Cowen Healthcare acquires in vitro drug rights for $52.5m

The Paul Royalty Funds spin-out has deployed capital rapidly, making five investments to date from its $500m debut fund, which closed this past July.

Cowen Healthcare Royalty Partners (CHRP) has completed the fifth investment from its $500 million debut fund, acquiring the royalty rights to future sales of in virtro fertilisation drug Centrotide for $52.5 million.

CHRP agreed to purchase the rights last month from biopharmaceutical company AEterna Zentaris, which will receive an additional payment of $2.5 million if sales reach a specified level by 2010.

Centrotide is currently in phase three clinical trials.

The healthcare-focused private equity practice of boutique financial services firm Cowen and Company focuses on the monetisation of royalties in commercial and near-commercial-stage healthcare products.

CHRP closed its debut fund in July after spinning out from Paul Royalty Funds. The firm launched in January 2007 with an anchor investment of $25 million from Cowen and Company before actively beginning fundraising the following November.

The firm agreed its first transaction in January, investing $22.5 million in Artes Medical, which produces wrinkle filler ArteFill. CHRP then entered into a $50 million loan agreement with biotherapeutics company Dyax and agreed to pay up to $105 million for the revenue stream of cholesterol drug Fenoglide, both in August.

CHRP also made an undisclosed royalty investment of $107.5 million in 2008, according to the firm’s website.