Charter Venture Capital Announces Formation and First Closing of Charter Life Sciences Fund;...

Business Editors/Health/Medical Writers

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PALO ALTO, Calif.--(BUSINESS WIRE)--March 1, 2004

Charter Venture Capital today announced the formation and first closing of its early-stage life sciences venture capital fund, Charter Life Sciences (the Fund), with

offices in Palo Alto, California and Cincinnati, Ohio. The Fund has completed its first-closing of $30 million in committed capital directed by Palo Alto-based, C.M. Capital Corporation, a diversified asset management group, on behalf of its advisory clients. Targeting $100 million in total committed capital, the Fund has several additional institutional investors committed to join its next closing, including the Tri-State Growth Capital Fund, managed by Fort Washington Capital Partners, a private equity fund of funds manager with more than $750 million in private equity commitments.

Charter Life Sciences will invest in early-stage medical device, biotechnology and specialty pharmaceutical companies with a particular focus on the clinical areas of cancer, cardiology and women's health. With typical initial investments ranging between $500,000 and $2 million, the Fund will typically invest $4-8 million over the life of a portfolio company. Portfolio companies will be split roughly equally between medical device companies and biotech/specialty pharmaceutical companies.

Charter Life Sciences will be a focused early-stage investor with a hands-on approach devoted to operating portfolio companies in a capital efficient manner. As board members, the Managing Directors will play an active role in the management of portfolio companies by providing direct assistance on scientific and clinical strategies, business development efforts, operational matters, fund raising efforts and corporate partnerships.

The four Managing Directors of the Fund, Mr. A. Barr Dolan, Dr. Donald C. Harrison, Mr. Fred M. Schwarzer and Dr. Nelson Teng, bring together a unique combination of venture capital, medical, scientific, operational, financial and legal experience, and they have collaborated for more than fifteen years to build successful, early-stage life sciences companies. Dr. Teng and Dr. Harrison bring clinical and scientific expertise in cardiology, cancer, women's health and monoclonal antibodies. Mr. Dolan, a pioneering life sciences venture capital investor, brings twenty years of active life sciences investing experience, while Mr. Schwarzer brings extensive operational skills to the Fund.

Mr. John Couch, president of C.M. Capital, stated, "We are pleased to be providing the initial support for this emerging manager with a focused strategy. The depth of clinical and scientific experience provided by Dr. Harrison and Dr. Teng in cardiology and cancer is matched by few, if any, general partners of early-stage venture capital funds. We expect that this specialized expertise in combination with the investing and operational skills of Mr. Dolan and Mr. Schwarzer will make Charter Life Sciences a very successful life sciences fund."

With operations in both Palo Alto and Cincinnati, the Fund is well positioned to develop and syndicate Midwest life sciences investments with West Coast investors. The Cincinnati office will provide local access to the growing number of life sciences investment opportunities in the Midwest while the Palo Alto office will provide easy access to the large concentration of life sciences companies, entrepreneurs and venture capital investors on the West Coast.

Mr. John O'Connor, director of private equity and investment research of Fort Washington Capital Partners, commented, "We are pleased to be taking a leading role in supporting the arrival of this early-stage venture capital fund in the Midwest. As demonstrated by the two successful Cincinnati life sciences companies that have been founded by the Charter Life Sciences Managing Directors, we believe that the presence of venture capital funds such as Charter Life Sciences is critical to the development of the large pool of life sciences assets in the Midwest."

"Despite the high level of life sciences research activity that is present in the Midwest region, we believe that it is quite underserved by venture capital investors," said general partner, Fred Schwarzer. "For example, the amount of life sciences research funding from the National Institutes of Health within Ohio and the six surrounding states is almost 120 percent of the amount of such funding in California; however, the amount of venture capital financing in the same region is only about 15 percent of that in California."

About Charter Ventures Life Sciences' Managing Directors

Mr. A. Barr Dolan

Mr. Dolan has been investing in life sciences companies for the last twenty years as a founding partner in Charter Ventures. He has been an active founder of multiple life sciences companies, including Adeza Biomedical, EP Technologies (IPO, then acquired by Boston Scientific), Heska Corporation (HSKA), Univax Biologics (IPO, then acquired by NABI), UMD and Vesta (acquired by Pfizer).

Dr. Donald C. Harrison

Most recently Dr. Harrison's was senior vice president and provost for health affairs at the University of Cincinnati Medical Center, where he was responsible for three hospitals, more than 1000 faculty and over $240 million in funded research. Previously, he was the chief of cardiology at Stanford University Hospital, and he is also a past president of the American Heart Association. Dr. Harrison has also been an active entrepreneur and a scientific and medical advisor to Charter Ventures over the last twenty years. He was co-founder with Mr. Dolan of EP Technologies (IPO, then acquired by Boston Scientific), co-founder with Mr. Dolan and Dr. Teng of Vesta (acquired by Pfizer), founder of AtriCure, founder and chief executive officer of UMD, Inc., founder of the life sciences incubator fund Venturi Group, LLC and founder of the University of Cincinnati life sciences incubator BIO/START.

Mr. Fred M. Schwarzer

Mr. Schwarzer has been chief executive officer, and then chairman, of two Charter portfolio biotech companies, Heska (HSKA) and Palingen. During his tenure at Heska, Mr. Schwarzer completed corporate partnerships with Bayer and Novartis, completed seven acquisitions and completed the Company's initial public offering (CSFB and Merrill Lynch) and follow-on public offering (Merrill Lynch, CSFB and H&Q). During this time, Heska also obtained its first FDA approval, launched its first products, created its sales and marketing effort and grew its revenue to approximately $40 million. Mr. Schwarzer has also been president of Mingly Capital Corporation and a senior vice president of C.M. Capital Corporation.

Dr. Nelson Teng

Since 1986, Dr. Teng has been chief of gynecologic oncology at Stanford University School of Medicine. Dr. Teng is a named inventor on fifteen patents and is an author of more than 100 publications. Over the past twenty years, the scientific research at Dr. Teng's laboratory at Stanford University has focused on cancer biology and gynecologic diseases. Dr. Teng has also been an active entrepreneur and investor over the last twenty years. A founder of several companies, including Adeza Biomedical, Safe-Pro USA, Univax Biologics (IPO, then acquired by NABI), SeraCare Life Sciences (SRLS), Palingen and Vesta (acquired by Pfizer), he has also been a scientific and medical advisor to Charter Ventures for more than 15 years.