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Sequoia-backed Koye Pharma close to roping in new investor

29 January, 2015

Mumbai-based Koye Pharmaceuticals Pvt Ltd, which is into essential drugs for primary specialty care with products targeting ailments such as arthritis, iron deficiency, asthma, etc, is in advanced talks to close a freshfunding round from a new investor, sources told VCCircle.

One of the sources said the firm is looking to raise Rs 100 crore ($16.5 million) from existing as well as new investors.

Another source informed that the new investor is expected to pick around 25 per cent stake in the company through subscription to cumulative convertible preference shares. The proposed transaction is awaiting an approval from FIPB, the nodal body monitoring foreign investment in India.

An existing investor in Koye is Sequoia Capital which had invested Rs 22.5 crore in the firm in 2013 in what was akin to a seed funding round, as the firm had just started operations then. With this Abhay Kumar Pandey, managing director of Sequoia Capital, joined as a director on the board.

Sequoia then went on to make further investment estimated to be around $10 million in Koye last year. As part of this it had received a small tranche worth Rs 8 crore in mid-2014.

Calls and emails sent to Abhay Kumar Pandey, managing director of Sequoia Capital, did not elicit any response.

Several calls and e-mails sent to Preetish Toraskar, founder and director, Koye Pharmaceuticals, did not elicit any response either.

Mumbai-based Koye is into essential drugs for primary specialty care with products targeting ailments such as arthritis, iron deficiency, asthma, etc. As per its website, it has over 300 sales personnel spread across the country.

The firm positions its products as medicines for day-to-day well-being with brands such as Coecortt, Coekastle, Coecoral, CoeHB, etc.

Koye was founded by Toraskar and Ravindra Shenoy. Toraskar has two decades of experience in the pharma sector working with firms like Cipla, Lupin, Novartis, Alkem and Mylan. In his last assignment he was head of Indian commercial operations of US drug maker Mylan.

Shenoy is also a long-timer with pharma sector and in his last job was joint managing director and board member at Aurobindo Pharma Ltd. He began his career with finance department and over the years managed business operations and has also spearheaded M&As. In the past he was COO of Alkem.

Sequoia, one of the more active VC firms in the country, has backed around a dozen firms in the healthcare domain including Koye. The bulk of these is in healthcare delivery or services space. Product and pharma companies that it has backed include Celon Labs and Paras Pharma, a maker of FMCG and OTC healthcare products, which was sold to Reckitt Benckiser in 2011.

Sequoia Capital raised $530 million in its fourth India-focused fund last year to build on its venture and early growth investment activity in India. This new fund will invest in sectors like technology, consumer and healthcare. It was the most active VC fund in the country in 2014.

(Edited by Joby Puthuparampil Johnson)


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Sequoia-backed Koye Pharma close to roping in new investor

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