Firm: DRI Capital Inc.
Fund: Drug Royalty II
Target: $500 million
Amount Raised: $701 million
Placement Agent: Atlantic-Pacific Capital
The Toronto-based firm has gathered $701 million for
Backers include public and corporate pension funds, sovereign wealth funds, insurance companies, fund of funds and family offices in the United States, Canada, Asia, Australia and Europe. The
The firm intends to invest in the pharmaceutical royalty streams of products already in the market for several years and produced by major pharmaceutical or biotechnology companies, research institutes, universities and inventors. About half of the investments are expected to be made in the United States, the rest in Europe. Expect the firm to invest an average of $25 million to $50 million per royalty stream. DRI Capital intends to make roughly 20 investments over a five-year period, acquiring all or a portion of each royalty stream. Using the Drug Royalty II war chest, the firm has already made three investments.
DRI Capital gets involved in a project three to five years after a drug has been on the market, at which time the royalty stream has about eight to 10 years left, according to meeting minutes of the Arizona Public Safety Personnel Retirement System. In sourcing its investments, the firm looks at various attributes of the drug, including the difficulty in manufacturing it, competition and comparables on the market. The minutes note that the passage of recent health care legislation in the United States could be a boon to DRI Capital, as more Americans secure health insurance as a result.
President and CEO Behzad Khosrowshahi joined DRI Capital after a takeover by Inwest Investments Ltd. in April 2002. The firm raised $240 million in 2006 for