Frazier Healthcare Partners: Building Healthcare Companies

Frazier Healthcare Partners is a venture capital investment firm focused on investing in innovative healthcare companies. Since its establishment, it has invested in over 200 companies and raised over $7.1 billion in total capital.

The company has a variety of investment interests, which range from company creation, venture capital investments, to acquiring lower middle-market firms that are profitable. For the same purpose, the company is divided into two teams: Growth Buyout and Life Sciences.

The firm specializes in incubation, liquidity, and growth equity funding. It invests throughout North America, Europe, and Asia in healthcare services, pharmaceutical startups, and innovative products.

According to BusinessWire’s article, “Frazier Healthcare Partners Closes $830 Million Life Sciences Public Fund”, the company is soliciting funds for healthcare companies with growth and innovation potential.

Frazier Healthcare Partners was founded in 1991 by Alan D. Frazier (Chairman and Managing Partner) and has its offices located in Seattle, Washington, and Menlo Park, California. Currently, the executive team of the company includes Jamie Brush (Portfolio Manager), Patrick Heron (Managing Partner), James Topper (Managing Partner), and Nader Naini (Managing partner).

This article presents the focus of the two teams, the Growth Buyout team and the Life Sciences team, and their broad investment portfolios.

Frazier Growth Buyout Team

With a thesis-driven, executive in residence-focused investment approach, the Frazier Growth Buyout team seeks to capitalize upon long-term trends in emerging markets.

In May 2021, Frazier Healthcare Growth Buyout Fund X, L.P. (FHGB X) was oversubscribed and hit its $1.4 billion total cap commitment, including support from prestigious financial institutions, family offices, and public pension funds.

Investment Strategies

The Growth Buyout team adheres to the following four stages while making investments in medical products, biopharmaceutical services, and any other related sectors.

• Idea generation: Through proactive outreach and organizing bi-annual retreats and the annual Montana CEO Summit, the growth buyout team meets with its leaders and executives to identify an investment opportunity that contributes to broadening the healthcare system.
• Investment profile: The team makes equity commitments from $30-350 million in fast-growing, low- to middle-market healthcare companies, generating EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) of $5-50 million. Investments come in the form of company buyouts, carveouts, and recapitalizations.
• Executive in residence: In partnership with its extensive network and human capital team, Frazier pairs qualified executives with curated investment ideas. In this way, the EIR is also benefited by taking on an Executive Chairman or CEO role.  
• Center of Excellence team: Frazier’s Excellence team provides a range of services to its portfolio companies, including human capital, financial services, operation management, legal, and information technology services.

Featured Portfolio Companies

The Frazier Growth Buyout team is focused on investing in transformative healthcare companies including those that provide biopharma services, Packaging Coordinators Inc. (PCI) services, medical and clinical trial services, drug development providers, and any other related products and services that can strengthen the healthcare system and patient care.

Frazier’s growth funds invest in many healthcare companies, some of which include:

• Alteon Health: This company offers outsourced healthcare practice management services to hospitalist programs, emergency departments, and urgent care centers based in hospitals. Its programs ensure improved patient experience, better physician and medical staff satisfaction, and availability of superior clinical care.
• Caravel Autism Health: This company provides home-based therapies to children suffering from autism or any related developmental disabilities. Its services range from diagnosis and evaluation, therapy, and treatment. It also provides social skills training to diseased patients.  
• EPTAM Precision: This is a leading outsourced manufacturer in the medical device industry, having expertise in metal machining, plastic machining, component design, injection molding, and process validation and program management services.
• Leiters: A manufacturer and provider of compounded sterile products that are registered by the FDA. Its expertise is in supplying ophthalmic products and acute setting injectables to clinics, hospitals, and surgery centers.
• SunMed: This is a leading manufacturer and distributor of branded and private label respiratory and anesthesia medical products in Mexico, China, and the U.S. Its products range from pressure infusion bags, resuscitation bags, oxygen delivery, aerosol medication delivery, to capnography and laryngoscopes.
• United Dermpartners: This is a physician-focused and patient-centered dermatology practice management platform. It offers services including dermatopathology, general dermatology, Mohs surgery, and aesthetic services.
  

Frazier Life Sciences Team

The team of Frazier Life Sciences specialists invests in and forms companies for the development, commercialization, and licensing of novel therapeutics. Currently, the team holds a $617 million life sciences-focused fund (raised in 2020) to invest in transformative companies.

Investment Strategies

The investment strategy of the Life Sciences team is focused on three types of investment areas:

• Company formation: Through a robust relationship with academic institutions and pharmaceutical companies, the Frazier team identifies, licenses, and invests in innovative startup companies with incredible management teams.
• Early-stage venture: Frazier is committed to investing across all rounds of private companies and looking for opportunities that could yield meaningful clinical results for diseases that currently have unmet medical needs.
• Late private/publics: The Frazier team invests in public markets and mezzanine financings, focusing on long-term returns.
  

Featured Portfolio Companies

The Frazier Life Sciences team invests in therapeutics and other similar areas that offer innovative solutions to current healthcare challenges. They serve as a true partner to their entrepreneurs, providing guidance, resources, and expertise at every stage of their business development.

Some of the companies included in their portfolio are:

• Acerta Pharma: This company leverages the BTK inhibitor to treat severe diseases resulting due to inflammation and hematologic malignancies. In 2016, it was acquired by AstraZeneca.
• Alcresta Therapeutics: This company caters to the discovery and manufacturing of new enzyme-based products that contribute to improved digestion and nutrient absorption. Its products help patients with impaired pancreatic function to absorb nutrients like long-chain fatty acids.
• Dascena: This company is committed to improving patient care using advanced machine learning. It develops predictive biomarkers derived from algorithms that help detect complex health conditions and allow the delivery of customized care to patients.
• Hillevax: This company develops and markets novel vaccine candidates. Currently, it’s developing HIL-214, a virus-like particle (VLP) based vaccine candidate, to prevent acute gastroenteritis at any stage.
• Marcadia Biotech: This company utilizes incretin pathways (GLP-1, GIP, glucagon) as a novel therapeutic to treat type 2 diabetes.
• Radionetics Oncology: This company is committed to developing and delivering novel precision radiopharmaceuticals to treat a range of cancer conditions. Its current approach involves the use of Crinetics Pharmaceuticals’ non-peptide, a small molecule platform to deliver a targeted response.

Visit www.frazierhealthcare.com to get further information on the investment strategies or portfolio of the company.

How Excedr Supports Venture-backed Labs

Frazier Healthcare Partners is a venture capital firm committed to strengthening the healthcare system by providing complete support to healthcare providers. It has its investment experts split into two groups: the Growth Buyout Team and Life Sciences Team.

In its investment strategy, the firm seeks to provide capital to companies supplying pharmaceuticals and medical products. Frazier Healthcare Partners offers its assistance at all stages of a company’s development, ranging from providing human resources to licensing its products.

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