New Amplitude fund looks to bet over $100 million on incipient Canadian biotech market
Two top Canadian venture capitalists and the Business Development Bank of Canada have raised over $70 million for a new fund aimed sharply at funding promising ideas emerging from the “under-funded” Canadian biopharma and healthcare sector.
Jean-François Pariseau and Dion Madsen have spun out their healthcare division of BDC Capital into the Amplitude fund. They’ve raised over CAD $100 million ($76 million USD) with a goal of CAD $200 million ($152 million USD), to bolster precision medicine north of the 49th parallel.
Canada may seem like an unlikely place to channel VC healthcare dollars, but Madsen said that’s part of the point. The fund will focus on three priorities — targeted therapies such as cell and immunotherapy, medical imaging and artificial intelligence — they see as promising but underfunded compared with major markets like the US and Europe.
“We see world-class innovation here, this is competitive as anything we see emerging from any academic centers around the world, but it’s relatively uninvested,” Madsen told Endpoints News. “So we see a tremendous opportunity.”
Madsen said he and Pariseau had the idea for the new fund two years ago. The aim was to build a deeper staff and a larger resource pool to back — “amplify” — a strategy they had developed over years at BDC Capital, where they oversaw a CAD $270 million portfolio.
There, the two had surveyed biopharma strategies in the US, Europe, and across Asia. Seeing Canadian companies acquired early or sputter for a lack of funds, Madsen said, they decided to provide capital, tech or that could lead them toward an IPO. They invested in 11 companies. The results included rare disease and oncology biotechs Clementia and Zymeworks, along with cardiovascular-focused Milestone Pharmaceuticals.
“Canada had scientific platforms and innovation that was really not captured because it was being underfunded and sold off,” Madsen said.
The fund officially spun out in July 2018 and had their first close today. They made their first investment this summer as part of precision oncology startup Repare Therapeutics’ $82.5 million Series B, which closed in September.
Repare uses CRISPR gene-editing technology to identify new small molecule targets for cancer. It has attracted investment interest most notably from Versant, but CEO Lloyd Segal said he and other Canadian executives have known Madsen and Pariseau for years and that gives them an advantage.
“Canada is not necessarily on the beaten path of where the tier 1 VCs globally go look for companies, and they do a great job of putting those companies onto the radar screen,” Segal told Endpoints. “They make it their business to understand the players in Canada far more deeply because that’s their day job. That’s their edge.”