Healthcare-focussed investment firm OrbiMed has closed its third Asia private equity fund with about $551 million (Rs 3,537 crore) in capital commitments, the firm said in a statement.
The new fund, OrbiMed Asia Partners III LP, will invest across the Asian healthcare industry, with a focus on growth stage product- and services-oriented companies in China and India.
It will invest $10 million to $75 million in 15 to 20 companies. It may also co-invest with OrbiMed’s global team, enabling substantially larger investments, the firm said.
“This new, larger fund reflects our enthusiasm for the investment opportunities in China and India, which have healthcare market growth rates far superior to most developed countries,” Carter Neild, general partner at OrbiMed, said in the statement.
Senior managing mirector Sunny Sharma, who leads OrbiMed’s team in India, said that the PE firm sees “compelling opportunities” for investments across healthcare services, pharmaceuticals and diagnostics segments in India, where spending on healthcare is less than 5% of gross domestic product.
OrbiMed has more than 100 professionals across the globe and a $14 billion global investment platform. Of this, it has invested $2 billion in Asian healthcare companies, it said.
OrbiMed’s third Asia healthcare fund is bigger than its two predecessor funds combined. Its second fund closed in 2014 after raising $325 million, lower than its initial target of over $500 million. Its first healthcare fund had raised $185 million.
The PE firm's recent investments in India include Suraksha Diagnostics, in which it picked up a minority stake last year. Last October, it also made a follow-on investment in Bharat Serums & Vaccines Ltd and backed specialty pharmaceuticals company Eurolife Healthcare.
OrbiMed's other portfolio companies in India include dental chain Laxmi Dental Export Pvt. Ltd, hospital chain Kerala Institute of Medical Sciences, and mother- and child-care company Surya Children’s Medicare Pvt. Ltd.
In India, OrbiMed would be competing for investments with a few other healthcare-focussed PE funds such as Somerset Indus Healthcare fund and Evolvence India.
Quadria Capital, which raised a $304-million corpus in 2015, makes healthcare investments in South and Southeast Asia. Last year, the Burman family-backed Asian Healthcare Fund was also raising its second healthcare-focussed fund, VCCircle reported at the time.