Thomas, McNerney raises $375M for life sciences

Thomas, McNerney & Partners, a health care venture capital firm, announced today it closed its second fund with $375 million in commitments. Consistent with the firm’s inaugural $216 million fund raised in 2002, Thomas, McNerney & Partners II will focus on biotechnology, pharmaceutical and medical device companies across all stages of development. The fund will invest in startups as well as companies seeking capital for commercialization, asset acquisitions, restructuring and consolidation.

The firm expects to invest more than $5 million and up to $40 million over the life of each portfolio company. Thomas, McNerney prefers to back companies in which it can be a lead investor. The firm operates from offices in Connecticut, Minnesota and California.

The firm would not disclose LPs, but Pete McNerney, co-founder and partner, said that many fund I investors “substantially increased their commitment” to the new fund,

Most of the firm’s portfolio companies are private companies, but the firm did particparte in two liquidity events recently. In July, OsteoBiologics Inc. was purchased by Smith & Nephew for about $75 million. OsteoBiologics, based in San Antonio, Texas, makes surgical equipment for use in cartilage repair. It has raised about $35 million VC funding since 1994 from Thomas, McNerney, PTV Sciences and The Vertical Group, among other investors.

Also, Coley Pharmaceutical Group Inc. (Nasdaq: COLY) launched an IPO in late 2005, raising $96 million. The Wellesley Hills, Mass.-based developer of immune response effectors, had raised about $140 million from Thomas, McNerney, Venrock Associates and others.