NovaQuest Capital Management is approaching a first close on its fourth fund on about $700 million and has boosted its target to $850 million, according to a person with knowledge of the fundraising.
Because of strong demand, the firm has increased the target from the original $750 million, the person said.
NovaQuest hit the market with Fund IV in the fall. Its previous fund closed on $460 million in October 2013. Atlantic-Pacific Capital is working as placement agent on Fund IV fundraising.
NovaQuest has an unusual strategy, providing capital to large, global biopharmaceutical companies that need help developing new drugs. The firm invests directly in the products being developed.
NovaQuest makes money from getting back its principal plus a profit, along with securing a drug royalty stream, Buyouts previously reported.
“Say you’re Eli Lilly, you have approvals (for a drug), and now you need to launch the product globally. That takes hundreds of millions of dollars. Sometimes this is where NovaQuest steps in and provides that capital,” a source told Buyouts in a prior interview.
Performance information was not available for NovaQuest’s prior funds.
The NovaQuest team began pursuing its strategy in 2000 as an investment group working at Quintiles Transnational Holdings. The firm’s founding partners are Ron Wooten, managing partner, John Bradley, senior partner, William Robb, partner and Jonathan Tunnicliffe, partner.
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