A Medical Device Daily

Israeli venture capital firm Jerusalem Global Ventures reported that it will launch JGV Growth Equity Fund at $200 million. The firm said the fund “will invest in private Israeli-related technology companies that are on a trajectory to an IPO within three years and have a proven business model.”

First closing is scheduled for April 2008.

Dr. Shlomo Kalish, who founded Jerusalem Global in 1994, said, “Unlike the early stage VC investment model, where one expects multiple write-offs for every ‘home run,’ this fund’s business model should produce quicker turnaround of money, lower risk and more predictable returns.”

Jerusalem Global currently manages two sector funds launched in 1999. Dr. Yoseph Linde, who co-managed the prior funds, said, “Over the last several years, in the course of making investments for our early-stage VC fund, we were offered numerous opportunities to invest in late-stage technology companies. Although we rejected most of these offers as they did not fit our primarily early-stage focus, we did make two such investments resulting in two successful exits.”

Linde, who was a successful serial entrepreneur before joining Jerusalem Global Ventures, said the fund’s portfolio company, Mellanox, which had a successful IPO earlier this year, “would be a perfect example of companies we’d fund.”

The new fund is expected to invest $5 million to $20 million in companies with late-stage financing needs of $10 million to $50 million.

Kalish said, “Think of this fund as a barbell. On one end we have foreign financial institutions that do not have staff on the ground in Israel but have expressed interest in co-investing with us. On the other end, we have investment banks that would like to establish a strategic relationship in order to help prepare our portfolio companies for an IPO. The fund is the connecting rod in the middle, using the manager’s network and expertise to source and invest in quality deals.”

He added: “There are some interesting things going on in Israeli technology. The number of private companies with revenue of more than $10 million has exploded, and we see more in the pipeline. Yet, there is still pressure for such firms to exit too early. This fund will help successful companies bridge that gap and get to a point where they can realize their full value.”

Kalish said a number of investors in the prior fund have committed to the new fund. Jerusalem Global said it also will be marketing the fund to major financial institutions, fund of funds, university endowments, and pension funds.

Board committee studies QLT alternatives

QLT (Vancouver, British Columbia) reported that its board has formed a special committee to review “all strategic alternatives available to the company.”

The committee, comprised of three independent directors, has named Morrison & Foerster as legal counsel to report directly to the committee, which has been charged, among other things, with responsibility for exploring alternative ways to maximize shareholder value, including transactions involving the sale of all or part of the company’s assets.

The QLT board said it is reviewing proposals from several investment bankers and expects to appoint a financial advisor in the near future to assist the special committee in the evaluation of strategic alternatives.

Chairman Boyd Clarke said that the QLT board “believes that the net value of the assets of the company exceeds the value represented by the stock price. We had hoped to address that disconnect through the deployment of our current strategic plan, [but] as the gap continues to widen, we have decided that, other than as contractually required, making significant additional investments in all of our current products and technologies would be inconsistent with our objective of maximizing shareholder value.”

As a result, he said, “we are exploring all strategic options, which may include sale of all or part of the assets of the company.”

QLT is focused on pharmaceutical products in the fields of ophthalmology and dermatology. Its three technology platforms — photodynamic therapy, Atrigel and punctal plugs with drugs – have produced products such as Visudyne and Eligard.

Aetna OKs PillCam coverage

Given Imaging (Yokneam, Israel) said that Aetna, the third-largest U.S. health insurer, has updated its capsule endoscopy policy effective last month and will now cover cirrhotic patients for the screening and surveillance of esophageal varices using capsule endoscopy of the esophagus.

Aetna currently serves 16.6 million medical members, and the addition of its coverage brings the total number of people in the U.S. that have reimbursable access to Given’s PillCam ESO to roughly 30 million.

“We commend Aetna for recognizing PillCam ESO and its role in the evaluation of esophageal varices in cirrhotic patients,” said John Vierling, MD, of Baylor College of Medicine (Houston). “We hope that additional payers will soon recognize the value of this non-invasive procedure to identify patients with varices so that we can use proven prophylatic therapies to reduce the risk of bleeding.”

Varices are varicose veins that occur in the esophagus as a result of portal hypertension, which is a complication of cirrhosis. The company said that increased pressure within esophageal varices makes them susceptible to rupture and bleeding.