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BioPacific to Make Cross-Border Angel Investments in Life Sciences
BioPacific Investors, an angel group comprised of experienced US investors and life science executives, has been formed to invest in US and European life science companies that plan to establish or expand their operations in China or other emerging markets in Asia. The group expects that its investments, which will range from $250,000 to $1 million, will usually be the first outside funding for a company.
BioPacific will seek opportunities in emerging life science and healthcare companies that are pre-venture capital or do not fit traditional funding models. Investments will be made in medical devices, diagnostics, tools and services, and drug development.
Each member of the BioPacific group is an accredited investor with life science experience. There are 35 investors already signed up, a number that is expected to grow to 50+ over time. The investors are a collection of high-net-worth individuals, CEOs of life science companies and venture capital firms. With their experience, BioPacific investors bring industry and scientific expertise to a portfolio company that improves its probability for success.
BioPacific anticipates its average commitment will be about $500,000. The group will make approximately four or five investments each year. The first investment has been identified and is expected to be announced before the end of the year.
According to Greg Scott, a co-founder of BioPacific, a typical investment for the group will be a Western life science company with a product that has reached proof of concept and that wants to establish its product in China or Asia. To be considered, the company should have a relatively short path to liquidity, probably three to five years. In many cases, the product will address an unmet medical need in China, such as liver or lung cancer..
“Companies need to be targeting China or other Asian markets as a strategic opportunity,” Scott declared. “If their only goal is to get their device manufactured in China, that doesn’t really count because they are trying to take advantage of a cost-benefit, but not really targeting the market.”
Regarding members, Scott said most of them will be individuals who are “check writers” that support the fundings, However, venture capital firms will also belong to the group, he added. “For venture capitalists, the benefit of joining BioPacific is seeing the deal flow and what’s coming down the pipeline in terms of interesting cross-border companies,” said Scott. “From our perspective, their membership gives us a fair bit of confidence that VCs will be there for a follow-on round down the line, when the companies are ready.”
BioPacific Investors is a not-for-profit organization. A for-profit LLC, comprised of the investors who choose to participate in the investments, will be formed to make each investment. The structure means a company will deal with only a single investor, the BioPacific LLC, rather than a collection of individuals.
BioPacific’s operating expenses will be covered by a group of sponsors that include Silicon Valley Bank and its China JV, SPD Silicon Valley Bank, the law firm Dorsey and Whitney, international insurance brokerage Hub International, BioWa, a California-based subsidiary of Kyowa Hakko Kirin Co., Ltd of Tokyo, and ChinaBio LLC, a consulting and advisory firm also founded by Scott.
Ann Gaddy, co-founder of BioPacific, has worked in life science angel investment for over 15 years, including as Managing Director with two previous groups. “With our experienced investors, and the enormous opportunity in China and Asia, it seemed like a perfect time to form a group with an investment plan like BioPacific’s,” commented Gaddy. “Angel investment is not well-established in China. We think we can help companies bring their products to a market that needs them.”
Disclosure: ChinaBio® Today is published by ChinaBio®.