The Ever-Growing Landscape - PE/VC World of MedTech
As the month of April ends and the beginning of May ensues; not only are we looking at longer and sunnier days, but also more buoyancy within the PE & VC world of MedTech. This newsletter is going to look at 6 of the most intriguing plays in the market for me over, the last 30 days.
A New Dawn, A New Day, A New Fund
Roundtable Healthcare Partners has closed on its sixth private equity fund at $800MM. The initial fund began in 2002, when Roundtable closed its first fund for $400MM. Two decades later this $800MM compliments to Roundtables now committed capital of $3.65BN.
The real question we will all await to find out is where this capital will lead them to invest? The creation of the Fund VI has coincided with two promotions to Partner level; for Mr Akhtar who is focussed on Consumer Health & Pharmaceutical and also Mr Smith, who is specialised in Medical Product and Medical Device investments … perhaps that gives a sector hint over the diversification. But, combine this with the involvement of the ex-CEO of Advantice Health - a Health and Wellness Brand, Mr Connors, as now Managing Partner; leads one to assume that with his expertise in this arena, Consumer Health could be the core focus for this fund.[1]
Keep Your Eye On The Prize
I want to look at two very interesting stories within the Ophthalmology sector.
Gryphon & VIP
Gryphon Investors recently announced a partnership with Vision Innovation Partners, who are the leading platform for ophthalmology service providers in the Mid-Atlantic region. In the past five years they have acquired and successfully integrated 23 practices in the Mid-Atlantic region. This move by Gryphon suits their portfolio and investment mandate as they typically go for the lower-end segment of the middle market — a market segment that includes over 81,000 companies, excluding non-core divisions of major corporations. Moreover, within their Healthcare portfolio; one of their core sectors is … you guessed it … ophthalmology.
Vision Innovation Partners CEO Mike Dunn said “We are excited to partner with the team at Gryphon as we plan for long-term sustainable growth. Gryphon brings financial and operational resources that will allow us to build our brand for the future and provide our differentiated services to more patients.”[2]
Partners Group
Partners Group has agreed to make a significant investment into EyeCare Partners LLC. EyeCare Partners, founded in 2015, has an extensive network of full-scope medical optometry and ophthalmology practices, with over 450 locations across 13 states throughout the US. The Company employs over 500 optometrists and 85 ophthalmologists who, together with over 4,400 clinic staff, offer patients end-to-end services covering medical optometry, ophthalmology and sub-specialties, and vision correction products.
The main support function that Partners Group will provide Kelly McCrann’s team is through their organic and acquisition growth. Kelly also added that EyeCare Partners ‘’are thrilled to have found a long-term partner that shares our patient- and physician-centric outlook.’’[3]
Buy-Out Time
Last month I looked into the news that Merit Medical was weighing up an option of a complete buy-out. Well, this month it is time to look at a company that has completed such a move. ArchiMed has agreed to buy Natus Medical (NTUS) for $1.2B. This privatisation deal has given Natus Shareholders $33.50 in cash, which represents a 28.6% premium to the closing price. For shareholders looking at NTUS over the past year, admittedly they have not seen explosive returns on their investment however
However, this buy-out should lead to an impressive growth spurt for Natus; as ArchiMed is a solely focussed Healthcare Investment firm that has a strong track record of growth within their specialised vertical. For evidence… Look no further than their ‘Med II Funds’ first exit which recuperated a 6X return. Natus Medical will also be joining a strong portfolio in the MedTech space that operate in their specific therapy area, such as Ad-Tech which similarly operates in a neuro space. Watch this space! [4]
领英推荐
The Growth of India
Last month I wrote about Meril Life Sciences, the Indian domiciled Medical Device company, receiving a sizable investment from Warburg Pincus. Keeping in line with this, Medikabazaar, India’s largest B2B platform for healthcare procurement solutions, has announced a closure on a funding round which was worth $65MM.
Medikabazaar plans to use this round of funding for ‘’strengthening its technological capabilities. The start-up also has planned to use a portion of the funds raised in deepening its supply ecosystem and distribution channels which are driven digitally. The funds raised will also be used in increasing the digital operating capabilities with the aim to improve the efficiency of the healthcare sector in the country. The start-up also has planned to expand its operations around the world.’’[5]
One to Watch – Fosanis GmbH - MIKA App
I always like to end with a ‘’One to Watch’’ segment. Digital Health is a fascinating sector; that is seeing a lot of investment across the Board, from start-ups being founded to blue-chip organisations creating new divisions… e.g. Terumo Health Outcomes
This months spotlight is on Fosanis, which have recently announced they closed a Series A funding round worth a touch over ￡10MM. Co-led by Dr Gandolf Finke and Dr Jan Simon Raue, Fosanis is an evidence based digital cancer app aimed at empowering cancer patients. Their product Mika, aims to ‘’ bring back some of the control when guidance and support is most needed: straight after a cancer diagnosis and all the way through the therapy process.’’
‘’Mika aims to give personalised and comprehensive cancer therapy support, combining the latest in cancer research with 24/7 hands-on help wrapped up in an easy-to-handle digital tool.’’ Moreover, their clinical trials have yielded impressive results over a 12 week period, a reduction in fatigue of 23% was observed and a reduction in psychological distress of 42% after 12 weeks.
Below is a link to their website – please check them out!
Summary
I hope you have enjoyed my brief analysis of the last 30 days within the PE and VC space of MedTech. Please subscribe to this newsletter for the next monthly instalment. If you have any points of conversations, feel free to share.
Have I missed a major topic that you think I should cover next month? What do you think the landscape portrays for the future?
If you are in this space and you want to have a conversation with me, feel free to reach out via LinkedIn or to me at [email protected]
[1] https://www.finsmes.com/2022/05/rouldtable-healthcare-partners-closes-sixth-private-equity-fund-at-800m.html
[2] https://www.gryphon-inv.com/news-article/gryphon-investors-announces-partnership-with-vision-innovation-partners/
[3] https://www.partnersgroup.com/en/news-views/press-releases/investment-news/detail/article/partners-group-to-acquire-eyecare-partners-a-leading-us-medical-vision-services-provider-2/
[4] https://www.reuters.com/business/medical-device-maker-natus-go-private-12-bln-deal-2022-04-18/
[5] https://www.inventiva.co.in/startups/an-interesting-health-tech/