Here's a tale of three family offices and how their fortunes have been transformed by the vaccines being deployed to fight COVID-19. The data, from Highworth Research, gives deep detail into how the business developments translate into the net worth of single family offices.

Last year Highworth Research highlighted - with unparalled detail - the story of the European single family office which, through astute and patient investment in the healthcare sector, made outstanding contributions in the global battle against COVID-19. We have also profiled other family offices making big strides. At the same time investments started to promise dramatic financial gains. So, several months later, what has happened to those investments? We hope readers in North America find this article interesting, given the global nature of the investments in question.

All three family offices are profiled among over 1,000 in the Single Family Offices Database compiled by Highworth Research. Whilst news media have celebrated the biotech companies and the pharmaceutical giants with which they have partnered, almost none has noted the single family offices which have quietly invested in and nurtured the scientists from the outset.

Dievini Hopp Biotech Holding and CureVac
Dievini Hopp is the family investment company of Dietmar Hopp, one of five co-founders of German software multinational SAP. He has been investing patiently in the biotech sector for the past 13 years, with his current portfolio comprising holdings in 11 companies. Among them is a company called CureVac, based in the German university city of Tübingen. 

CureVac is a clinical stage biopharmaceutical company founded in 2000 which develops mRNA-based drugs for vaccines and therapeutics.

CureVac is one of the leading developers of a vaccine for COVID-19, with its candidate currently undergoing Phase 3 trials. On February 3, 2021, CureVac and GlaxoSmith Kline announced a €150 million ($180.4 million) collaboration to develop next generation mRNA vaccines for COVID-19 with the potential to address multiple emerging variants in one vaccine. Two days later on February 5, CureVac and the UK government agreed to collaborate on the development of vaccines against SARS-CoV-2 variants. 

10 years
Dievini participated in 2010 in a venture round which raised €27.6 million for the company; then in 2012 in a Series D fundraising round which raised €80 million, and a series F in 2015 which raised €98.5 million. Subsequently, CureVac launched an IPO on the New York Nasdaq in August 2020 which raised €213.3 million for the company. Concurrently with the IPO, and demonstrating its faith in the firm, dievini Hopp Biotech and its investment vehicle DH-LT-Investment GmbH, purchased €100 million shares at the public offer price in a private placement.

Prior to CureVac’s IPO dievini Hopp and Dietmar Hopp himself were the major shareholders in the firm, holding 80 per cent of the equity capital, but the family office’s and Hopp’s personal holding have now been diluted to an aggregate of 48.94 per cent.  

The IPO gave CureVac a valuation of close to $2.8 billion. About two months later on October 19, the firm’s market cap had climbed to $9.47 billion. Last Friday February 5 CureVac’s market cap hit $22.01 billion, valuing Dietmar Hopp’s and his family office’s aggregate stake at $10.77 billion.

Athos Service and BionTech                  
Athos Service is the family office of the twin brothers Andreas and Thomas Strüngmann. Their wealth was gained by founding the generic pharmaceutical company Hexal in the mid-1980s. Hexal grew to become the second largest generic drug producer and in 2005 was sold to Novartis for $7.5 billion. 

The family invests through private equity in four sectors, one of which is biotech. One of their investments is BionTech, which is based in Mainz in Germany’s Rhineland-Palatinate. BionTech’s COVID-19 vaccine has been approved following Phase 3 trials which demonstrated efficacy rates of over 90 per cent and is now being used to vaccinate millions in a production partnership with the US pharma giant Pfizer. 

Athos financed BionTech for 12 years
Athos Service first invested in BionTech in 2008 in a seed round for the company which raised €150 million. Biontech was listed on Nasdaq New York in October 2019. Its market cap at the end of June 2020 was $11.65 billion. Its last fundraising was in July 2020 and prior to this Athos Service’s investment vehicle AT Impf held 49.06 per cent of the company. Following the July round, AT Impf’s stake was diluted to 47.55 per cent and has remained the largest single shareholder. By August 6, the market cap had climbed to $18.35 billion. 

Last Friday BionTech’s market cap had soared to $28.2 billion. Athos Service’s 47.55 per cent stake held through AT Impf is now valued at $13.4 billion.

Carl Bennet and Getinge
Carl Bennet AB is the family investment company of Swedish industrialist Carl Bennet. There are just six companies in the private equity portfolio of Carl Bennet AB. Of these, the longest held (since 1989), the largest by sales revenue, and the most valuable, is Getinge AB. 

Getinge is a manufacturer of sophisticated medical equipment for hospital markets. Its present significance is that it controls 25 per cent of the global market for mechanical ventilators, vital weapons in intensive care units for sustaining seriously ill coronavirus patients.  

Bennet nurtured Getinge for 31 years
The company’s share price increased from SEK138.7 ($16.5) on August 7, 2019 to SEK202.7 on August 6, 2020, a growth rate of 46 per cent. Last Friday, the share price was SEK212.4, a 63 per cent increase over the pre-COVID-19 price in August 2019. Getinge’s market cap on February 5 was SEK57.85 billion ($6.91 billion), valuing Carl Bennet’s 20 per cent stake at $1.38 billion. 

Bennet has patiently held the stock for 31 years, unthinkable for a venture capital fund but not unusual for a multi-generational family office.

Financing scientific discovery is a long game in investment terms and the risk of failure is great. Single family offices may be well suited to this type of patient capital, but only a tiny fraction will achieve off-the-chart success.

(Click here to register on the Highworth database. This news service has an exclusive media partnership with Highworth.)