CTI Life Sciences Fund has become the latest among Canada’s small coterie of life sciences venture capital firms to raise a new fund to invest in the booming domestic sector.
CTI said Monday it has raised $100-million to officially launch its third venture capital fund, with a goal of securing $175-million. The firm, which typically funds preclinical and clinical-stage drug developers in Canada, is backed by the usual Quebec-based institutional investors that bankroll the domestic sector: Fonds de solidarité FTQ; Caisse de dépôt et placement du Québec; the Quebec government’s investing arm, Investissement Québec; Teralys Capital and BDC Capital. The 15-year-old venture capital firm also said it had appointed veteran industry executive Youssef Bennani as a managing partner.
CTI Managing Partner Shermaine Tilley said CTI, an early backer of Enobia Pharma and Zymeworks, is “targeting Canada broadly, U.S. and the EU at the moment” for the remaining $75-million.
Canadian institutional investors outside Quebec have been slow to embrace early-stage life sciences investing despite the sector’s outsized returns in the past few years, prior to a pullback in recent weeks.
But a trickle of domestic institutions have returned to the space. Pension giants Canada Pension Plan Investment Board and PSP Investments have both made sizable bets in foreign biotechs – and in the case of CPP, a single investment early last year in Fusion Pharmaceuticals prior to its summer IPO.
Royal Bank of Canada , meanwhile, has backed Lumira Ventures’ fourth fund targeting drug and medical technology developers in Canada and the US. That fund, which would be the largest biotech investing vehicle in Canada in two decades, is more than three-quarters of the way to its US$200-million goal.
BDC spinoff Amplitude Venture Capital is closing in on its C$200-million goal for its first stand-alone biotech fund after raising money from the same Quebec investors plus Vancouver City Savings Credit Union and Ontario Capital Growth Corp. Genesys Capital of Toronto is expected to launch its fourth fund later in the coming months, with a goal of raising $150-million.
San Francisco’s Versant Ventures, one of the leading foreign biotech investors in Canada, last month said it had raised US$950-million across three funds that will invest here, in the U.S. and Europe.
“Never has the life sciences industry been more critical to the health of both people and economies around the world,” Mr. Bennani said in a release. “As a result, we are seeing a real renaissance in investments in the space.”
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