Healthcare-focused Essex Woodlands opens Shanghai office
Essex Woodlands, the Silicon Valley-based healthcare investor, has opened an office in Shanghai as it looks to deepen its exposure to one of China’s fastest-growing sectors. David Yang and Scott Barry, both managing directors with the firm, will run operations out of Shanghai.
Yang joined Essex Woodlands in April from Warburg Pincus, where he was participated in investments in CITIC Pharmaceuticals, Lepu Medical and Harbin Pharmaceuticals. He previously worked at McKinsey, Fidelity Investment and Morgan Stanley. Barry has been with Essex Woodlands for six years as a partner in the New York office.
The company targets pharmaceuticals, medical technology, healthcare services and information technology. Previous China investments include China Cord Blood - the blood banking operator that became a KKR portfolio company earlier this year - and cardiovascular stents manufacturer Microport Scientific. Essex Woodlands was the only US-based investor in the companies prior to their listings in New York and Hong Kong, respectively.
"China is an important geography for Essex Woodlands," Yang said in a statement. "Private equity investments in healthcare in China are increasing steadily, healthcare mergers and acquisitions are increasing, and healthcare IPOs are raising more capital in China than in the US today."
Essex Woodlands has $2.5 billion under management and is currently investing out of its eighth fund, which closed at $900 million in 2009. It primarily targets growth equity transactions, with a small amount of capital channeled into VC deals.
According to Deloitte, China's life sciences and healthcare market will become the second-largest in the world within a decade. Biotech output, meanwhile, is on course to reach RMB4 trillion ($630 billion), 90% of which will come from biopharma. PE and VC investment in pharma and biotech reached $953 million in 2011, up 31.6% from 2010. A total of $620 million was committed to eight deals in the first half of 2012.
Vivo Ventures closed its seventh healthcare-focused fund in January at $375 million. Up to $175 million of the corpus will be invested in Chinese firms.
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