BioWorld International Correspondent

Inveni Capital, a new Finnish-German venture capital fund, has completed a first closing of more than €20 million (US$26.6 million) but eventually aims to take in €50 million to €70 million.

"We have 12 months to go," Inveni partner Markku Fagerlund told BioWorld International. Inveni, which has offices in Helsinki and Munich, will invest in early stage companies in Finland and Germany and, eventually, other regions in northern and central Europe.

The fund was conceived by its founders, Fagerlund said, to cater to emerging firms in those two countries that find it difficult to access venture capital funding.

Finland holds the paradoxical position of being, on a population-adjusted basis, one of the world's strongest performers in life sciences research but one of weakest biotechnology performers among Europe's wealthier nations. That is partly due to a lack of experience, Fagerlund said.

"That's probably one of the reasons we haven't been that successful. The science hasn't failed, but companies have not done things in an optimal way."

There is a dearth of early stage cash in Finland, particularly since the state-backed Helsinki-based investment fund Sitra withdrew from the market two years ago. "That left a big hole," Fagerlund said. (See BioWorld International, April 27, 2005.)

International sources of cash have been absent from the Finnish sector as well. In 2003, London-based Merlin Biosciences Ltd. did establish a base in Helsinki to explore the Finnish market. It previously had invested in London-based gene therapy specialist Ark Therapeutics Ltd., which gained a Finnish presence through its 2001 acquisition of OY Quattrogene Ltd., of Kuopio. However, the initiative did not result in any investments, and Merlin subsequently closed the office.

Inveni plans to build a small portfolio of investments - in pharmaceutical and medical technology firms - and to devote a large amount of time to each company. In addition to Fagerlund, the Finnish team includes Aki Prihti and Markku Jalkanen, CEO of Turku-based Oy Faron Pharmaceuticals and one of Finland's best known biotechnology entrepreneurs.

The German team is led by serial entrepreneur Wolfgang Pieken, who is also a co-founder of Munich-based Ventac Partners and CEO of MWG Biotech AG, of Ebersberg. As well as offering an investment pipeline, Germany will also offer Finnish portfolio companies an internationalization route - for partnering and for exits, Fagerlund said. He hopes to conclude Inveni's first investments this year.