Evolvence India Life Sciences Fund fully exits Chennai drugmaker

Evolvence India Life Sciences Fund, the debut healthcare fund managed by private equity firm InvAscent, has fully exited its nine-year-old investment in Chennai-based Anjan Drug Pvt. Ltd, two people familiar with the development told VCCircle.

The healthcare fund exited the drugmaker by selling its minority stake to a Chennai-based privately held fine chemicals company, the people said on the condition of anonymity.

They declined to identify the buyer and provide financial details of the transaction, citing confidentiality issues.

Evolvence India Life Sciences Fund had committed to invest Rs 25 crore in Anjan Drug in 2009 in tranches.

Anjan Drug founder C Kalaichelvan said working with InvAscent had been “an enriching experience” and that the PE firm’s inputs helped the company grow over the years.

Indeed, the drugmaker’s revenue and profit have jumped since it got PE funding. Its gross income was Rs 128.8 crore for the year through March 2017 compared with Rs 23.96 crore for 2008-09, according to latest information available with VCCEdge, the data research platform of VCCircle. Net profit soared to Rs 23.8 crore from just Rs 75 lakh during this period.

Anjan Drug, established in 1990, manufactures active pharmaceutical ingredient (API)—or bulk drugs—for central nervous system disorders such as anxiety, depression, epilepsy and schizophrenia.

Its major products include valproic acid, sodium valporate, divalproic sodium, gabapentin and magnesium valproate. Exports constitute more than 80% of its sales.

The company plans to launch at least five more products over the next two years in the US, Latin America and Europe, one of the persons cited above said.

Chennai-based investment banking firm Veda Corporate Advisors Pvt. Ltd was the exclusive financial adviser to Anjan Drug and its founder.

Evolvence Fund:

The healthcare fund’s exit from Anjan Drug is the final liquidity event from its portfolio of eight companies.

It has already exited the bulk-drug unit of Vivimed Labs Ltd, UQUIFA; eye-care chain Dr Agarwal's, Gland Pharma; medical devices maker Healthium Medtech (earlier called Sutures); oncology firm HealthCare Global; and contract research and manufacturing services firm Neuland, according to its website.

The fund was also set to exit Fermenta Biotech Ltd after its listed parent, pharmaceuticals company DIL Ltd, had agreed to buy back the fund’s entire stake in the unit last year. In June, DIL approved a scheme of amalgamation with Fermenta Biotech.

The fund had raised $100 million in 2006 and was anchored by Dubai-based fund-of-funds manager Evolvence.

InvAscent’s second fund—India Life Sciences Fund II—had raised Rs 875 crore ($146 million then) in September 2014. The second fund has made 12 investments. VCCircle recently reported that it struck its 12th bet on pharmaceuticals firm Alniche Life Sciences Pvt. Ltd.

The PE firm had also hit the first close for the India Life Sciences Fund III at $150 million in December last year and the second close at $210 million in January.