Texas Retirement Earmarks $225M to Healthcare Focused Funds

The Texas County & District Retirement System (TCDRS) allocated $225 million to a private credit and buyout fund in November, according to recent investment disclosures.

OrbiMed Royalty & Credit Opportunities V received the largest commitment, totaling $150 million. The New York-based firm’s strategy involves collaborating with underlying portfolio companies to offer customized financing solutions, including equity, credit, and royalty-based financing, to companies in a variety of healthcare subsectors, including biopharmaceuticals, medical devices, diagnostics, and technology-enabled healthcare services. The fund is a component of TCDRS’ direct lending program, which has expanded to include three funds and $300 million in allocations in 2024.

A $75 million commitment was made to Linden Capital Partners VI, a health care-focused buyout fund that is attempting to raise $4.5 billion. Linden Capital Partners has experienced a surge in popularity among allocators in 2024. Earlier this year, the firm established a partnership with the Ontario Teachers’ Pension Plan in Toronto to establish an investment platform dedicated to the advancement of clinical research.

The $50 billion pension system has not allocated any capital to hedge funds or private real estate thus far this year, as private equity funds and various credit strategies have outperformed. Notably, the fund returned more than 14% for the year ended September 30.