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PE HUB Healthcare Wire Highlights, 10.4.18

Blackstone just became a major player in life sciences

Good morning from coastal California!

I’m about 45 minutes outside of Silicon Valley at Buyouts’ latest conference in Half Moon Bay – home to some of the world’s largest pumpkin farms (probably) and the Ritz’s famous oceanfront golf course.

I didn’t get involved with any of that, but I did arrive strategically early so as to enjoy a glorious seaside run. I could get used to small town coastal living.

Meanwhile, at the conference …

Andrea Auerbach of Cambridge Associates shared all kinds of interesting data on the pinnacles and pitfalls of private investing. Speaking to sector exposure in private equity, she asserted: “Healthcare is on the rise and I think it’s going to stay that way”.

Ok, so let’s talk stats.

Looking at U.S. PE activity, the percentage of funds’ invested capital in healthcare grew to 21 percent in 2017, up from 16 percent in 2007, 14 percent in 1997 and less than 1 percent in 1987, according to Cambridge. PE-fund exposure is still greater in consumer, but looks like it’s on a serious decline.

But not everyone is raising a new fund as a means to put more capital to work in healthcare.

Just inBlackstone Group is buying Clarus as a means to launch Blackstone Life Sciences.

Clarus, out of Boston and San Francisco, is a life sciences investment firm that has raised $2.6 billion since its founding. The firm’s co-founder Nick Galakatos will head up the new Blackstone platform.

Well it looks like Executive Vice Chairman Tony James keeping his word. If you forgot, James said at a Buyouts’ conference back in June that the PE giant was gearing up to launch a new product devoted to life sciences. He explained there was a “mushrooming need for capital” in the growth-stage area.


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