UK biotech financing in 2022
The UK’s innovative life sciences and biotech sector secured its fifth best fundraising year ever in 2022, with £1,785 million raised by UK-headquartered public and private companies across the year. While positive, this overall figure masks a mixed picture for the sector.
The public markets were particularly difficult, with investor appetite low, new launches were almost unseen. In fact, Initial Public Offerings (IPOs) raised just £28 million – the worst annual haul since 2012.
However, despite depressed share prices on both sides of the Atlantic, existing public companies with a positive story to tell were still able to raise capital despite the bear market. £547 million was raised by UK biotech companies in follow-ons in 2022, making it a very average year historically.
The venture markets saw much better action, achieving the third-best year on record with £1,210 million raised. Early-rounds, including seed, were relatively buoyant but later stage deals were thin on the ground and companies struggled to raise the larger deal sizes the UK sector has become more accustomed to in recent years. Nonetheless, the UK maintained its position as Europe’s pre-eminent biotech sector, accounting for more than a third of the total venture capital (VC) raised across the continent.
Beyond equity capital, there was heightened M&A and licensing activity in 2022 as larger companies in particular looked to restock and strengthen their product pipelines with UK-sourced innovation. Some UK companies also came of age with their first successful pivotal trials and regulatory approvals.