Fund of the week: Soleus Capital

Soleus Capital Management, L.P. is a healthcare specialist in Greenwich, Connecticut, formed in 2017 and operating from 2018. It is an SEC-registered adviser (CRD 294459, file 801-118942) filing Form ADV, quarterly 13F reports, and beneficial-ownership filings, and it has grown regulatory assets under management from roughly $530 million in 2021 to approximately $3.66 billion as of 31 December 2025. It runs a long/short hedge fund, three private equity funds, and a first private credit fund that closed $144.2 million.

Two things make it relevant here. It holds a purchased royalty: the net VYZULTA stream acquired from Nicox in October 2024 through the credit fund. And it has built a structured-financing practice around that credit vehicle, deploying into Pillar Biosciences, Quoin, and Longeviti alongside conventional PIPEs. A third development is worth noting: in 2025 Soleus moved from passive 13G positions to public activism, and won twice.

At a glance

• What it is: healthcare-specialist manager running hedge, private equity, and credit strategies across the capital structure
• Headquarters: 104 Field Point Road, Suite 200, Greenwich, CT 06830
• Founded: formed 2017 (Delaware entity registered 9 November 2017), operations from 2018, per the firm's own Form ADV brochure
• Principals: Guy Levy (Founder, CIO, Managing Partner), Steven Musumeci (co-founder, COO), Benjamin Lund (Partner, credit)
• Regulatory AUM: approximately $3.66 billion as of 31 December 2025, all discretionary, 14 entity clients, 100 percent in pooled vehicles. See the caveat below on sourcing
• Strategy: idiosyncratic, catalyst-driven investing in complex and niche public and private healthcare situations across biotech, medtech, diagnostics, genomics, tools, and services
• Vehicles: Soleus Capital Master Fund, L.P. (hedge, with onshore and offshore feeders), Soleus Private Equity Funds I to III, Soleus Capital Credit Opportunities Fund I, L.P. (Cayman, with parallel offshore fund), Soleus Capital Special Opportunities Fund, L.P., plus named SPVs
• Public book: approximately $2.47 billion across roughly 93 positions at 31 March 2026, down from $2.71 billion at year-end 2025
• Royalty interests: one identified, the net VYZULTA royalty and milestone stream purchased from Nicox
• Owned IP: none identified as held by the firm
• Disclosure: no Item 11 disciplinary disclosures on any Form ADV reviewed; no SEC enforcement actions or litigation naming the firm or Levy identified
• LP base: institutional, undisclosed. No placement agents disclosed on the credit fund

Soleus is more legible than most private managers because it registers and files. Fund-level economics, per-strategy performance, and the investor roster remain private.

Sourcing caveat on AUM. The $3.66 billion figure and the associated headcount derive from a third-party Form ADV mirror rather than the raw SEC filing, which is JavaScript-rendered and could not be extracted directly. The better-corroborated prior data point is the March 2025 ADV: approximately $2.34 billion, 14 accounts, 20 employees of whom 10 in an advisory capacity. The SEC IAPD record is the primary source for anyone wanting to confirm. The "approximately $2.2 billion" figure that circulated in the October 2024 Nicox release is now stale, as is a widely syndicated "$2.0 billion, down 31.54 percent" line that appears to reflect a miscalculated quarter.

A note on the name

Soleus Capital Management, L.P. (CRD 294459, Greenwich, Levy) is not Solus Alternative Asset Management LP (CRD 144155, New Jersey, Pucillo), a distressed and event-driven credit manager that reported approximately $3.2 billion discretionary as of 31 December 2025. The similarity of both the name and the current AUM figure is a live conflation risk in database and search tooling.

Investment thesis and mandate

The stated approach is catalyst-driven investing in complex and niche healthcare situations, public and private, across the lifecycle from development stage to commercial. The mandate is sector-defined rather than disease-specific.

What distinguishes the firm from a long-only or long/short healthcare manager is instrument breadth. It holds public equity, leads and joins private placements, provides senior secured and convertible credit, purchases royalties, and now runs public activist campaigns. The instrument is selected by situation rather than by mandate constraint.

How capital enters and returns

Three vehicle families sit at different points on the capital structure.

Hedge. Soleus Capital Master Fund, L.P. holds the long US-listed book visible in quarterly 13F filings, with onshore and offshore feeders above it. Institutional Investor reported in 2023 that the master fund had not had a down year since inception. No audited return series is public, so that claim rests on a single media report.

Private equity. Funds I (2018), II (2021), and III (2022 to 2023) are confirmed by Form D. Fund III is the active vehicle and appears as the filing entity on several recent 13G and Form 4 filings. No Fund IV has surfaced in SEC filings as of July 2026.

Credit. Soleus Capital Credit Opportunities Fund I, L.P., formed 2023, targets senior secured loans, asset-backed financing, and senior convertible securities in small and mid-size commercial-stage companies. The original target reported was $250 million to $300 million. Form D history shows the original filed 12 July 2024 with nil sold, then amendments in July and September 2025 showing $144,235,000 total sold, first sale 2 October 2024. The general partner is Soleus Credit GP I, LLC. No Fund II has been filed.

The royalty transaction runs through that credit fund, and is set out in full below.

Financial profile and assets

All AUM is discretionary and attributable to pooled investment vehicles. The 13F book is a subset covering long US-listed 13F securities only: it excludes shorts, private positions, the credit book, the royalty, and cash, so it understates both AUM and portfolio breadth.

The public book

Top holdings at 31 March 2026 were Krystal Biotech, Celcuity, TG Therapeutics, Insulet, and NovoCure. New positions that quarter included Indivior, Progyny, ICON, Context Therapeutics, and Vir Biotechnology. Quarter-over-quarter the reported value fell from approximately $2.71 billion to approximately $2.47 billion.

One royalty line, and a franchise around it

The Nicox purchase is a genuine revenue interest held by a Soleus vehicle. It is also, so far, the only one. The more durable point for this readership is that the credit fund has become a repeat provider of structured, non-dilutive financing, which puts Soleus in competition with royalty desks for the same situations even where the instrument is a loan or a convertible rather than a royalty.

Investors and the LP base

All assets sit in pooled vehicles offered under Reg D 3(c)(7). No limited partners are named in public filings, and no pension, sovereign, endowment, or fund-of-funds commitment was identified. The credit fund's Form D shows nil sales commissions and nil finders fees, so no placement agent is disclosed.

Visible instead are deal syndicates, which are distinct from the funds' LPs: Fidelity, The Column Group, Viking Global, and Cormorant on Neurona; Illumina on Pillar Biosciences; Nantahala, Stonepine, AIGH, Diadema, ADAR1, and Velan on Quoin; Perceptive, ADAR1, MPM BioImpact, Octagon, Eventide, Kalehua, and DAFNA on Adlai Nortye.

Governance and compensation

Levy is sole managing member of Soleus Capital Group, LLC and Soleus GP, LLC, which sit above the master fund's general partner and above the management company respectively. That chain was reconfirmed in a group Form 4 filed 29 June 2026 for Parabilis Medicines. Musumeci is COO and signed the credit fund's Form D in that capacity. Lund leads the credit strategy and is the quoted principal on both the Nicox and Pillar transactions. Other named senior staff include David Canner and Lennox Ketner as partners and Michael Coppola as CFO. Headcount is roughly 20 to 23 depending on filing year.

No compensation disclosure exists for the firm, as no public filing carries one.

IP, royalties, and the economics of return

No owned patent estate is attributable to the firm. The relevant instruments are the following.

The Nicox VYZULTA royalty purchase

On 14 October 2024 Nicox SA (Euronext Growth Paris: ALCOX) announced a royalty purchase agreement with Soleus Capital Credit Opportunities Fund I, L.P.

Consideration and structure:

• $15.0 million (EUR 13.7 million) upfront, less certain expenses, for Nicox's entire net VYZULTA royalty and milestone entitlement, effective for royalties from 1 July 2024
• $1.5 million (EUR 1.37 million) equity subscription: 4,360,256 Units at EUR 0.3144, being 120 percent of the 11 October 2024 close, each Unit carrying one warrant
• Warrants over up to 1,308,077 shares at EUR 0.5240, a 100 percent premium, exercisable 11 October 2024 to 10 October 2034
• Post-transaction Soleus held approximately 6.36 percent of Nicox
• Bausch + Lomb remits payments to Pfizer and Soleus at the direction of Soleus and Nicox
• Scope is VYZULTA revenue only, excluding all other Nicox products and candidates
• Advisers: Bourne Partners (financial, Nicox), Lexelians and Farber LLC (legal, Nicox), Morgan Lewis & Bockius and Racine (legal, Soleus)

Underlying stack. VYZULTA (latanoprostene bunod) was licensed exclusively to Bausch + Lomb globally in 2010 and launched in the US in December 2017. Bausch + Lomb pays tiered royalties of 10 to 16 percent across four tiers, reaching the top tier above $500 million in global net sales.

Net of Pfizer's share under Nicox's August 2009 contract, the stream Nicox held, and Soleus now holds, is 6 to 12 percent. A $20 million milestone falls due at $100 million net sales, of which $15 million goes to Pfizer, leaving $5 million net to the acquired position. Total potential milestones were increased to $165 million under amended terms. Nicox recognised over EUR 4 million in net royalty revenue in 2023, mostly VYZULTA, and EUR 3.1 million in H1 2024 before divestment. US patent term supports recurring revenue to approximately 2029 to 2030.

Post-sale position. Nicox's H1 2025 report confirms it no longer receives VYZULTA royalties following completion in H2 2024. Nicox monetised to fund NCX 470, whose Denali Phase 3 topline was expected in Q3 2025, and has since indicated it expects to repay its financial debts. No public disclosure indicates Soleus has exercised the Nicox warrants, and no further Nicox transaction with Soleus has been announced. Because the stream now sits inside a private fund, its performance is no longer publicly observable, which is itself the point: the disclosure trail ends at the sale.

Structured financing

The credit fund's other disclosed deployments are credit and hybrid rather than royalty:

• Pillar Biosciences, May 2025: $34.5 million, described as structured financing from Soleus alongside strategic equity from Illumina
• Quoin Pharmaceuticals, October 2025: up to $104.5 million, approximately $16.5 million upfront plus up to $88.0 million on warrant exercise, with tranches tied to QRX003 milestones and a potential priority review voucher sale
• Longeviti Neuro Solutions, August 2025: $10 million structured financing, with Tim Scannell named board chair. This one is corroborated only by a single release and warrants a second source before load-bearing use

These carry contractual coupons, security, and warrant coverage rather than product royalties, but they compete for the same non-dilutive financing situations.

Equity and activism

Ordinary common stock, PIPE units, and 13D positions carry no royalty and return through appreciation and catalysts. Two 2025 campaigns are set out below.

Activism, 2025

Soleus filed passive 13Gs across a wide healthcare book for years. Three issuers show 13D activity: BioAtla (Fund I, filed December 2020, six amendments through 2024, with board-level involvement), Theratechnologies, and ESSA Pharma.

Theratechnologies. Soleus had pressed for a sale in letters dating to December 2022, November 2023, and October 2024, having filed a 13D on 28 November 2023. On 11 April 2025 it wrote publicly backing Future Pak's proposal of at least $3.51 per share, a 163 percent premium to the 10 April close, and criticised the board's responsiveness to interested parties. A special committee ran a process with Barclays and Raymond James as financial advisers and Fasken Martineau DuMoulin and Norton Rose Fulbright as legal.

On 2 July 2025 Theratechnologies signed with CB Biotechnology, LLC, a Future Pak affiliate, at $3.01 per share cash plus one contingent value right worth up to $1.19, totalling up to approximately $254 million, being a 126 percent upfront and 216 percent maximum premium to the 10 April close. Shareholders approved on 12 September 2025 and the transaction closed 25 September 2025, with Nasdaq delisting on 25 September and TSX on 26 September. An independent valuation set CVR fair value at $0.80 as of 24 September 2025.

CVR mechanics run off the EGRIFTA franchise: at each of the 12, 24, and 36-month anniversaries, 50 percent of annual gross profit above $40 million, plus a one-time $10 million if gross profit exceeds $150 million within 36 months.

ESSA Pharma. A holder since 2019 and approximately 9.7 percent owner as of January 2025, Soleus filed a 13D and on 15 April 2025 wrote to the board urging a wind-down and return of capital, with shares near $1.60 against roughly $2.40 per share in cash. ESSA subsequently agreed a transaction with XenoTherapeutics and announced an $80 million return of capital, approximately $1.69 per share, paid around 22 August 2025 as part of winding up.

Both campaigns realised. That is a materially different posture from the passive filer Soleus was through 2024.

Portfolio of disclosed positions, as of July 2026

Amounts are transaction or round sizes, not Soleus's own cheque, which is not disclosed per deal.

Commercial databases give portfolio counts of 76 investments and 36 exits (PitchBook), approximately 45 companies (Tracxn), and 34 companies (Caplight). None reconciles to filings and all should be treated as uncorroborated.

Blue team and red team

Blue team: the case for

• A genuine purchased royalty, with the full stack documented from Bausch + Lomb through Pfizer's cut to the acquired net position
• A funded credit vehicle at $144.2 million with three disclosed structured deployments, not a one-off
• Two activist campaigns run to realisation in a single year, at Theratechnologies and ESSA
• Registered-adviser disclosure: ADV, 13F, 13D and 13G, and Form 4, with no Item 11 items. Underwritable as a name in a way a purely private manager is not
• AUM roughly seven-fold since 2021, and a Neurona position marked up by a $1.15 billion UCB acquisition

Red team: the case against

• One royalty deal. Calling Soleus a royalty buyer on a single $15 million transaction overstates the position
• The current AUM figure could not be pulled from the raw ADV and rests on a third-party mirror
• No audited performance exists. The "no down year" claim is one media report with no return series behind it
• Fund-level opacity: no LPs named, no per-strategy sizes, no credit-book composition
• The 13F book fell approximately $240 million quarter-over-quarter into March 2026, and headline AUM figures in circulation are inconsistent enough that several published numbers are simply wrong
• Post-sale the VYZULTA stream is unobservable, so the one royalty position cannot be tracked from outside

Implications for the pharmaceutical royalty and biotech capital markets

Soleus matters here in three ways.

As a royalty buyer, the Nicox transaction demonstrates appetite for single-product streams at $15 million, well inside the segment the large aggregators do not serve. The seller's motive is the familiar one: fund the lead asset without dilution.

As a structured lender, the credit fund competes for the same non-dilutive situations royalty desks pursue, using senior secured paper, convertibles, and milestone-linked warrant tranches. Quoin's structure, with tranches tied to a programme milestone and a potential PRV sale, is closer to royalty thinking than a standard term loan.

As an activist, Soleus has shown it will force liquidity events at small caps where the board resists. For anyone holding or underwriting paper in a name where Soleus sits above 5 percent, that is a live variable rather than a passive one.

The distinction from a dedicated royalty firm remains: royalties are one instrument in a broad healthcare book, not the mandate.

Recent developments, as of July 2026

• Neurona: UCB agreed on 17 April 2026 to acquire the company for $650 million upfront plus up to $500 million in milestones, completed 2 June 2026. Soleus participated in the April 2025 round at $102 million
• Adlai Nortye: participated in a $150.0 million PIPE announced 16 April 2026
• Prelude Therapeutics: participated in a $90.0 million offering led by RA Capital, priced 20 April 2026; Fund III filed a 13G on 8 July 2026
• Compass Pathways: $150 million offering priced February 2026, coinciding with a reported Soleus exit
• Q1 2026 13F: approximately $2.47 billion, approximately 93 positions, filed 14 May 2026
• Credit Opportunities Fund I: $144,235,000 sold as of the September 2025 amendment. No Fund II filed
• Nicox VYZULTA remains the only identified royalty interest

Financial history and recent developments

Conclusion

Soleus Capital is a healthcare specialist that has roughly seven-folded regulatory AUM since 2021 and, in the process, added two capabilities that put it inside this publication's subject rather than adjacent to it. The first is a purchased royalty: Nicox's net VYZULTA stream, at $15 million, with the tiered stack and Pfizer deduction documented. The second is a $144.2 million credit fund that has since deployed structured, non-dilutive paper into Pillar, Quoin, and Longeviti, competing for situations royalty desks also see.

The 2025 activism at Theratechnologies and ESSA is the third development, and the one that most changes how a counterparty should read a Soleus position on a share register.

The constraints are real. One royalty deal is a starting position, not a franchise. The current AUM figure could not be lifted from the raw ADV. There is no audited performance. And once the VYZULTA stream moved inside a private fund, its performance stopped being observable, which is a reminder of what monetisation does to a disclosure trail.

Items to watch: a Credit Opportunities Fund II filing, which would signal the franchise scaling; a second royalty or revenue-interest purchase; whether the Nicox warrants are exercised; Bausch Health disclosure that would let the acquired stream be sized from outside; and any new 13D.

All information in this article was accurate as of the publication date and is derived from publicly available sources including SEC filings, Form ADV and Form D records, company and partner press releases, and commercial databases. Soleus Capital is a private manager and does not publish fund-level financials; figures shown are regulatory assets under management, offering amounts, or transaction sizes disclosed by counterparties, not per-strategy committed capital or the firm's own per-deal capital. The 31 December 2025 regulatory AUM figure derives from a third-party Form ADV mirror and has not been confirmed against the raw filing. Information may have changed since publication. This content is for informational purposes only and does not constitute investment, legal, or financial advice. The author is not a lawyer or financial adviser.