Deerfield closes $840m fund

US-based healthcare-focused investment firm Deerfield Management yesterday closed a second academic research-focused Healthcare Innovations Fund sized at $840m  in collaboration with more than 15 unnamed universities.
Healthcare Innovations Fund II, whose limited partners were also unnamed, will seed spinouts in healthcare subsectors such as pharmaceuticals and medical devices.
In addition to the universities, it will also align to incubators run by two unspecified medical device developers.
The vehicle will operate from an innovation campus, The Cure, in New York City, and a large number of portfolio companies will be able to use the incubator’s wet and dry labs, engineering, computing and shared resources facilities.
The fund is more than 1.5 times larger than its $550m predecessor, raised in 2015 in partnership with institutions Princeton University and Northwestern University.
Other backers included cancer research centre Memorial Sloan Kettering, healthcare providers Seattle Children’s Hospital and New York-Presbyterian Hospital, and philanthropic investor Robert Wood Johnson Foundation.
The new fund is also eight-times bigger than the most recent Deerfield university fund announced in January 2020: a $130m fund with Weizmann Institute of Science commercialisation arm Yeda Research and Development.
Deerfield’s other academic funds include partnerships with Duke University, University of Illinois at Chicago, Columbia University, Johns Hopkins University and Northwestern University.
The firm has said it will invest $2bn in drug research and seed healthcare investments by 2030.
James Flynn, managing partner of Deerfield, said: “Now more than ever, these unprecedented times underscore the importance of supporting the critical work of our nation’s scientists and healthcare systems.
“Our uniquely supportive model allows us to provide leverage to innovative companies and accelerate the benefit to patients.”