Sofinov lead investor in new early-stage life science fund following success of T2C2/Bio

CDF Sofinov has spearheaded the creation of a $94-million venture capital fund devoted to early-stage life science opportunities, following its success with T2C2/Bio which was launched in 1997 with an initial investment of $15 million. T2C2/Bio 2000 will receive half of its capitalization ($47 million) from Sofinov, with the remainder coming from four partners — Bombardier Trust (Canada) (the Bombardier Inc Pension Fund), Solidarity Fund QFL (Quebec’s labour-sponsored venture capital fund), Société Innovatech du Grand Montréal and France’s CDC PMC, a subsidiary of Caisse des dépôt et consignations.

While clearly modelled on its predecessor, T2C2/Bio 2000 varies in several significant ways. In addition to a far greater capitalization and number of investment partners, it will also be seeking to expand its deal flow beyond Quebec and into the global arena, using a network with strong connections in Paris and Boston. Its focus will continue to be on life sciences start-ups emanating from universities, research centres and industry. The limit on individual investments has also been raised from $500,000 to $1 million, making it more attractive for follow-on investment, according to Daniel Pharand, Innovatech du Grand Montréal’s VP health sciences.

“It’s still seed funding but it will look for more mature early-stage companies that have already done proof-of-concept work,” says Pharand, adding that his fund has now invested $5 million in each of the T2C2 funds. “In Quebec, biotechnology is growing on a constant basis because growth in the sector is driven by the funds available. It’s like a self-seeding wheel. As soon as you build a bridge, you have traffic.”

The launch of the new fund continues a pioneering success story that began four years ago when Bernard Coupal, former president — some say the patriarch — of Innovatech du Grand Montréal, took up the challenge from CDP Sofinov to create T2C2/Bio and T2C2/Info. (The T2C2 acronym stands for Transfer, state of the art Technologies, optimal Commercialization, and interactive Capital). Sofinov is a subsidiary of Caisse de depôt at placement du Québec which together with its subsidiaries has a portfolio of more than $15 billion.

Pharand says it was an easy decision for Innovatech to participate in T2C2/Bio 2000, given the success it enjoyed with the first fund. “In addition to a nice return on investment, we did most of the follow on investment,” he says.

R$