Capital Allocators – Inside the Institutional Investment Industry Clarke Futch – Healthcare Royalty Partners (First Meeting, EP.20)
Jun 1, 2020
Clarke Futch, co-founder and Managing Partner at Healthcare Royalty Partners, shares his journey from investment banking to pioneering the niche of biopharmaceutical royalties. He dives into the mechanics of sourcing and structuring investments, revealing the competitive landscape of healthcare financing. Futch discusses the growing importance of royalty agreements for biotech firms and offers insights on strategic portfolio construction amidst evolving market dynamics. His reflections on authenticity and decision-making provide a personal touch to the conversation.
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Career Path
- Clarke Futch's career began in investment banking, pivoting from law after clerkships.
- He transitioned to pharmaceutical royalties at Paul Capital, a pioneering firm in the then-small market.
Founding HCR
- Clarke Futch co-founded Healthcare Royalty Partners after a disagreement at Paul Capital.
- LPs approached him, enabling a quick capital raise despite the inherent risk.
Pharmaceutical Royalties
- Pharmaceutical royalties offer non-correlated yield tied to drug sales, not markets.
- Large pharma companies now primarily market and distribute drugs invented by smaller companies.