(Reuters) — Private equity firm Bain Capital LP said on Tuesday it had raised $720 million for its first investment fund focused exclusively on the life sciences sector.
The fund will give Bain the ammunition to focus on targeted investments at a time when the life sciences industry seeks more capital to fund its expansion.
“We are excited by some of the long-term secular trends in the life sciences space,” said Adam Koppel, a managing director at Bain Capital Life Sciences. “Big pharma is increasingly outsourcing R&D at the same time as many new technologies and treatments are being developed.”
Guided by a team of eight investment professionals, the new business will make investments of between $30 million and $70 million in public and private life sciences companies in areas ranging from medical devices to specialty pharmaceuticals to biotech.
The fund will target companies at several key stages of their life cycle, including raising funds for clinical trials, scaling up after receiving regulatory approval for their products, or pursuing turnarounds.
It will also partner with Bain Capital’s private equity funds to participate in leveraged buyouts.
With the exception of its private equity investments, the fund will not usually seek a controlling stake in the companies it invests in, but it will aim for board representation in its portfolio companies.
“We are not going to be activist investors, we are going to be more like what they call ‘constructivist’ investors who play an important role in companies’ strategic decisions,” said Jeff Schwartz, also a managing director at Bain Capital Life Sciences.
Bain Capital has already made two investments through the new fund, in publicly traded biotechnology company Dicerna Pharmaceuticals Inc (DRNA.O) and in privately held Solid Biosciences.
Both are development-stage companies that are aiming to treat rare diseases, among other conditions.
Based in Boston, Bain Capital is one of the largest alternative investment firms in the world, with around $75 billion of assets under management.
It has made a number of major investments in various areas of healthcare, including contract researcher Quintiles, behavioral health facility operator Acadia Healthcare Co Inc, and drugmaker QuVa Pharma.