Record quarter for UK biotech as £1bn is raised

New data published today by the BioIndustry Association (BIA) and Clarivate reveals that UK biotech companies raised more than £1billion in equity finance between June and August 2020, the highest quarter for investments in the sector on record.

With £1.9billion raised to date this year, 2020 is on target to be the best year ever recorded for this rapidly expanding sector.   

The new report shows:

  • £119m was raised through the year’s first Initial Public Offering, showing continued US appetite for UK biotechs on NASDAQ
  • £282m was raised through Venture Capital, including a return to pre-COVID 19 levels of seed and early-stage VC deals
  • £601m was raised through other public financings on both London and New York exchanges as biotech share prices continue to perform well on both sides of the Atlantic  

Notable investments:

  • Freeline Therapeutics, a clinical-stage gene therapy company, topped investments with a £119m IPO on NASDAQ
  • NodThera, which is developing anti-inflammatory therapeutics, raised £41m in a series B venture capital deal
  • Bit Bio, a gene therapy company, raised £32m in a series A venture capital deal

 

The strong investment picture has been matched by rising share prices. UK biotech was outperforming the broader market before COVID-19 hit, since then its relative performance has been stronger still and there have been many new investors entering the sector on the London Stock Exchange. The long-term returns (10 years) of biotech have outperformed other sectors, including pharmaceuticals and tech, in both venture capital and public markets.

Steve Bates OBE, Chief Executive of the BIA said: “In a year where COVID-19 has caused major disruptions to the global economy it is fantastic to see the strong investment picture for UK biotech continue to gather pace.

“During the pandemic, UK biotech has shown its strategic value and received great interest from UK based investors, with many investing in the sector for the first time. This could be transformative for patients and the economy, and for shareholders, when combined with the global money we already attract – large pharma, US and Chinese venture capitalists are already aware of the vast opportunities UK biotech presents.

“This strong performance is testimony to the long-term support for life sciences delivered by successive government's industrial strategies, which have identified the sector as a key engine for economic growth. UK institutional and private investors cannot continue to miss out on this rich source of value creation.  By building expertise in this sector, a virtuous revolving door can be created where UK institutional and retail investors insightfully support growth opportunities over the medium to longer term, see the returns, and keep coming back for more.” 

Mike Ward, Global Head of Thought Leadership, DRG, a part of Clarivate, said: "Biotech companies are well positioned to deliver the clinical advances patients need. Not only have companies across the globe banked record sums this year, specialist biotech investors have in the first three quarter raised more than $16bn in new funds to support biotech in the coming years."

Lord Grimstone of Boscobel, Minister for Investment jointly at the Department for International Trade and the Department for Business, Energy & Industrial Strategy said: “I am delighted that our leading biotechnology sector has raised over £1 billion in private investment from around the globe, recognising the growth opportunity our innovative companies provide, and helping the delivery of next generation life-changing technologies and scientific breakthroughs.” 

“The Government is committed to supporting this sector, demonstrated through the Life Sciences Industrial Strategy, which highlights the impact of the work across industry, academia, the NHS, charities and Government. The strategy will help build the sector into a unique and internationally competitive life sciences ecosystem.” 

Due to growing interest in the UK biotech sector among professional and retail investors, the BIA recently published Opportunity on your doorstep: a guide to investing in the UK biotech sector The guide provides an introduction to the different sub-sectors of biotech and its applications, explains the R&D and regulatory processes and explores the different ways investors can gain exposure to the sector through a diversified portfolio. 

The data and continuing growth of the UK biotech sector, including the emergence of data and AI-enabled biotech businesses will be discussed this week at the BIA’s UK Bioscience Forum on 14 and 15 October.

Notes to Editors

  1. Please find attached to this email a copy of Biotech financing update: June - August 2020. If you are experiencing any problems with the attachment or want further information, please contact Jack Fellows, Media and Communications Manager at the BIA on 07825942934 or jfellows@bioindustry.org.
  2. The data covers the period between 1 June and 31 August 2020. The BIA have been producing these investment reports since 2012.
  3. More details of the UK biotech investment picture will be discussed at the UK Bioscience Forum on 14-15 October. To register for a press pass, please email Jack Fellows.
  4. To read Opportunity on your doorstep: A guide to investing in the UK biotech sector, please follow this link.  

 

About the BIA
 

Established over 25 years ago at the infancy of biotechnology, the BioIndustry Association (BIA) is the trade association for innovative life sciences in the UK. Our goal is to secure the UK's position as a global hub and as the best location for innovative research and commercialisation, enabling our world-leading research base to deliver healthcare solutions that can truly make a difference to people's lives.

About Clarivate

Clarivate is a global leader in providing trusted insights and analytics to accelerate the pace of innovation. Our vision is to improve the way the world creates, protects and advances innovation.