Philips invests in $250M medical technology VC fund

by Brendon Nafziger, DOTmed News Associate Editor | August 18, 2010
Investing in technology.
Royal Philips Electronics made an anchor investment in a medical technology venture capital fund with a targeted worth of 200 million euros, or around $250 million, the Amsterdam-based company announced Tuesday morning.

The fund, Gilde Healthcare III, will be independently managed by Dutch VC firm Gilde Healthcare Partners. The amount of Philips' initial investment is undisclosed.

The fund will complement Philips' in-house R&D department and the Philips Healthcare Incubator, the company said.

"If you really want to accelerate innovation, it's becoming increasingly important to open up and look for partners," Joon Knapen, a Philips spokesman, told DOTmed News.

Philips said the fund would invest in home health care solutions, sleep improvement technologies, image-guided therapies, clinical decision support and other "patient-centric" innovations. It should begin investing in companies by early next year, Philips said.

Philips aims to hold a minority share in the fund and is looking for additional institutional financial investors. Knapen said some investors have "shown interest" but declined to give names.

Because the fund will be independently managed by Gilde, it could attract "small, early-phase ventures that might not want to fall directly under the Philips umbrella, but could be interested in getting financed by an independently run fund," Knapen said.

Gilde is a branch of a 28-year-old private equity business Gilde Investment Management. Headquartered in Utrecht, it has 2 billion euros worth of funds under management, according to the company's website.

Its other two health care funds have held investments in various European and American biotech and med tech companies, such as Conatus Pharmaceuticals, which develops drugs to treat liver disease, and FlowCardia Inc., an endovascular device company acquired by C.R. Bard in May.