Delphi closes fund VIII

Life sciences investor Delphi Ventures secured $297 million to close its eighth fund, which was buoyed by a spate of recent exits.

The Menlo Park, Calif.-based firm’s latest fund exceeds the $250 million it raised for its seventh fund in 2005 and double what it raised in 2003.

Partner David Douglass says that limited partners include Harvard, MIT, The Common Fund, Parish Capital, Flag Ventures, Partners Health, ATP, ADVEC, Montagu-Newhall, University of Richmond, Swathmore College, Weathergage Capital, Knightsbridge Advisors and MacArthur Foundation.

Delphi has quietly made a name for itself in the medical device and pharmaceuticals industries. The firm has taken 25 of its portfolio companies public since 1988 and sold another 44, according to data from Thomson Reuters (publisher of PE Week).

And the list of exits should grow soon. In January, Delphi-backed, small-molecule drug company Phenomix Corp. registered for an IPO, but has yet to set the terms of the offering.

The firm took spinal device company TranS1 (Nasdaq: TSON) public in October. The company debuted with its shares at $15 each, above the announced $12 to $14 spread. Shares shot up in first-day trading, gaining more than 66%, but have since slid below the offering price.

Delphi took two companies public in 2006, backing both drug delivery company Alexza Pharmaceuticals (Nasdaq: ALXA) and wrinkle treatment device company Thermage (Nasdaq: THRM). Both are trading under their offering prices.

Delphi has had its share of portfolio company sales, too. Last year, the firm sold drug development company Ilypsa, which had raised $46.3 million from venture investors, to Amgen for $420 million; female contraception company Adiana, which had raised $54.6 million from VCs, to Cytyc for $60 million in cash and another $150 million in potential earnouts; and stent company EndoTex Interventional Systems, which had raised nearly $31 million from VCs, to Boston Scientific for an undisclosed amount.

Douglass, a medical device investor, earned himself a spot on the Forbes Midas List in 2006 for a streak of IPOs during 2004 and 2005. He came in at No. 16 in 2006 and at No. 13 in 2007. —Alexander Haislip