Private Equity News & Analysis

Three Paul Capital partners join Cowen(3)

Three former partners from Paul Capital Partners’ healthcare royalty fund—Gregory Brown, Todd Davis and Clarke Futch—have moved to investment bank Cowen Group, where they have launched Cowen Healthcare Royalty Partners (CHRP).

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The ex-Paul Capital partners have worked as a team for several years in life sciences investing, most notably by providing capital to holders of pharmaceutical and other medical product IP in exchange for rights to the royalty streams.

Todd Davis and Clarke Futch have officially moved to Cowen, and Gregory Brown is scheduled to join them there in October. According to the announcement, CHRP will raise interim capital until Brown’s arrival, at which point it will launch a more formal fundraising effort.

Paul Capital Healthcare closed its second fund on $650 million in 2003. Recently, Paul Capital announced a $27 million investment in India-based Glenmark Pharmaceuticals, which will be used to build a generic US dermatology product portfolio and finance development of 16 dermatological products for the US market. Paul Capital will receive undisclosed royalties on net sales following the US Food and Drug Administration’s approval and the launch of each Glenmark product. The firm said the market for the products in the United States is worth $1 billion.

“Building out our alternative asset management business has been a top priority for Cowen,” said Kim Fennebresque, Cowen’s chairman and chief executive officer, in a statement. “We feel fortunate that we were able to find highly qualified individuals focused on healthcare which has traditionally been one of Cowen’s strongest franchises.”

Brown was a general partner and co-head of Paul Capital Healthcare (formerly called Paul Royalty Fund). Brown joined Paul Capital in 2003, and was actively involved in the execution and management of more than $200 million in investments

Davis joined Paul Capital in 2004. As a principal there, he was responsible for sourcing and evaluating US-based royalty and revenue-interest investment opportunities.

Futch was a partner at Paul Capital, where he was responsible for sourcing, executing and managing more than $400 million in royalty investments. Futch joined Paul Capital in 2001.

Brown and Davis’ departures from Paul Capital were originally reported in the January issue of IP Investor.