Nextech Raises $34M For Oncology Drug Fund
By Jonathan Matsey - DowJones Newswires
Zurich, Switzerland, May 11, 2007
Swiss firm Nextech Ventures has had a EUR25 million ($33.8 million)first close on its second fund, which will be dedicated solely to oncology drugs, the firm told VentureWire. The new fund will target oncology therapeutics, focusing on companies beyond drug discovery, but needing capital for human trials, said Alfred Scheidegger, founding partner and chief executive of Nextech.
"We'll invest only if we have proof-of-concept in animals," Scheidegger said. "We will look to take the companies from preclinical development to Phase II, then sell them." All of the second fund's limited partners are Swiss and German individual investors, Scheidegger said, except for one undisclosed Swiss bank. "We don't have the required track record from the first fund yet for institutional investors," he said. "Early-stage investments in the life science field take many years. Institutions in Europe are still very much reluctant to invest in venture capital, with a new business concept on top of it."
[...]Nextech hired two new investors for the new fund: Partner Myoung-Ok Kwon in February and Investment Analyst Gabriele Campi in March. Nextech is not alone among health care investors trying to find a niche by concentrating on particular sectors. NeuroVentures Capital of Charlottesville, Va., raised a $16 million fund in 2001 for central nervous system investments and Ivy Capital Partners had a $25 million close in March on a potential $100 million fund for orthopedics companies.
With a laser-like focus on one industry sector, Scheidegger said that Nextech will be able to cultivate deeper relationships with the people at big pharma who could make portfolio exits happen. "It lets us tap the network into the companies who we believe will buy our companies," he said. "We can go faster by talking only to the oncology people."
Based in Zurich, Nextech was founded in 1999 with a CHF 70 million debut fund investing in the life sciences and, earlier, in IT. Scheidegger said that the first fund invested in fewer than 10 companies and has had one successful exit: Webwasher AG, a German developer of Internet filtering and security software, purchased by CyberGuard Corp. in 2004.