Pacific Rim Ventures; and Emerging Technology Partners. Ferghana Securities served as placement agent and advisor.
Salmedix raised $45 million in a series C round led by HIG Ventures. Other investors included OrbiMed; Easton Hunt; Hunt Ventures; Novo A/S; Quilvest Capital; Clariden Bank; InterWest; Versant; Alexandria Equities; CMEA; Delphi; ProQuest; Ventures West; Aberdare Partners; GeneChem; and BioFrontier Global Investment Partnership. The company's SDX-105 bendamustine alkylating agent is in Phase II/III testing