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In Profile: ArchiMed

In Profile: ArchiMed
Denis Ribon, ArchiMed
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Private equity firms with a sector specialisation are becoming increasingly popular among limited partners. Katharina Semke catches up with Denis Ribon of ArchiMed, a healthcare-focused French GP, to find out why

On setting up ArchiMed, founder and managing partner Denis Ribon says he took inspiration from investors across the Atlantic: "We observed that there were more and more dedicated healthcare funds in the US, which had spun out of their generalist firms to create their own healthcare-specialised private equity firms. That's when we decided to create ArchiMed."

Prior to setting up the healthcare-focused GP, Ribon was head of 3i's healthcare investment arm. There, he and his team invested more than €1bn in around 25 healthcare companies. Ribon founded ArchiMed together with three former 3i team members and started fundraising for its first vehicle Med I FIA in December 2013, while he was still on gardening leave. The fund held its final close on its €150m hard-cap in June 2015, surpassing its €120m target.

"Many LPs don't want to back any more new teams but they are open to a fund with a fresh strategy," Denis Ribon, ArchiMed

The team's fundraising efforts received mixed reactions from investors. According to Ribon, some are not yet interested in sector-specific funds. But among those who decided to back ArchiMed, he observes two major motives: "Many LPs don't want to back any more new teams," he says, "but they are open to a fund with a fresh strategy." The second main reason for investor interest was the example set by successful sector-specific funds in the US.

Network and experience
For deal sourcing, ArchiMed relies strongly on its previous network, which it built at 3i. Since it is mainly targeting small-cap companies, the sourcing process is much less intermediated than in the mid-cap space. Potential target companies are therefore harder to approach: "Whether it's former managers, directors or potential customers, we know them very well. If we get introduced by a strong player in a company's own field, it boosts our credibility," says Ribon.

Ribon believes it is not only a strong network in the healthcare sector that ArchiMed's LPs rely on and expect from a GP with a sector focus, it is also their industry expertise: "Almost all our team members have medical or operational experience in healthcare companies." Ribon himself is a trained veterinarian, while founding partner Vincent Guillaumot was managing director of French pathology laboratories group JS Bio. One of the firm's operating partners, Christoph Böhmer, worked for Biotronik, a Berlin-based maker of implantable pacemakers, defibrillators and stents, for more than a decade, including as CFO in his latest role.

ArchiMed's geographical focus lies in western Europe, specifically Germany, the UK, France, Italy and the Benelux region. The GP avoids the Nordic region because of its competitive and crowded healthcare investment landscape. Opportunities in each target country entail different strengths and weaknesses, because national regulation and other factors influence the healthcare sub-sectors including services, medtech and pharma.

In the UK and the Netherlands, for example, government healthcare funding has a strong influence on investments. "One main challenge is linked to the public payers. The NHS in the UK and its equivalents in other countries are under serious budget pressure, so they will reimburse less and less. For other companies this might prove an opportunity, because they offer solutions for cost cutting, for example at hospital and clinic level."

In Germany and France, the strong doctor lobbies can come in the way of successful deal closing at times: "In diagnostic labs or dental services, for example, it is more complicated to have a clean and proper ownership. On the other side, buyouts of clinics and hospitals are less complicated in those countries, while it is complicated in the UK," says Ribon.

In the long term, ArchiMed will look to invest in technological developments in the healthcare sector, not only regarding IT and medtech companies, but also for those that develop pharmaceutical products and service solutions. Ribon hopes research and development will continue to produce a wealth of opportunities in the years to come: "Innovation remains the main growth driver in healthcare."

So far, the GP has invested in four companies, in Italy, Switzerland, and twice in the UK. Its most recent investment was in November 2015, for life-sciences-focused consultant Deallus. The London-based company works with pharmaceutical, biotech and vaccine businesses. ArchiMed also hopes to close a deal in France at the beginning of 2016.

 

TEAM 

Denis Ribon
Managing partner
Ribon spent 13 years at 3i, where he was global head of healthcare and co-head of France, leading the firm's healthcare investment and portfolio activity in Europe, the US and Asia. The trained veterinarian and MBA started his career in finance at strategy consultant AT Kearney.

Robin Filmer-Wilson
Managing partner
Filmer-Wilson joined ArchiMed from Universities Superannuation Scheme in London, where he worked as investment manager for two years. He was also a director at TCR Capital and associate at Baring Private Equity Partners. Filmer-Wilson is also a non-executive partner at Hera Capital.

Vincent Guillaumot
Managing partner
Guillaumot spent six years with 3i, in his latest role as an associate director. He left the firm in 2011 to work with French pathology laboratories group JS Bio. After two years with the company, he became a founding partner of ArchiMed. Guillaumot started his career at Bain & Company.

Christoph Böhmer
Operating partner
In his last role, Böhmer was managing director of Biotronik, a producer of pacemakers, defibrillators and stents, where he worked for 13 years. He also has experience in the management consulting business, having worked at McKinsey for almost 10 years.

Loic Kubitza
Operating partner
Before joining ArchiMed, Kubitza worked in the deal and strategy advisory practices of PwC in London and Luxembourg. As part of a career break from PwC, he worked on a six-month cancer research project at the Medical Research Council in London. He has masters degrees in immunotechnology, molecular medicine and economics.

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