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This is Sarah, in for Chris again.
Cell and gene therapy: More private equity investors are finding creative ways to invest in one of the fastest-growing fields of medicine, and it seems to be paying off.
As of Friday, shares of Cryoport have soared 50-percent-plus since the supply chain specialist in cell and gene therapy unveiled an investment from Blackstone Tactical Opportunities, which will fund its second acquisition over the span of a few days.
From a private equity perspective, outsourced pharma services have long been an appealing place to park money. But with so much consolidation having already occurred within areas such as traditional CROs – or clinical research organizations – sponsors have increasingly sought to deploy capital in other niche verticals.
Enter cell and gene therapy: one of the most active areas of biopharma and pharma R&D in recent years. The industry is growing at a 50 percent CAGR.
For Blackstone, investing in Cryoport offered a means to ride that growth without taking on idiosyncratic risk. “It’s like being a barnacle on a rocket ship,” one source said.
Levine Leichtman Capital Partners has agreed to acquire Bighand from Bridgepoint Development Capital and minority co-investor LDC.
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Dyal Capital Partners is targeting $5 billion for a fifth minority capital offering but, if history is a guide, it is likely to bring in a lot more than that.
GP stakes funds, which acquire minority interests in private equity firms in exchange for a share of income, have emerged strongly in the past few years, amassing ever-larger dedicated pools. Dyal, along with Blackstone’s Strategic Capital and Goldman Sachs’ Petershill unit, dominate the space, assuming the bulk of capital raised and deals done.
Fund V will follow the PE-oriented approach of its two predecessors, the MSBI report said, with Dyal betting that managers will continue to see increased fund allocations from limited partners. It will also focus on diversifying the portfolio by strategy, vintage year and geography.
That’s it for today’s rundown.
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