Lilly Asia closes healthcare fund at $450m hard cap

The fundraising process took approximately two months and the vehicle – LAV Biosciences Fund IV – closed in February. It was substantially oversubscribed. US institutional investors account for the majority of the corpus, with the rest coming from Asia and the Middle East. San Francisco City & County Employees' Retirement System (SFERS) is a new LP in the fund, according to the pension fund's board meeting minutes.

LAV was established in 2008 as a corporate VC arm of global pharmaceutical firm Eli Lilly, focusing on life sciences investments in Asia, particularly China. In 2011, it became independent. Fund III closed in April 2015 at $300 million, with commitments from a mixture of sovereign wealth funds, fund-of-funds and family offices.

LAV invests in pharmaceuticals and biotechnology, medical technology, healthcare services and other life sciences projects. Most target companies are based in China, although the GP will consider US investments that are likely to have a significant impact on China's medical care market.

It typically commits $5-15 million per round. The larger corpus for Fund IV means LAV can deploy more capital in early and growth-stage deals. Recent investments from the fund include a participation in a $63 million round for US-based drug developer E-Scape Bio, which focuses on treatments for Alzheimer's disease.

Since Fund III, LAV has also pursued an incubation model whereby the GP launches new start-ups internally or backs entrepreneurs who join as venture partners. At present, LAV has five venture partners, two of whom have founded start-ups that have received funding from the GP.

For example, two Sino-US focused start-ups – Veritas Genetics and Just Biotherapeutics China – were co-founded by Jonathan Zhao, a venture partner who previously led Asia strategy for global pharmaceutical companies Amgen and Pfizer. Veritas secured $30 million in October of last year, while Just China raised a $57 million round led by Singapore's Temasek Holdings.

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• Topics
• Greater China
• Healthcare
• Fundraising
• Venture
• Technology
• China
• healthcare
• USA
• Growth capital
• Lilly Asia Ventures
• Venture