Helsinn is getting into the venture capital game. The cancer supportive care specialist has put up $50 million (€45 million) to place 10 to 15 bets on early-stage companies in the U.S., parts of Europe and Israel.
Lugano, Switzerland-based Helsinn is looking to back companies that overlap with its existing areas of expertise, putting developers of cancer therapeutics, diagnostics and supportive care products in its sights. The fund is targeting developers of drugs, medical devices and food supplements that have preclinical proof-of-concept data or, better yet, early clinical results.
This early-stage focus deliberately moves Helsinn into an area traditionally eschewed by its business development teams.
“We have been looking over the last 10, 15 years at a lot of opportunities in Phase II and Phase III. And we have discarded a lot of early stage, really early stage, opportunities,” Helsinn CEO Riccardo Braglia told FierceBiotech. “We think that potentially this was a mistake because some of them have performed very interestingly.”
Braglia and his colleagues started talking about the fund within their networks at the beginning of the year. These discussions have been the primary source of investment ideas to date. In the longer term, Helsinn will be more strategic--it is setting up a team in Monte Carlo and hiring consultants in Israel and Scandinavia to complement its existing scouts in the U.S., U.K. and France--but for now the informal approach is providing a steady stream of opportunities.
Helsinn has already looked over 45 potential investments, advancing to due diligence in six to seven cases. MEI Pharma ($MEIP) became the first company to receive investment in August, pocketing $5 million as part of a broader licensing deal for the oral histone deacetylase inhibitor pracinostat.
Now, Helsinn has taken the wraps off two more investments. Helsinn has joined Shire’s ($SHPG) Baxalta, ARCH Venture Partners, Canaan Partners and MD Anderson on the list of organizations to invest in Theraclone CEO Clifford Stocks’ immunotherapy startup OncoResponse. And it has put £2 million into U.K. molecular diagnostics player QuantuMDx, a company Braglia wants to help expand into cancer.
The hands-on approach Helsinn is taking at QuantuMDx is indicative of how Braglia plans to work with the fund’s portfolio companies. Helsinn wants to take a seat on the board or advisory board of its portfolio companies, and use this position to provide support to the management team, access to its network and other nonfinancial perks.
The fund is part of a period of broader changes at Helsinn, a 40-year-old, family-owned company that is expanding its pipeline and geographic scope. The aforementioned deal with MEI moved Helsinn beyond its traditional focus on drugs that address the complications of cancer, and into therapeutics that target tumors. And Helsinn has spent the past six months building out its U.S. oncology sales team, resulting in it having 70 people on the ground.
With the fund getting up to speed and pracinostat advancing toward Phase III, the flurry of activity is set to continue. Braglia expects to sign off on another investment in the coming weeks. And, if all goes to plan with the first, three-year phase of the investment fund, Helsinn will put more money into the vehicle down the line.