Venture investor Foresite Capital closed a $450 million new fund, its largest ever, and is setting out to find the next generation of promising drug developers.
Foresite's latest raise follows a $300 million fund put together last year and a $100 million close in 2013. Since its foundation in 2011, Foresite has made bets on public and private companies alike, searching for "transformative products" in biotech and med tech, CEO Jim Tananbaum said.
The firm's portfolio is heavy on recent IPO successes, including immuno-oncology innovators Juno Therapeutics ($JUNO), Adaptimmune ($ADAP) and Bellicum Pharmaceuticals ($BLCM). On the private side, Foresite holds stakes in Intarcia Therapeutics, Aimmune Therapeutics and Tarsa Therapeutics.
Uniting each of Foresite's past investments is promising science with a clear path to market, Tananbaum said, and the firm plans to continue that tradition with its third fund.
"The healthcare sector is experiencing unprecedented innovation including leaps forward in our understanding of the biology of cancer and other diseases," Tananbaum said in a statement "We believe these advances along with insights in translational medicine will lead to better patient outcomes, lower costs and some of the most impactful medical solutions we've seen in decades."
Like many biotech VCs, Foresite has benefited from the virtuous cycle that has helped line the pockets of the industry's financiers. The still-thriving IPO market for life sciences companies has created an ever-present liquidity option for upstarts, while cheap debt and flowing cash have made larger drugmakers as acquisitive as ever. That environment presents investors ample opportunity to return profits to their limited partners and put together new funds, injecting more money into a system that is, at least for now, humming.
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