Biotech fund grows investments

Challenger International has confirmed a new investment for its listed biotechnology private equity fund for retail investors, BioTech Capital.

The $3.5 million investment in Brisbane based drug company Xenome is the BioTech fund’s fifth, taking the fund’s total investment across all five investee companies to $14.5 million.

The announcement follows news that existing investee company, X-Ray Technologies, has completed the first sale of its X-Ray Ultra Microscope to NASDAQ listed company FEI.

But even with the latest investment, BioTech Capital has managed to place only 37 per cent of the $40 million raised from investors in August last year, many of them doctors, dentists and other life-sciences professionals.

BioTech Capital executive director Harry Karelis says the fund has considered 116 proposed deals since inception, and has another three currently under review, but only a select few had managed to make it past the fund’s screening process.

“We’ve taken care to seek out quality investments that will prove winners for investors over the medium-long term,” Karelis says.

Karelis says the biotechnology sector, like other asset classes, was not without risk, but would not suffer the same boom bust cycle as dot.com companies.

He says biotechnology, buoyed by the world’s ageing population and a corresponding growth in demand for health services, had the potential to offer significant capital returns for investors.

“Australia has a long track record of achievement in the field of life sciences, and we firmly believe that combining sufficient capital with the right mix of people and technology can result in the expansion of what is currently a nascent industry,” he says.