InvestorWatch: UK Record Year in Life Science Sector Financings as Capital Circulates Looking for Rich Opportunity

InvestorWatch UK Record Year in Life Science Sector Financings as Capital Circulates Looking for Rich Opportunity

With enormous sums of capital managed in the UK, its managers seek optimal scientific-based investments to not only progress health and medicine but also generate what they hope to become huge returns .  The bio-pharma industry, including the supporting clinical research sector, has considerable influence on the economy of the United Kingdom and economic, social and political ties to the Conservative Party in that nation. Back in 2010 when David Cameron came into power, boosted by a number of research and development initiatives and policies, now the UK has solidified its position as a global hub for biomedical research in part due to the sprawling National Health Service (NHS), a socialized health service, role as backer and supporter of research across the land. Last month, the UK Bioindustry Association authored a report declaring that a record $3.9 billion in equity financing went into the life science research sector.

UK Life Sciences Hub

That report revealed that the COVID-19 pandemic actually boosted the sector with investment rising from £1.8 billion ($2.5 billion) in 2019 to £2.8 billion ($3.9 billion) in 2020. That’s right, COVID-19 led to a record investment year for life sciences (biotech, pharmaceuticals, diagnostics and devices) in 2020 well supplanting the £2.2 billion UK life science investment high of 2018 reports the Bio Industry Association and Clarivate report. Overall the amount of investment into this sector increased from 2012 to present at a rate of 1,000%.

Of this total, nearly £1.4 billion of the investments were in the form of venture capital financings, nearly double last year. While generally it’s harder for life science startups to raise seed and early-stage capital, this year the conditions for such financings improved.

COVID-19 Drives Financings

In the UK, this year’s big venture deals include a 163 million raise, involving Nanopore in Oxford. This firm may be headed toward an IPO. The company develops a device used for DNA sequencing and has been in use to monitor SARS-CoV-2 variants. The region’s second largest VC financing was a bit over £100 million into a venture called Immunocore, a cancer therapy biotech. This firm sought to raise $200 million in a bid to raise the capital to conduct a Phase 3 T cell therapy trial targeting uveal melanoma late last year.

What happened? Well, they went on to raise $75 million in a C round in the first of this year and wrapped up its IPO in February, raising $312.1 million

All total, there were three UK-based life science IPOs in 2020 totaling £244 million. While this trend, a lower total number of IPOs, possibly suggests the influence of private equity keeping firms privately held for longer stretches while they build value.

At least five life science-based startups raised at least $50 million in one round last year.

Call to Action: Follow the link to read the report.

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