Big deal: Versant Ventures diagnoses $400m fund

Versant Ventures sources some of its deals through a drug discovery engine that commercialises research conducted at US and Canada-based universities.

Healthcare-focused VC firm Versant Ventures closed its sixth investment fund last week at a hard cap of $400m, with a third of that sum allocated towards the commercialisation of university research.

Versant Venture Capital VI was oversubscribed and featured both new and existing limited partners, including labour body investment arm Fonds de solidarité FTQ and Teralys Capital, backed by the governments of Canada and France, Northleaf Venture Catalyst Fund and HarbourVest Partners.

The fund hopes to invest in 20 to 25 biotechnology companies in the US, Canada and Europe, with initial commitments slated for the first quarter of 2017.

Versant, founded in 1999, now has $2.3bn under management and has celebrated 65 initial public offerings of portfolio companies to date. The firm has traditionally invested across the healthcare sector, with a focus on drug discovery and development.

With Fund VI, however, Versant is adjusting that focus to focus primarily on biotechnology companies as that part of its portfolio has proved increasingly successful.

The firm also operates, since 2011, a drug discovery engine through which Versant partners universities to identify promising research.

Currently, Versant is collaborating with more than 80 scientists through its engines Inception Sciences, based in Vancouver, Montreal and San Diego, Blueline Bioscience, based in Toronto, and Highline Therapeutics, based in New York, and has generated a host of spinouts. A third of the $400m will be allocated to the commercialisation of such research.

The firm also has plans to expand those collaborations into Europe.

Brad Bolzon, managing director at Versant, said: “We have grown the discovery engine network from a single San Diego facility in 2011 to five fully operating research sites that cover the west coast, the north east and Canada, and will soon extend to Europe.

“As a result of this expansion, we are better enabled to invest in breakthrough academic discoveries that can be translated into life-changing therapies for patients.”

Versant’s move bodes well for the continued success of technology transfer, which has just had a bumper year that began with the $57m collaborative fund Apollo Therapeutics and $70.7m UCL Technology Fund in January, featured a $90m extension for Cambridge Capital Innovation in August and ended with Oxford Sciences Innovation boosting its coffers to $730m in December.

Cedric Bisson, partner at Teralys and chairman of the Versant limited partner advisory committee, said: “We are very pleased with how effectively Versant has transformed a very differentiated investment strategy into a strong portfolio that is delivering top-tier financial performance.”

– This article first appeared on our sister site Global University Venturing.

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