[Update #2] A bold call? Perhaps… As 2009 winds down with about ten weeks to go it sounds as if one should not be surprised that large stockpiles of cash move from the sideline, tighten the chinstrap and get in the game – from limited partners to funds to institutions – who move to deploy capital in both the private and public markets. In terms of new life science fund formation tack on to the total the latest entrant, courtesy of General Electric (NYSE: GE), the $250M GE Healthymagination Fund, bringing the grand total of recently closed life science funds to $2,175M in investable capital.

The fund will target three broad areas of investment:

• Diagnostics | including imaging, home health, patient monitoring, molecular diagnostics, pathology, novel imaging agents and other technologies for disease diagnosis.

• Healthcare IT | including electronic medical records, clinical information systems, healthcare information exchanges and value-added data services.

• Life Sciences | including tools for research and development in biopharmaceuticals and stem cells, and technologies for manufacturing of biopharmaceuticals and vaccines.

[Update #1] Add Domain Associates, Domain Partners, VIII $500M to the early-stage drug and device sectors; bringing recently closed funds up to $1,925M $2,175M.

[Original Post] Recently Boston, MA-based Excel Venture Management announced the close of the new $125M Excel Medical Fund. The portfolio is a planned balance across healthcare IT and services, diagnostics, and medical devices, plus life science platforms that address adjacent markets which may include energy, chemicals, defense and agriculture. It is made unambiguously clear that single molecule drug companies need not apply – for such an approach is not of interest to their principals. Initial investments are in the $1M to $5M range and it appears at least five investments have been made to date, these include 1. Aileron Therapeutics (developing ‘Stapled Peptides’, a potential new therapeutic modality that may target a diverse spectrum of human disease) 2. BioTrove (providers of micro- and nano-scale technologies to the research and diagnostics markets) 3. Dormir (an integrated provider of sleep diagnostic services, therapy and equipment) 4. MedVentive (provider of healthcare IT business intelligence solutions) and 5. Synthetic Genomics (creating synthetic genomic solutions for the production of biochemicals, next generation biofuels and vaccines).

Additional life science funds that have closed within the last twelve months include Essex Woodlands Ventures $900M Fund VIII which invests across the spectrum of drug, device and service companies in North America, Europe and Asia, and Morgenthaler Ventures checked in with their $400M Fund IX, who in their press release indicated a continued focus on early-stage investing.

So sum it all up and approximately $1,425M $2,175M in new early-stage life science capital is needing to be put to work and eventually returned at some hopeful market exceeding multiple to the fund’s limited and managing partners. What are you doing to make your entity “investable”?

_______________________________________________________________________________________

Sign up [HERE] for FREE Subscription to Pharmaceutical Executive and Life Science Leader Magazines (and other journals too!)