Gary Cohen

AXA IM Alts, a global leader in alternative investments with over €190 billion (c. $190 billion, USD) of assets under management,^[1] has announced its investment of $24 million (USD), the first from its Global Healthcare Private Equity strategy (“the strategy”), into Maternal Newborn Health Innovations (‘MNHI’), a US-based public benefit corporation established to reduce the substantial burden of maternal and newborn mortality worldwide. AXA IM Alts is the lead investor in MNHI’s $26 million (USD) Series A financing round.

Beginning in 2023, MNHI plans to commercialize a new medical device designed to reduce maternal and newborn deaths and complications resulting from prolonged or complicated second-stage labour during childbirth. As part of a Series A financing round, AXA IM Alts’ investment will directly support MNHI in continuing its crucial work to develop solutions that provide safer and preferred methods for childbirth globally. MNHI will utilize the capital provided by AXA IM Alts to pursue regulatory approvals and commence commercial activities.

Globally, an estimated 140 million births take place every year. Prolonged or complicated labour occurs in approximately 10-15% of these births. In 2020, 2.4 million newborns died, comprising 47% of all under age-five child mortality,^[2] and 2 million stillbirths occurred worldwide in 2019.^[3] Approximately 295,000 women and girls die each year from causes related to pregnancy and childbirth^[4] and ten million more suffer from severe complications. Complications during childbirth are associated with 24% of all neonatal deaths, 40% of stillbirths and the majority of maternal deaths.^[5]

The burden of maternal and newborn mortality is highest in low and low-middle income countries,^[6] though childbirth-related deaths and complications impact mothers and their newborns in all countries. In some high- income countries, including the United States and United Kingdom, black and other minority ethnic women, face considerably higher risk of dying in childbirth than white women.^[7][8]

This is the first investment made by the newly launched AXA IM Alts’ $500 million (USD) Global Healthcare Private Equity strategy, which focuses on four core areas of innovation – medical devices, (bio)pharmaceuticals, vaccines, and diagnostics – through investing in healthcare companies that are in late-clinical and/or early commercial stages. The strategy seeks to invest in companies that aim to deliver healthcare solutions at accessible price points for global markets, including high volume markets, where demand for new products continues to benefit from rapid growth in healthcare spending and population growth. This investment directly aligns to the United Nation’s Sustainable Development Goal 3: Good Health and Wellbeing,^[9] whilst also contributing to AXA IM Alts’ broader impact objectives of addressing some of the biggest challenges globally, with enabling access to healthcare in underserved markets being at the forefront of this strategy’s agenda. The strategy can be exposed to the following risks: liquidity risk, valuation risk, sourcing/operational risk, market risk and capital risk.

Curt LaBelle, Partner, Head of Healthcare Private Equity at AXA IM Alts, said: “We are excited to support MNHI’s’ mission to improve and save millions of lives through this investment. Childbirth safety is a critical sector in need of simple-to-use interventions as there are currently limited solutions with high safety, efficacy and availability. Our investment will assist in enabling widespread access to MNHI’s innovations globally.”

Jonathan Dean, Head of Impact Investing at AXA IM Alts, said: “Building on 20 years of impact and healthcare investing expertise, we are pleased to have invested in MNHI as our first investment in the newly launched Global Healthcare Private Equity strategy. Following recent successful investments such as Alydia Health, this investment further represents our longstanding mission of providing affordable access to critical and technologically advanced global healthcare solutions.”

Gary Cohen, CEO of Maternal Newborn Health Innovations, said: “MNHI was founded as a public benefit corporation dedicated to achieving positive social impact. Having known Curt and Jon for many years from their pioneering work with the Global Health Investment Fund, we feel fully aligned in our dual goals of reducing the burden of maternal and newborn mortality worldwide while generating attractive financial returns.”

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Notes:
[1] Source: AXA IM Alts unaudited data, as of 30 June 2022
[2] https://www.who.int/news-room/fact-sheets/detail/levels-and-trends-in-child-mortality-report-2021
[3] https://www.unicef.org/reports/neglected-tragedy-global-burden-of-stillbirths-2020
[4] https://www.who.int/news-room/fact-sheets/detail/maternal-mortality
[5] https://www.healthynewbornnetwork.org/issues/newborn-mortality/
[6] https://www.who.int/news-room/fact-sheets/detail/maternal-mortality
[7]https://www.aha.org/news/news/2022-02-23-cdc-us-maternal-mortality-rate-rose-2020-women-color
[8] MBRRACE-UK Maternal Report 2019 – WEB VERSION.pdf (ox.ac.uk)
[9] The targeting of specific SDG does not imply the endorsement of the United Nations of AXA Investment Managers, its products or services, or of its planned activities and does not constitute, explicitly or implicitly, a recommendation for an investment strategy.

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The new strategy, which is seeking to raise between US$300-US$400 million, will invest in private companies focusing on creating intentional impact outcomes across scalable impact themes such as access to healthcare and financial inclusion. Within healthcare this will include the physical delivery of care through improved access to drugs and vaccines, whereas financial inclusion prioritises making financial services accessible and available to a previously under-served beneficiary group.

The new portfolio construction has been designed to capitalise on the opportunities sourced and created over the past 7 years’ activity and deployment of our impact strategy which are highly aligned to the intended mission of the next strategy – addressing the basic needs of the emerging consumer. The networks and relationships established throughout this deployment facilitate access to direct transactions, co-investments, and partnerships.

This upcoming launch follows the successful 1^st close of the AXA Impact Fund Climate and Biodiversity earlier this year, which has secured US$175 million in commitments as of today.

The dedicated impact investing team of AXA IM, led by Head of Impact Investing Jonathan Dean, is responsible for around US$600m of assets under management (AUM) as of the end of August 2019. The business is seeking to grow AUM via the new strategy, which will aim to provide a private markets solution catering for a wide investor base across insurance companies, institutions, family offices, wealth managers, and pension funds seeking to invest in Impact related initiatives.

The new strategy is expected to have its first close in the coming months. Investment involves risk, including the loss of capital.

Jonathan Dean, Head of Impact Investing at AXA Investment Managers, said: “Our mission is to identify those companies who can empower underserved and low-income beneficiaries in emerging and frontier economies and meet the basic needs of the emerging consumer.”

“Building on the extensive experience we have developed through the structuring and deployment of the previous three strategies, our new portfolio construction will enable us to efficiently disburse capital across high impact companies and projects that may deliver scalable, measurable and intentional impact outcomes, in healthcare and financial inclusion, to those who were previously under-served.”

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