With help from Eli Lilly, TVM pushes its build-to-buy fund to $201M

Closely allied with Eli Lilly ($LLY), TVM Capital Life Sciences has bumped up its latest fund past the $200 million mark with plans to bankroll up to 15 build-to-buy drug development projects.

TVM initially unveiled its TVM Life Science Ventures VII back in 2012 when Lilly and others had stepped in to finance the early-stage R&D operation. Eli Lilly set up a division of its supposedly lean-and-mean R&D arm of Chorus in Montreal with an eye to collaborating on the drugs that TVM was scouting in the biopharma industry.

That kind of build-to-buy strategy has been gaining traction in the U.S. venture community, which has been drawn by a model that promises some nice multiples in a relatively short time frame for assets which they control.

Like Avalon in San Diego, Atlas in Boston and Versant in Montreal, San Diego and Vancouver--each in their own way--TVM brings in early-stage projects, finances their drive to proof-of-concept data and then looks for industry players to acquire them and carry them forward. In Avalon's case, GlaxoSmithKline agreed to commit up to $495 million to launch 10 new biotechs, with first dibs on the drugs that are being developed. This kind of low-budget incubation plan is producing dozens of new single-project biotech's in a popular new approach to company creation--though many may not have very long lives or gain much of a reputation.

In addition to Eli Lilly, Business Development Bank of Canada, the Minnesota Life Insurance Company, CD Venture and FondAction invested in the fund, which also drew support from other pharma operations, including Bukwang Pharma of South Korea.

TVM's Dr. Luc Marengere

"The fund's first investments, including Kaneq Bioscience, GLWL Research, Ixchelsis, PRCL Research, and FAAH Pharma, showcase the fund's strength in identifying innovative therapies, funding them, and advancing them through this innovative model," said Dr. Luc Marengere, a managing partner of the venture group. "Through TVM Life Science Ventures VII, important new treatment options for patients are progressing for disease areas such as Type 2 diabetes, men's health, inflammation, and pain. The fund targets a total of 12 to 15 project-focused-companies and four to five traditional, syndicated venture investments."

- here's the release

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