The Innovation Fund was created in 2007 by Brigham and Womenâ€™s Hospital and Massachusetts General Hospital to address a growing unmet need for funding emerging technology in the capital gap between invention and product development.
The main objective of the fund is to accelerate to market technologies developed by Partners HealthCare investigators, thereby enhancing healthcare quality, cost and outcomes. Structured as a separate LLC entity, the $35M Fund is evergreen in design and will reinvest all gains from investments back into the Fund to create capital for additional investments.
Investment decision oversight is provided by an independent external committee composed of experts from industry, venture capital and academia.
The Fund operates on a venture capital model whereby opportunities are rigorously evaluated on the basis of scientific strength as well as potential for commercial success.
The Fund has four major goals:
* Capture more value from the PHS research portfolio by creating companies, technologies and solutions that advance and enhance healthcare. * Provide funding for technologies positioned in the capital gap between invention and clinical development. * By demonstrating institutional commitment, attract external capital that will leverage and encourage co-investment. * Generate a return on investment to refresh the fund and provide capital for additional technologies.
Gap Funding Over the last five to seven years, the environment for early-stage investing has undergone significant change. As a result of these changes, there is a dearth of funding support for technologies/companies positioned between invention and clinical development. By focusing on this capital gap, the Fund can advance technologies of high commercial potential and medical benefit to a stage where larger, more traditional investment sources are attracted to underwrite the risk.
Types of Fund Investments The Partners Innovation Fund will make two types of investments: Equity and Development.
Equity investments are seed and early financings that will catalyze company formation. These investments will often be a Series A stock and co-investors are frequently other early institutional investors, private investors or corporate investment funds.
Development investments precede company formation and are intended to validate technologies with a high potential for later commercialization by either new venture formation or out-licensing to an existing market player.
For all investments, funds will be reserved for participation in follow-on investments.
Innovation Fund Process
Utilizing a proven venture capital based diligence model, the team conducts in-depth diligence on all opportunities in two steps:
Initial Screening: Assesses opportunities for high commercial potential. Key project attributes are:
Product concept and value proposition
Evaluation and Investment Decision: During this step, PIF staff conducts extensive diligence to assess the strength of the proposed business in relation to our investment criteria. This process takes place over 3 to 6 months during which time we interact with technical and market experts, possible customers, competitors and potential co-investors as we prepare for presentation of the investment opportunity to our external Investment Committee for final approval.
The team will work with investigators and their advisors to develop a project or business plan including connections to potential entrepreneurs, advisors and investors in the venture, private or corporate arena.
Venture Launch / Ongoing Support: Once an investment has been approved, the Innovation Fund plays an active role in the ongoing development of the new venture. The team will work on all aspects required to move the new entity forward including recruiting senior management and staff, providing guidance and support in technology development, serving on the Board of Directors and working with management to achieve milestones.
|QPID Health||3/13||Series A||$4M||4|
|Annovation BioPharma||9/12||Series A||$8M||2|
|RaNA Therapeutics||1/12||Series A||$20.7M||3|
|Daktari Diagnostics||12/11||Venture Round||$10M||3|
|Daktari Diagnostics||10/09||Series A||$2.8M||6|