Press release: Independent Survey 9 Sept 2004
One of a kind in South Africa
The Bioventures Fund is South Africa’s first and only dedicated Biotechnology and Life Sciences Venture Capital Fund and has as its investors Sanlam, Real Africa Holdings, the Industrial Development Corporation (IDC) and the International Finance Corporation (IFC).
The fund, which has capital of R80 million, was launched in January 2002 and has thus far invested in seven South African Biotech companies, committing close to R50 million to these companies.
“Bioventures is looking for one or two more investments,” says Fund Manager Dr. Heather Sherwin. “The aim is to invest in South African companies that have proprietary technology that gives them a competitive advantage; a quality and balanced management team; a large and growing market that they are selling into; and a pipeline of products or technologies.” It’s also important to note that Bioventures invests in the equity of the company, says Sherwin – it does not offer loan finance.
The fund is managed by Biotech Venture Partners which is owned by management, Real Africa Holdings and Java Capital, a corporate finance advisory company. It was originally managed by Gensec Bank but following Gensec’s unbundling, the opportunity was created for management and Java Capital to acquire a stake, explains Sherwin.
“Bioventures views itself as a value-add investor and gets actively involved in the investments it makes,” she says. “We take a seat on the board of the companies in which we invest and then help them in strategy development as well as expanding their network into the local and international biotech community. We also help these companies raise additional finance, both from investors and from Government sources, and facilitate networking between them to allow them to learn from each other’s experiences.”
Sherwin believes the Biotechnology market in South Africa is hungry and looking for investments – so much so that Bioventures is planning to raise a second fund in 2005.
The Bioventures Fund has invested in the following seven South African companies:
Shimoda Biotechwas Bioventures’ first investment. The companyhas proprietary drug delivery technology which it is in the process of commercialising and is also involved in novel drug discovery.
Shimoda has two drugs in late stage development with licensed partners and is currently working on a third compound with the aid of a soft loan through the Cape Biotech Trust. “All three of these compounds are currently going through trials according toUSor European protocols,” says Sherwin. Shimoda also has an extensive pipeline of compounds at earlier stages.
“Shimoda has also successfully raised second-round financing following the investment by Bioventures.”
Amandla Water Systemswas Bioventures’ second investment. The company has an exclusive license to waste water bioremediation technology which was originally developed by the Water Research Council and Mr. Piet Meiering. “This technology is currently being commercialised locally, in Botswana and in Australia,” says Sherwin, "and with the renewed focus on sanitation in countries such as Botswana, Angola, Mozambique and South Africa, Amandla Water is well placed to provide home-grown technology that is ideally suited for the African continent.”
Disa Vascularis a medical device company that develops and produces stents for cardiac and other arteries. Stents are small scaffolding-type devices that keep previously blocked arteries open. “Disa’s stents have been used in more than 2000 patients and have been judged to be of the best in the world by an independent survey in New Zealand,” says Sherwin.
Since Bioventures’ investment, Disa has developed a cobalt chromium stent and is currently doing trials on a drug eluting stent. Disa’s previous products have all been awarded CE marking (European approval) and will continue to obtain international approval for future products, says Sherwin.
Synexa Life Scienceshas developed a proprietary technology that enables it to manufacture certain biological compounds in a much more efficient and therefore cheaper fashion, says Sherwin. The company currently manufactures secondary metabolites which are sold to international distributors of such research chemicals. Synexa is also exploring the useof its technology in the production of other compounds such as recombinant proteins and algal metabolites. “As with all the Bioventures companies, the technology is home-grown and originated from RhodesUniversityand the Water Research Council,” she says.
Electric Genetics is a spin-out of the University of the Western Capeand was set up to commercialise the technology developed by the South African Bio-informatics Institute which is based at the university.
The company develops and sells bio-informatics software to biotechnology and pharmaceutical companies and has an impressive client list,says Sherwin, including large multinational companies such as Bayer and Pioneer.
Mbuyu Biotechis a joint venture between Bioventures and the Council for Scientific and Industrial Research (CSIR). “The aim of Mbuyu is to commercialise the CSIR’s process biotechnology, says Sherwin.
At present, Mbuyu is in the process of commercialising three technologies. Two of these will, Aloesin and Beta-carotene, will create small startup companies to take the technology to the market. Both these new companies will be active in areas where there is high un-employment and a need for economic development.
PlatCo Technologies, which is jointly owned by Shimoda Biotech, was set up to explore platinum-based anti-cancer compounds, says Sherwin. Much of the research and development is being done in association with the University of Port Elizabeth and Professor Jan Du Preez, a world expert on platinum. To date, the company has produced a number of potential lead compounds which show improved anti-cancer properties when compared to the drugs currently available.