SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934
For the Quarterly Period Ended September 30, 1995
Commission file number 33-21281
WESTMED VENTURE PARTNERS 2, L.P.
================================================================================
(Exact name of registrant as specified in its charter)
Delaware 13-3473015
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(State of organization) (I.R.S. Employer Identification No.)
Oppenheimer Tower, World Financial Center
New York, New York 10281
================================================================================
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 667-7000
Not applicable
================================================================================
Former name, former address and former fiscal year, if changed since last report
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
<PAGE>
WESTMED VENTURE PARTNERS 2, L.P.
INDEX
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
Balance Sheets as of September 30, 1995 (Unaudited) and December 31, 1994
Schedule of Portfolio Investments as of September 30, 1995 (Unaudited)
Statements of Operations for the Three and Nine Months Ended September 30, 1995
and 1994 (Unaudited)
Statements of Cash Flows for the Nine Months Ended September 30, 1995 and 1994
(Unaudited)
Statement of Changes in Partners' Capital for the Nine Months Ended September
30, 1995 (Unaudited)
Notes to Financial Statements (Unaudited)
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
Item 2. Changes in Securities.
Item 3. Defaults upon Senior Securities.
Item 4. Submission of Matters to a Vote of Security Holders.
Item 5. Other Information.
Item 6. Exhibits and Reports on Form 8-K.
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
WESTMED VENTURE PARTNERS 2, L.P.
BALANCE SHEETS
<TABLE>
September 30, 1995 December 31,
(Unaudited) 1994
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Portfolio investments, at fair value
(cost $9,052,255 at September 30, 1995 and
$8,364,551 at December 31, 1994) - Notes 2 and 4 $ 6,606,010 $ 6,252,798
Cash and cash equivalents 6,264,007 6,969,849
Accrued interest receivable and other assets 52,821 28,887
---------------- ----------------
TOTAL ASSETS $ 12,922,838 $ 13,251,534
================ ================
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Accounts payable and accrued expenses $ 25,818 $ 25,148
Due to Managing General Partner - Note 4 100,486 66,057
Due to Independent General Partners - Note 4 11,250 15,000
---------------- ----------------
Total liabilities 137,554 106,205
---------------- ----------------
Partners' Capital:
Managing General Partner 127,853 131,453
Limited Partners (38,727 Units) 12,657,431 13,013,876
---------------- ----------------
Total Partners' capital 12,785,284 13,145,329
---------------- ----------------
TOTAL LIABILITIES AND PARTNERS' CAPITAL $ 12,922,838 $ 13,251,534
================ ================
</TABLE>
See notes to financial statements.
<PAGE>
WESTMED VENTURE PARTNERS 2, L.P.
SCHEDULE OF PORTFOLIO INVESTMENTS (UNAUDITED)
September 30, 1995
Active Portfolio Investments:
<TABLE>
Initial Investment
Company / Position Date Cost Fair Value
<C> <C> <C> <C>
Gliatech, Inc.*(A)(B)
600,000 shares of Preferred Stock Feb. 1992 $ 962,009 $ 1,110,000
Warrant to purchase 100,000 shares of Preferred Stock
at $1.50 per share, expiring 7/29/99 0 0
- -------------------------------------------------------------------------------------------------------------------------------
Hepatix, Inc.*(C)
668,346 shares of Preferred Stock Jan. 1992 1,091,913 334,173
398,603 10% Convertible Note due 6/30/97 422,554 422,554
Warrant to purchase 797,206 shares of Common Stock
at $.01 per share, expiring 10/2/00 0 395,220
-------------- ---------------
1,514,467 1,151,947
- -------------------------------------------------------------------------------------------------------------------------------
IVF America, Inc.(A)
211,672 shares of Common Stock Mar. 1989 2,322,426 438,637
Warrant to purchase 18,340 shares of Common Stock
at $10.34 per share, expiring 7/31/96 0 0
- -------------------------------------------------------------------------------------------------------------------------------
KeraVision, Inc.(A)(D)
68,728 shares of Common Stock Nov. 1992 530,300 563,140
- -------------------------------------------------------------------------------------------------------------------------------
La Jolla Pharmaceutical Company(A)
100,383 shares of Common Stock Nov. 1991 678,579 380,200
25,076 warrants to purchase 12,538 shares of Common
Stock at $6 per share, expiring 6/3/99 0 21,402
Warrant to purchase 5,015 shares of Common Stock
at $5 per share, expiring 6/3/99 0 0
-------------- ---------------
678,579 401,602
- -------------------------------------------------------------------------------------------------------------------------------
Sennes Drug Innovations, Inc.*
2,750,000 shares of Preferred Stock June 1993 1,175,579 1,175,579
412,500 shares of Common Stock 4,375 4,375
-------------- ---------------
1,179,954 1,179,954
- -------------------------------------------------------------------------------------------------------------------------------
Synaptic Pharmaceutical Corporation
432,870 shares of Preferred Stock June 1991 797,167 797,167
- -------------------------------------------------------------------------------------------------------------------------------
Targeted Genetics, Inc.(A)(E)
225,395 shares of Common Stock June 1992 1,067,353 963,563
Warrant to purchase 16,666 shares of Common Stock
at $4.68 per share, expiring 7/31/97 0 0
- -------------------------------------------------------------------------------------------------------------------------------
Totals from Active Portfolio Investments $ 9,052,255 $ 6,606,010
==================================
</TABLE>
<PAGE>
WESTMED VENTURE PARTNERS 2, L.P.
SCHEDULE OF PORTFOLIO INVESTMENTS (UNAUDITED) - continued
September 30, 1995
SUPPLEMENTAL INFORMATION: LIQUIDATED PORTFOLIO INVESTMENTS(F)
<TABLE>
Cost Realized Loss Return
<S> <C> <C> <C>
Total from Liquidated Portfolio Investments $ 5,149,819 $ (2,909,857) $ 2,239,962
==========================================================
Combined Combined
Unrealized and Fair Value
Cost Realized Loss and Return
Totals from Active and Liquidated Portfolio
Investments $ 14,202,074 $ (5,356,102) $ 8,845,972
==========================================================
</TABLE>
(A) Public company
(B) On October 18, 1995, Gliatech, Inc. completed its initial public offering.
In connection with the offering, Gliatech effected a 1-for-5 reverse split
of its common stock. As a result, the Partnership exchanged its 600,000
preferred shares of Gliatech for 120,000 shares of the Company's common
stock. Additionally, in connection with the offering, the Partnership
exchanged its warrant to purchase 100,000 shares of preferred stock of
Gliatech for 4,210 common shares of the Company in a non-cash transaction,
pursuant to a cashless exercise provision in the warrant agreement.
(C) During the quarter, the Partnership made follow-on investments in Hepatix,
Inc. totaling $365,896 including $20,907 of venture capital fees paid to
the Managing General Partner relating to this investment. In connection
with a financial restructuring of the company, the new investment and
previously held convertible notes were exchanged for a new convertible note
with a face value of $398,603 maturing on June 30, 1997 and a warrant to
purchase 797,206 common shares of Hepatix at $.01 per share.
(D) In July 1995, KeraVision, Inc. completed its initial public offering and
effected a 1-for-2.5 reverse split of its outstanding stock. As a result,
the Partnership exchanged its 171,821 shares of preferred stock of
KeraVision for 68,728 shares of the company's common stock.
(E) On July 13, 1995, the Partnership made a follow-on investment totaling
$265,150 in Targeted Genetics Corporation, acquiring 66,664 shares of
common stock and a warrant to purchase an additional 16,666 shares of
common stock at $4.68 per share.
The Partnership paid a $15,150 venture capital fee relating to this
investment.
(F) Amounts provided for "Supplemental Information: Liquidated Portfolio
Investments" are cumulative from inception through September 30, 1995.
* Company may be deemed an affiliated person of the Partnership as such term is
defined in the Investment Company Act of 1940.
See notes to financial statements.
<PAGE>
WESTMED VENTURE PARTNERS 2, L.P.
STATEMENTS OF OPERATIONS (UNAUDITED)
<TABLE>
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
------------- ------------- ------------- --------
<S> <C> <C> <C> <C>
INVESTMENT INCOME AND EXPENSES
Income:
Interest from short-term investments $ 96,450 $ 77,865 $ 294,400 $ 201,313
Interest and dividend income from portfolio
investments 3,170 (232) 3,383 1,260
------------- ------------- ------------- -------------
Totals 99,620 77,633 297,783 202,573
------------- ------------- ------------- -------------
Expenses:
Management fee - Note 4 64,429 66,733 199,149 206,270
Professional fees 15,550 15,113 39,624 31,712
Mailing and printing 8,513 1,100 19,887 5,409
Insurance expense 16,037 8,635 47,120 16,910
Custodial fees 1,753 1,300 5,193 4,811
Independent General Partners' fees - Note 4 3,750 3,750 11,250 11,250
Miscellaneous 60 - 1,113 461
------------- ------------- ------------- -------------
Totals 110,092 96,631 323,336 276,823
------------- ------------- ------------- -------------
NET INVESTMENT LOSS (10,472) (18,998) (25,553) (74,250)
Net change in unrealized appreciation or
depreciation of investments (577,899) (310,132) (334,492) (77,653)
------------- ------------- ------------- -------------
NET DECREASE IN NET ASSETS
RESULTING FROM OPERATIONS
(allocable to Partners) - Note 3 $ (588,371) $ (329,130) $ (360,045) $ (151,903)
============= ============= ============= =============
</TABLE>
See notes to financial statements.
<PAGE>
WESTMED VENTURE PARTNERS 2, L.P.
STATEMENTS OF CASH FLOWS (UNAUDITED)
For the Nine Months Ended September 30,
<TABLE>
1995 1994
-------------- ---------
<S> <C> <C>
CASH FLOWS USED FOR OPERATING ACTIVITIES
Net investment loss $ (25,553) $ (74,250)
Adjustments to reconcile net investment loss to cash used for operating
activities:
Increase (decrease) in payables 31,349 (23,869)
Increase in other assets (27,317) (26,852)
-------------- ---------------
Cash used for operating activities (21,521) (124,971)
-------------- ---------------
CASH FLOWS USED FOR INVESTING ACTIVITIES
Purchase of portfolio investments (684,321) (1,383,740)
-------------- ---------------
Decrease in cash and cash equivalents (705,842) (1,508,711)
Cash and cash equivalents at beginning of period 6,969,849 8,474,632
-------------- ---------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 6,264,007 $ 6,965,921
============== ===============
</TABLE>
See notes to financial statements.
<PAGE>
WESTMED VENTURE PARTNERS 2, L.P.
STATEMENT OF CHANGES IN PARTNERS' CAPITAL (UNAUDITED)
For the Nine Months Ended September 30,
<TABLE>
Managing
General Limited
Partner Partners Total
<S> <C> <C> <C>
Balance at beginning of period $ 131,453 $ 13,013,876 $ 13,145,329
Net increase in net assets resulting
from operations - Note 3 (3,600) (356,445) (360,045)
------------- --------------- ----------------
Balance at end of period $ 127,853 $ 12,657,431(A) $ 12,785,284
============= =============== ================
</TABLE>
(A) The net asset value per unit of limited partnership interest, including an
assumed allocation of net unrealized depreciation of investments, was $327
at September 30, 1995. Such per Unit amount is based on average allocations
to all limited partners and does not reflect specific limited partner
allocations, which are determined by the original closing date associated
with the units of limited partnership interest held by each limited
partner.
See notes to financial statements.
<PAGE>
WESTMED VENTURE PARTNERS 2, L.P.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. Organization and Purpose
WestMed Venture Partners 2, L.P. (the "Partnership") was formed under Delaware
law in April 1988. The Partnership operates as a business development company
under the Investment Company Act of 1940, as amended. The Partnership is a
closed-end investment fund and accordingly its units of limited partnership
interest ("Units") are not redeemable by the Partnership. A total of 38,727
Units were sold to limited partners ("Limited Partners" and together with the
Managing General Partner (as hereinafter defined), the "Partners") at $500 per
Unit.
The general partners of the Partnership include three individuals (the
"Independent General Partners") and the managing general partner, WestMed
Venture Management 2, L.P., a Delaware limited partnership (the "Managing
General Partner" and collectively with the Independent General Partners, the
"General Partners"). The general partner of the Managing General Partner is
Medical Venture Holdings, Inc., a Delaware corporation affiliated with
Oppenheimer & Co., Inc. ("Opco"). The limited partners of the Managing General
Partner are Oppenheimer Holdings, Inc., MVP Holdings, Inc. and BSW, Inc., a
Delaware corporation owned by John A. Balkoski, Philippe L. Sommer and Howard S.
Wachtler. Messrs. Sommer and Wachtler are principally responsible for managing
the investments of the Partnership.
Opco, a member firm of the New York Stock Exchange, the National Association of
Securities Dealers, Inc., and all principal United States securities exchanges,
is a diversified investment banking and securities firm, a registered investment
advisor and Futures Commission Merchant providing a broad range of services to
individual, corporate, and institutional clients. Opco operates in the capacity
of broker and dealer for its customers, as well as trader for its own account.
The services provided by Opco and its subsidiaries, and the activities in which
it is engaged, include securities brokerage, securities research, customer
financing, securities trading, corporate finance, mergers and acquisitions,
underwriting and investment advisory services.
The Partnership's objective is to achieve long-term capital appreciation from
its portfolio of venture capital investments, consisting of companies engaged in
the health care industry. The Partnership is scheduled to terminate on December
31, 1998. However, the General Partners can extend the term for up to two
additional two-year periods, if they determine that such extensions are in the
best interest of the Partnership.
2. Summary of Significant Accounting Policies
Valuation of Investments - Portfolio investments are carried at fair value as
determined quarterly by the Managing General Partner under the supervision of
the Independent General Partners. The fair value of publicly-held portfolio
securities is adjusted to the average closing public market price for the last
five trading days of each quarter discounted for sales restrictions. Factors
considered in the determination of an appropriate discount include, underwriter
lock-up or Rule 144 trading restrictions, insider status where the
<PAGE>
WESTMED VENTURE PARTNERS 2, L.P.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
Partnership either has a representative serving on the board of directors of the
portfolio company under consideration or is greater than a 5% shareholder
thereof, and other liquidity factors such as the size of the Partnership's
position in a given company compared to the trading history of the public
security. Privately-held portfolio securities are carried at cost until
significant developments affecting the portfolio company provide a basis for
change in valuation. The fair value of private securities is adjusted (i) to
reflect meaningful third-party transactions in the private market and (ii) to
reflect significant progress or slippage in the development of the company's
business such that cost is no longer reflective of fair value. As a venture
capital investment fund, the Partnership's portfolio investments involve a high
degree of business and financial risk that can result in substantial losses. The
Managing General Partner considers such risks in determining the fair value of
the Partnership's portfolio investments.
Investment Transactions - Investment transactions are recorded on the accrual
method. For portfolio investments, transactions are recorded on the date which
the Partnership obtains an enforceable right to demand the securities or payment
thereof. Realized gains and losses on investments sold are computed on a
specific identification basis.
Statements of Cash Flows - Cash and cash equivalents include short-term
interest-bearing investments in commercial paper and other money market
investments. The Partnership considers its interest bearing cash account to be
cash equivalents.
Income Taxes - No provision for income taxes has been made since all income and
losses are allocable to the partners for inclusion in their respective tax
returns. The Partnership's net assets for financial reporting purposes differ
from its net assets for tax purposes. Net unrealized depreciation of $2.4
million at September 30, 1995, which was recorded for financial statement
purposes, was not recognized for tax purposes. Additionally, from inception to
September 30, 1995, other timing differences totaling $2.2 million, primarily
relating to original sales commissions paid and other costs of selling the
Units, have been recorded on the Partnership's financial statements but have not
yet been deducted for tax purposes.
3. Allocations of Partnership Profits and Losses
Pursuant to the Partnership's agreement of limited partnership (the "Partnership
Agreement"), the Partnership's net income and net realized gains from all
sources are allocated to all Partners, in proportion to their capital
contributions, until all Partners have been allocated an amount (the "Priority
Return") equal to 6% per annum, simple interest, on their total Adjusted
Invested Capital; i.e., original capital contributions reduced by previous
distributions. Thereafter, net income and net realized gains from venture
capital investments in excess of the amount used to cover the Priority Return
are allocated 20% to the Managing General Partner and 80% to all Partners in
proportion to their capital contributions. Any net income from
<PAGE>
WESTMED VENTURE PARTNERS 2, L.P.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
non-venture capital investments in excess of the amount used to cover the
Priority Return is allocated to all Partners in proportion to their capital
contributions. Realized losses are allocated to all Partners is proportion to
their capital contributions. However, if realized gains had been previously
allocated in the 80-20 ratio, then losses are allocated in the reverse order in
which profits were allocated. From its inception to September 30, 1995, the
Partnership had a $2.7 million net realized loss from its venture capital
investments.
4. Related Party Transactions
Pursuant to the Partnership Agreement, the Managing General Partner is entitled
to receive a one-time venture capital fee equal to 5% of the gross proceeds from
the sale of Units. Such fee is incurred as portfolio investments are made in the
proportion of the cost of each portfolio investment to the net proceeds from the
sale of Units. Venture capital fees incurred are recorded as a cost of acquiring
the portfolio investments. The Partnership incurred venture capital fees of
$36,100 and $79,000 for the nine months ended September 30, 1995 and 1994,
respectively. Cumulative venture capital fees incurred from inception to
September 30, 1995 totaled $813,000.
Pursuant to a management agreement between the Partnership and the Managing
General Partner, the Managing General Partner performs, or arranges for others
to perform, the management, administrative and certain investment advisory
services necessary for the operation of the Partnership. For such services, the
Managing General Partner receives a management fee at the annual rate of 2% of
the lesser of the net assets of the Partnership or the net contributed capital
of the Partnership; i.e., gross capital contributions to the Partnership (net of
selling commissions and organizational expenses) reduced by capital distributed.
Such fee is determined and payable quarterly.
For services rendered to the Partnership, each of the three Independent General
Partners receives a $5,000 annual fee and reimbursement for all out-of-pocket
expenses relating to attendance at meetings of the General Partners.
5. Interim Financial Statements
In the opinion of the Managing General Partner, the unaudited financial
statements as of September 30, 1995, and for the three and nine month periods
then ended, reflect all adjustments necessary for the fair presentation of the
results of the interim period.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Liquidity and Capital Resources
During the three months ended September 30, 1995, the Partnership made follow-on
investments in Hepatix, Inc. totaling $366,000 and in Targeted Genetics
Corporation for $265,000. From its inception through September 30, 1995, the
Partnership had invested an aggregate of $14.2 million in ten portfolio
companies (including acquisition costs and venture capital fees totaling
$912,000) representing approximately 82% of the original $17.3 million of net
proceeds received from the offering of Units.
At September 30, 1995, the Partnership held $6.3 million in cash and short-term
investments: $6.0 million in short-term securities with maturities of less than
one year and $275,000 in an interest-bearing cash account. Such investments
provide the Partnership with the liquidity necessary to make additional
investments in venture situations as opportunities for investment arise. The
Partnership earned $96,000 and $294,000 of interest from such investments for
the three and nine months ended September 30, 1995, respectively. Interest
earned from short-term investments in future periods is subject to fluctuations
in short-term interest rates and changes in funds available for investment.
It is anticipated that funds needed to cover the Partnership's future
investments and operating expenses will be obtained from existing cash reserves,
interest and dividend income and proceeds realized from the sale of portfolio
investments.
Results of Operations
Investment Income and Expenses - For the three months ended September 30, 1995
and 1994, the Partnership had net investment losses (investment income less
operating expenses) of $10,000 and $19,000, respectively. Net investment loss
for the nine months ended September 30, 1995 and 1994 was 26,000 and 74,000,
respectively. The decline in net investment loss for the 1995 periods compared
to the 1994 periods primarily was due to an increase in interest income from
short-term investments due to higher short-term interest rates during the 1995
periods, partially offset by increases in insurance expense and mailing costs
for the 1995 periods. The increase in insurance expense for the 1995 periods
resulted from directors and officers liability insurance which was initiated in
August 1994.
The management fee paid to the Managing General Partner, pursuant to the
management agreement between the Partnership and the Managing General Partner,
was $64,000 and $67,000 for the three months ended September 30, 1995 and 1994,
respectively. The management fee for the nine months ended September 30, 1995
and 1994 was $199,000 and $206,000, respectively. The decrease in the management
fee for the 1995 periods was due to a decrease in the Partnership's net assets
at September 30, 1995, June 30, 1995 and March 31, 1995 compared to the same
periods in 1994. To the extent possible, the management fee and other operating
expenses are paid with funds provided from operations. Funds provided from
operations are obtained from interest earned from short-term investments,
interest and dividend income from portfolio investments and proceeds received
from the sale of portfolio investments.
<PAGE>
Unrealized Gains and Losses and Changes in Unrealized Appreciation or
Depreciation of Portfolio Investments - For the nine months ended September 30,
1995, the Partnership had a $334,000 net unrealized loss resulting from the net
downward revaluation of its portfolio investments thereby decreasing unrealized
appreciation of investments for the nine month period.
For the nine months ended September 30, 1994, the Partnership had a $78,000 net
unrealized loss resulting from the net downward revaluation of its portfolio
investments thereby decreasing net unrealized appreciation of investments for
the nine month period.
Net Assets - At September 30, 1995, the Partnership's net assets were $12.8
million, a decrease of $360,000 from $13.1 million at December 31, 1994. This
decrease resulted from the $334,000 net unrealized loss from investments and the
$26,000 net investment loss for the nine month period.
At September 30, 1994, the Partnership's net assets were $13.3 million, a
decrease of $152,000 from $13.4 million at December 31, 1993. This decrease
resulted from the $78,000 net unrealized loss from investments and the $74,000
net investment loss for the nine month period.
The net asset value per $500 Unit at September 30, 1995 and December 31, 1994,
including an allocation of net unrealized depreciation of investments, was $327
and $336, respectively. Such per Unit amounts are based on average allocations
to all Limited Partners and do not reflect specific Limited Partner allocations,
which are determined by the original closing date associated with the Units held
by each Limited Partner.
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
The Partnership is not a party to any material pending legal proceedings.
Item 2. Changes in Securities.
Not applicable.
Item 3. Defaults Upon Senior Securities.
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
No matter was submitted to a vote of security holders during the quarter covered
by this report.
Item 5. Other Information.
During the quarter, the Partnership made follow-on investments in Hepatix, Inc.
totaling $365,896 including $20,907 of venture capital fees paid to the Managing
General Partner relating to this investment. In connection with a financial
restructuring of the company, the new investment and previously held convertible
notes were exchanged for a new convertible note with a face value of $398,603
maturing on June 30, 1997 and a warrant to purchase 797,206 common shares of
Hepatix at $.01 per share.
On July 13, 1995, the Partnership purchased 66,664 shares of common stock and a
warrant to purchase an additional 16,666 shares of common stock of Targeted
Genetics Corporation for $265,150. The Partnership paid a $15,150 venture
capital fee relating to this investment
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
(27) Financial Data Schedule.
(b) No reports on Form 8-K have been filed during the quarter for
which this report is filed.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
WESTMED VENTURE PARTNERS 2, L.P.
By: WestMed Venture Management 2, L.P.
The Managing General Partner
By: MEDICAL VENTURE HOLDINGS, INC.
General Partner
By: /s/ Howard S. Wachtler
Howard S. Wachtler
Executive Vice President
By: /s/ Philippe L. Sommer
Philippe L. Sommer
Executive Vice President and Principal
Financial and Accounting Officer
Date: November 14, 1995
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM WESTMED
VENTURE PARTNERS 2, L.P.'S QUARTERLY REPORT ON FORM 10-Q FOR THE PERIOD ENDED
SEPTEMBER 30, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-1-1995
<PERIOD-END> SEP-30-1995
<INVESTMENTS-AT-COST> 9,052,255
<INVESTMENTS-AT-VALUE> 6,606,010
<RECEIVABLES> 52,821
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 6,264,007
<TOTAL-ASSETS> 12,922,838
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 137,554
<TOTAL-LIABILITIES> 137,554
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 0
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (2,446,245)
<NET-ASSETS> 12,785,284
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 297,783
<OTHER-INCOME> 0
<EXPENSES-NET> 323,336
<NET-INVESTMENT-INCOME> (25,553)
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> (334,492)
<NET-CHANGE-FROM-OPS> (360,045)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (328,697)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 336
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 327
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
