KKR has bought a minority stake in life sciences specialist Catalio Capital Management and is also investing in the firm’s funds in an expansion of its healthcare growth strategy.
Catalio was founded in 2020 by George Petrocheilos and R. Jacob Vogelstein to invest in the next generation of category-defining life sciences companies around the globe. Prior to founding Catalio, Petrocheilos and Vogelstein were general partners at Camden Partners Holdings, LLC, a private equity firm spin-out from T. Rowe Price, focused on making biomedical technology investments.
The capital is expected to push forward Catalio’s growth trajectory and talent acquisition, as well as serving as an anchor to its investment strategies that span private equity, credit and capital markets.
In January, the $1 billion-plus Catalio launched a global long/short equity hedge fund strategy targeting key opportunities across the life sciences and healthcare sectors.
As part of the deal, Henry Kravis, co-founder and co-executive chairman of KKR, will be named as the chairman of a new Board of Advisors for Catalio that will help guide the strategic growth of the business. Members of the Catalio Board of Advisors will include, among others, Alex Gorsky, the retired chairman and CEO of Johnson & Johnson, Andrew Liveris, the retired chairman and CEO of Dow Chemical Co., Dina Powell McCormick, the vice chairman and president of Global Client Services at BDT & MSD, and Tim J. O’Neill, a longtime partner and retired co-head of Goldman Sachs Asset Management.
“The life sciences sector represents a growing market opportunity and has been an important area of focus for our healthcare growth strategy, which will be further accelerated through our partnership with Catalio. We are impressed not only by Catalio’s entrepreneurial leadership team but also by its vast network of leading scientists who serve as venture partners,” said Ali Satvat, Partner, co-head of Americas healthcare and global head of health care strategic growth at KKR. “We look forward to supporting Catalio in taking the platform to the next level and unlocking the next generation of biomedical technology.”
KKR has committed over $20 billion to the healthcare sector since 2004. In the life sciences sector specifically, KKR has already committed well over $1 billion in capital from its healthcare growth strategy, including investments in BridgeBio Pharma, Dawn Bio and Treeline Biosciences, and will be funding this investment from its balance sheet.
KKR’s healthcare growth strategy is focused on investing in high-growth health care-related companies to which KKR can be a unique strategic partner in helping reach scale.
“We are grateful to KKR for its support, which we believe affirms the success of Catalio’s strategy and recognizes the value of our experienced life sciences investment team,” said Petrocheilos and Vogelstein, co-founders and managing partners of Catalio. “KKR’s investment comes at an exciting time in Catalio’s development. We believe that we will now be even better positioned to empower the world’s most innovative clinical scientists to turn next-generation biomedical discoveries into valuable treatments and cures and create profitable, well-run companies that advance the boundaries of care.”
Following the completion of the transaction, Petrocheilos and Vogelstein will continue to own a controlling stake in Catalio, and the day-to-day management and operation of the Catalio business will remain the same.
Kirkland & Ellis served as legal advisor to KKR. Paul, Weiss, Rifkind, Wharton & Garrison LLP served as legal advisor to Catalio.
