Aims to Consolidate IVF Service Verticals by Continent, Starting with Southeast Asia
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BY: RON SHINKMAN
In an attempt at consolidating a fragmented global market for reproductive medical services, Recharge Capital has launched a $200 million vehicle to invest in women’s health, including IVF.
New York and Singapore-based Recharge Capital announced last month that the new holding company – called the Women’s Healthcare Investment Vehicle – will “be strategically deployed to invest, roll up, and create an end-to-end ecosystem within the women's fertility value chain across Southeast Asia, Latin America, Europe, and the Middle East.”
Recharge, which has assets of about $6 billion, has placed funds in “thematic-focused” investments. Along with women’s healthcare, these include clean biotech, semiconductors and fintech, among others.
The vehicle has at least eight big investors attached. Among them are Thiel Capital, run by billionaire Peter Thiel; the Al Rashid Family, headed by Saudi billionaire Nasser Ibrahim Al-Rashid; and Shamrock Holdings, the investing company for the estate of Roy Disney and members of the Disney family.
Lorin Gu, the 30-year-old founding partner of Recharge Capital, said in an email that “we aim to transform the sector by creating full-scale integration of disruptive technologies, diagnostic solutions, and seamless patient experiences through digital platforms and local clinic chains.”
One of the biggest issues causing fragmentation of reproductive medical services, according to Gu: Different laws and regulations by country.
“For example, many couples start their experience in China for consultation, believing that China has the best medical quality, but only to realize that the country has many restrictions such as egg freezing requirements, genetic testings and sex selection, which are allowed in other markets like Thailand and Malaysia,” Gu said.
Generation Prime Planned to Launch 15 Clinics
Partly as a result, Gu predicts that about 70% of its customers in Asia will be Chinese medical tourists seeking services in other countries. “We want to demonstrate how a streamlined service can bring much more efficiency and less opacity to the process as patients navigate across different jurisdictions,” he said.
One of the first ventures invested in by the Women’s Healthcare Investment Vehicle is Generation Prime, which received seed backing. It has plans to open 15 clinics in Thailand, Malaysia and Singapore.
“For Chinese patients seeking services not currently available in their home country, Generation Prime provides hand-holding experience for patients, starting from virtual education and consultation to understand the customization needs of the IVF journey, and then travel and treatment arrangements for specific services in our clinics in Singapore, Malaysia, Thailand,” Gu said. He added that some clients may also elect to obtain some services in the U.S., such as surrogacy.
Global Expansion of IVF
David Sable, M.D., a life sciences portfolio manager in New York City who also founded two separate reproductive technology firms, suggests entrepreneurs are beginning to see reproductive medicine in global as opposed to regional terms, and it’s clear there is a mismatch between demand and available services. Worldwide, he said there are about 3 million IVF cycles a year performed on between 1.5 million and 2 million people when repeat cycles are included. But based on his company’s research and making some assumptions about the market, Sable believes there is probably enough demand worldwide to perform 20 to 30 million cycles annually.
“If you really map out demand for it, it’s easily a half-trillion-dollar industry,” he said. “Right now, it’s disguised as a $20 billion-a-year niche industry. So, I’m not surprised that people who have a lot of money to invest are putting capital into it.”
Gu said that in addition to Asia, Latin America, Europe and the Middle East are also expected to see enormous demand for services in the coming years. As in Asia, it is expected that clients will engage in foreign travel in order to receive the services they specifically desire but may not be able to obtain in their home countries. “A primary focus will be placed on international fertility medical tourism,” he noted.
“Novel” Structure for Accountability to Investors
The Women’s Healthcare Investment Vehicle also has what Recharge has described as a novel structure for investors, based on a “milestone-driven deployment schedule.” According to Gu, the milestones are connected to revenue numbers and earnings before interest, taxes, depreciation and amortization.
“Investors and managers have clear visibility into how capital is being deployed (as opposed to a blind pool with little visibility), as well as reduced risks for capital usage,” Gu said.
The themes reported in this publication are those of the news. They do not reflect the views of Inside Reproductive Health, nor of the Advertiser
FDA on “Monster Hunt” for IVF Labs in Violation
One west coast fertility center reports being inspected by the FDA eight times in the last year.
Because the FDA halted inspections due to the pandemic in 2020 and 2021, they are now going after fertility centers at greater frequency than ever before.
The FDA Consultants protect fertility centers by doing a “Mock FDA inspection” but they have a waitlist, and priority will go to clinics in their second year post-inspection and/or already have a warning letter.
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