Tachi Yamada ran what you could call the world’s largest nonprofit venture fund for high-risk, high-reward global health ideas the past five years. Now he’s going to apply that same feel for risk and reward in the traditional venture capital business.
Yamada, 66, the former president of global health at the Bill & Melinda Gates Foundation and chairman of R&D at GlaxoSmithKline, has landed in his next full-time job as a senior executive in residence with Frazier Healthcare Ventures in Seattle. Frazier, a firm with offices in both Seattle and Menlo Park, CA, has more than $1.8 billion under management for venture capital and growth equity investments.
While at the Gates Foundation, Yamada oversaw an effort to seed hundreds of offbeat scientific projects with big potential for global health, part of the $36 billion philanthropy’s mission to fight the most common deadly diseases in the world today—including HIV, tuberculosis, and malaria. Yamada also enlisted support for the cause among Big Pharma companies that hadn’t shown a lot interest in the past. There’s probably no more than a handful of people in the world with his set of relationships in Big Pharma, and with government health ministers around the globe.
“He has a great ability to open doors, find new opportunities, help us build our existing opportunities, and get access to international markets,” says Jamie Topper, a general partner with Frazier. “I can’t say Tachi will have a dramatic shift in our strategy, but he’ll make us better investors. He has a unique set of experiences.”
Yamada will spend about 75 percent of his time working with the firm, helping to identify new investments, get the most out of existing portfolio companies, and help craft international expansion plans for the firm—especially in China and India, Topper says. Aside from Frazier, part of Yamada’s time will still be devoted to his work on the board of Japan-based Takeda Pharmaceuticals, and as a special advisor to Takeda’s CEO.
Last July in an interview with Xconomy, Yamada noted that biotech and venture firms haven’t been nearly as active as Big Pharma companies in the global health field. But he’s kept his eye on the venture business for years, partly through a part-time advisory role he has maintained since 2006 with Frazier Healthcare Ventures. Earlier this year, he oversaw the Gates Foundation’s first-ever equity investment in a biotech company—Research Triangle Park, NC-based Liquidia Technologies. The idea was, by being an equity investor instead of a project financier, the foundation could have a bigger influence over the development of a vaccine technology with broad potential against a number of diseases.
Frazier isn’t expecting that Yamada will tilt the firm’s interest toward global health, but Topper did say that global health is “incredibly important” and that Yamada will help the firm better understand how to invest in it. “I think there’s opportunity there,” Topper says. “I’m not sure we’ll invest in 15 companies in it, but some of our companies are engaging in it now.” A couple of Frazier’s portfolio companies, Topper says, have already been interacting with the Gates Foundation, and “Tachi has been instrumental in making that happen,” he says.
Yamada, in a Frazier Healthcare statement, said he’s excited to join the firm partly because it makes bets on healthcare companies “that address major health needs.” As examples, he pointed to Seattle-based Calistoga Pharmaceuticals, a cancer drug developer recently acquired by Gilead Sciences; Marcadia Biotech, a Carmel, IN-based diabetes and obesity drug developer bought by Roche; and Baltimore-based Bravo Health, a provider of Medicare Advantage health plans for seniors which was acquired by Health Spring.
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