UK Biotech success continues as sector secures a record year of investment in 2020

New data published today by the UK BioIndustry Association (BIA) and Clarivate PLC reveals that UK biotech companies raised a record £2.8 billion in equity finance in 2020.

The science of success: UK biotech in 2020, marks the best year for biotech investments ever recorded by the trade association and shows that since 2012 investment has increased by over 1000%.

The breakdown of investments:

• Venture capital financings secured £1,389m, with five companies each raising over £50m in the year
   
• Initial Public Offerings (IPOs) netted £244m, including two £100m+ launches on NASDAQ
   
• All other public financings raised £1,176m, with both London’s AIM and New York’s NASDAQ being equally buoyant in the year.
   

Notable investments: 

• Cell therapy company Freeline Therapeutics raised £219m across the year in a £100m extended Series C deal followed by a £119m IPO on NASDAQ.
   
• Oxford Nanopore, which produces genetic sequencing technology used to detect COVID-19, raised a total of £162.8m in fresh capital 

• Cancer therapy company Immunocore secured the largest individual venture capital deal of just over £100m

The UK is considered to be the third global life sciences cluster, rivalling San Francisco and Boston Massachusetts, and is home to 6,300 life science companies, 80% of which are SMEs.

The data shows that the UK sector is in a strong position for growth in 2021 with its success set to continue. A number of large deals are known to be in the pipeline and  Sanofi’s deal to buy Cambridge-based Kymab for $1.45bn announced in January represents the largest acquisition of a privately listed UK biotech company on record.

Steve Bates OBE, Chief Executive of the BIA, said: “This record level of investment shows the vibrancy and strength of the UK life sciences ecosystem. Home to world leading companies and researchers, underpinned by a successful industrial strategy, this fantastic investment picture means the UK will continue to be a global player in bringing innovative treatments to patients, and as a key economic engine, in the UK’s recovery from COVID-19.

“UK biotech companies have been at the heart of international efforts to create vaccines, therapeutics and diagnostics to tackle the pandemic and continue to push the frontier of innovative new therapies, whether in cell and gene therapies, genomics and digital health technologies. Global investors recognise this, and we at the BIA are keen to see more UK-based investors benefit from the major opportunity on their doorstep. As UK pensioners benefit from COVID-19 vaccines, I urge them to ask their pension fund trustees and advisors what they are doing to invest in this critical UK success story.”

Nadhim Zahawi, Minister for Life Sciences, said: “The UK’s life sciences sector is flourishing and over the past year we have seen first-hand our leading biotech businesses step up in helping us to tackle coronavirus – from creating lifesaving vaccines to developing innovative therapies and treatments.

“Backed by record levels of investment and supported through our Life Sciences Industrial Strategy, I look forward to seeing the UK biotech industry continue to thrive as we build back better.”

Kate Bingham, Former Chair of the UK Government Vaccine Taskforce and Managing Partner at SV Health Investors, said: “The UK Vaccine Taskforce, which I chaired, has helped position the UK at the forefront of global vaccine R&D and manufacturing during this COVID-19 pandemic. The successes and innovation we have seen in the UK was based on the astonishing contribution, foresight, commitment, and generosity of the UK biotech community. The UK now needs to maintain this momentum and levels of innovation, and extend it across all therapeutic, diagnostic and Healthtech sectors so we can build well financed and world leading UK companies that can help save lives around the world.”

Judith Hartley, CEO of British Patient Capital said: “Today’s report is an important contribution to increasing the understanding of the financing landscape for UK biotech. Advances in areas such as artificial intelligence, computational biology and bioinformatics, present compelling investment opportunities. As an institutional investor with significant commitments to UK life sciences-focused venture capital, we also see increasing opportunities in later-stage funding, or Series B+.  As the report shows, there is a continuation of the long-term trend of venture backed life sciences companies remaining private for longer. As a result, we expect more institutional investors to gain exposure to some of the UK’s most promising biotech companies via venture and venture growth funds.”

Mike Ward, Global Head of Thought Leadership, DRG, a part of Clarivate, said: “The prospects for biotech companies to raise additional capital from venture sources in the coming years are promising as new life science funds continue to be launched. In 2020, venture capital firms were able to raise more than £15.8bn, money that has been earmarked for entrepreneurial life science companies.”

ENDS

Notes to Editors

2. To read The science of success: UK biotech in 2020, please follow this link.

3. The data in The science of success: UK biotech in 2020, covers investments from 01 December 2019 to 30 November 2020, the BIA have been producing these investment reports since 2012. The Sanofi acquisition of Kymab and the recent IPO by Immunocore, are not recorded in this data set.

4. To read the analysis of UK quoted biotech investment, please follow this link.  

5. To read analysis on the UK biotech’s sector contribution to the UK economy, 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 solutions to accelerate the lifecycle of innovation. Our bold mission is to help customers solve some of the world’s most complex problems by providing actionable information and insights that reduce the time from new ideas to life-changing inventions in the areas of science and intellectual property. We help customers discover, protect and commercialize their inventions using our trusted subscription and technology-based solutions coupled with deep domain expertise. For more information, please visit clarivate.com.

About SV

SV Health Investors is a leading healthcare fund manager committed to investing in tomorrow’s healthcare breakthroughs. The SV family of funds invests across stages, geographic regions, and sectors, with expertise spanning biotechnology, dementia, healthcare growth, healthcare technology and public equities. With approximately $2.2B in assets under management and a truly transatlantic presence with offices in Boston and London, SV has built an extensive network of talented investment professionals and experienced industry veterans. Since its founding in 1993, SV has invested in more than 200 companies with more than 90 of these having achieved successful acquisitions or IPOs. For more information please see www.svhealthinvestors.com.

 

About British Patient Capital

British Patient Capital is the trading name of British Patient Capital Limited, a wholly-owned commercial subsidiary of British Business Bank plc, the UK government’s economic development bank. It forms part of the British Business Bank’s commercial arm.

Its mission is to enable long-term investment in innovative firms led by ambitious entrepreneurs who want to build large scale businesses. Launched in June 2018, British Patient Capital has £2.5bn to invest over 10 years in venture and venture growth capital to support high growth potential innovative UK businesses in accessing the long-term financing they require to scale up. Find out more at britishpatientcapital.co.uk.