Sowood Capital Management

Sowood Capital Management was a Boston-based hedge fund founded in 2004 by Jeff Larson, the former head of foreign equity and commodities at Harvard Management Company. The firm managed approximately $3 billion at its peak and employed a multi-strategy investment approach that included credit, event-driven, and equity positions. While not a life sciences company itself, Sowood was a notable investor in the biotechnology and healthcare sectors, holding significant stakes in companies like Sirna Therapeutics. In July 2007, the firm suffered catastrophic losses exceeding 50% of its main fund's value due to a sudden downturn in the credit markets. To mitigate further losses, the firm reached an agreement to sell its investment portfolio to Citadel Investment Group and subsequently ceased operations. This collapse is frequently cited as one of the early signals of the impending global financial crisis of 2008.