Vivo Ventures’ Time Arrives As All Eyes Look To China
Funded initially in 1996 by private and government sources in Taiwan, Vivo Ventures has emerged as a leader among US-based VCs investing in China. The firm’s partners say its success will come through an intricate web of business development and licensing arrangements between health care companies in China with their counterparts in the US. The strategy has produced results. In the US, specialty pharmaceutical company Sagent Pharmaceuticals went public last year after building a booming business at least partially upon arrangements with China suppliers. In China, Medtronic stepped up in October to acquire Kanghui Medical, an orthopedics company with global vision and connections to privately held US companies.
You may also be interested in...
Once a lesser known firm in US life sciences investing, Vivo Capital has emerged as a global leader in biopharmaceutical and medtech start-ups, raising a $750 million fund that will be invested in the US, Europe, and China.
Biopharma offers the best PE returns of any health care sector, but represents only about a third of private equity investment in health care as investors remain wary of high-risk R&D and tend to focus on easier targets, which are in limited supply. As the low-hanging fruit disappears, PE investors are looking at new approaches beyond outright purchases and sorting out opportunities in emerging markets.
The race to acquire a local foothold in China’s medical device industry is on. Stryker's bid to pay $764 million for Trauson Holdings would take out China’s second sizable domestic supplier of orthopedic implants.