Abingworth, the life-sciences international investment firm, announced last Thursday that they have raised a new $105 million Abingworth Clinical Co-Development Fund (ACCF) - the result of an investment made by the European Investment Fund and others. The fund is designed to support late-stage clinical therapies through co-development companies.
The 11th life sciences fund had an initial target of $100 million but ran an oversubscription. The ACCF will now back co-development companies to finance the Phase III clinical trials and own all regulatory risks and losses. However, they will receive a pre-negotiated return once the drug gets the green light from the government.
Abingworth has been an investor to two such portfolio companies - San Francisco-based SFJ Pharmaceuticals and the London-based Avillion. Till date, Abingworth had not raised a new fund but had been investing out of current stashes, while reserving 25-30% for future endeavors.
According to Fierce Biotech, Tim Haines, managing partner of Abingworth's London headquarters, said, "This is the first dedicated co-development fund. It's the kind of fund that attracts a different kind of limited partner into the fold; someone who may be drawn to the straightforward prospect of gambling on a specific set of late-stage studies, where Phase II or even related Phase III data can be on hand to assess the risk involved."
However, Haines is no stranger to the fact that a single Phase III trial run can cost almost $150-200 million and easily outrun the much-talked-about $105 newly set-up fund.
Through SFJ, Abingworth has made valuable contributions in helping Eisai Co. Ltd.'s late-stage trials for a thyroid cancer treatment called lenvatinib. The resultant end-product LENVIMATM was approved in the US, Europe, and Japan and meant a "high-quality exit" for Abingworth, as per PR Newswire.
"Abingworth has pioneered the clinical co-development approach," said Haines in a Thursday statement, as stated in Law360. "In addition to the attraction of novel financing mechanisms, pharma and biotech companies appreciate the fast execution and high-quality clinical data that co-development companies provide."
With over $1 billion, Abingworth has already made investments in 138 life sciences firms, which led to 60 initial public offerings and 40 mergers and acquisitions.
A US Securities and Exchange Commission filing showed that ACCF was eventually set up in 2015 under the management of the London Abingworth headquarters. This venture capital fund, as described in the regulatory filing, made investments in almost 32 US states. Currently its biggest investor, EIF said it is "is "keen to support innovative investment models."
Piyush Unalkat, an investor officer in this EU-backed set-up, spoke about how the fund is aiding the small and medium-sized entities. "This fund addresses an acute need for alternative sources of financing for the late-stage development of therapeutics and contributes towards providing a vital continuum of funding in the life sciences venture capital investment chain."
ACCF is now ready to make its first investment in SFJ Pharmaceuticals IX, an SFJ entity. No further details were provided for this move to back the San Francisco-based company in the late-stage clinical co-development business.
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