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Frazier Healthcare Partners raises $1.4B fund, one of the largest in Washington state history

Nader Naini, managing associate at Frazier. (Frazier Photograph)

New fund: Seattle-based Frazier Healthcare Partners raised $1.four billion for its tenth Healthcare Growth Buyout Fund. It’s an enormous bounce from the 30-year-old agency’s most up-to-date $780 million fund and is likely one of the largest institutional funds raised in Washington state.

Fund particulars: The money might be used to speculate $50-to-$150 million in 10-to-12 middle-market healthcare firms with EBITDA of $10-to-$70 million. Frazier is concentrated on healthcare-related alternatives in pharmaceutical providers, hospital outsourcing, and information analytics/AI.

Frazier’s technique: The agency leverages its community to search out profitable healthcare executives and matches them with potential funding targets, both to take over as CEO after a deal is accomplished or to function chairman.

“There’s huge consolidation occurring within the healthcare trade in several market segments,” stated Nader Naini, managing associate at Frazier. “You’re transferring right into a extra excessive quantity, decrease margin trade that finally goes to deploy a variety of capital spent for healthcare into extra acceptable and clinically helpful affected person care.”

There was a rush of venture capital going to healthtech firms amid the pandemic. Frazier invests in additional mature firms out of the healthcare buyout fund, however Naini — who sits on the board of Seattle telemedicine startup 98point6 — stated he’s listening to the startup tendencies as nicely.

“Now we have provider-based companies, and in every of these digital healthcare has grow to be a serious part,” he famous.

Buyers: The fund took about 5 months to boost. A majority of the money got here from current fund buyers. A handful of latest endowments, foundations, pension funds, and others additionally invested. About 65% of the fund’s buyers are from the U.S.; 25% from Europe; and 10% from Asia and the Center East.

Frazier, which additionally runs a separate Life Sciences fund, has raised $6.2 billion over the previous three a long time and invested in additional than 200 firms.