Features | Partner Sites | Information | LinkXpress
Sign In
GLOBETECH MEDIA
GLOBETECH PUBLISHING LLC
GLOBETECH PUBLISHING LLC

A Surge in IPOs Revitalize Investments for the Global Pharma and Biotech

By BiotechDaily International staff writers
Posted on 16 Jun 2014
Anti-infective drugs, oncology, and pharmaceutical contract laboratories attract the most investment up to now.

The intensified private equity and venture capital (PEVC) deal activity in the global healthcare industry during the recession years, 2008–2010, witnessed a waning post-2010. However, the decline in deals was not uniform among the constituent sectors, with the biotechnology, pharmaceutical, and healthcare equipment sectors experiencing a much sharper decline in investor interest than the healthcare technology and provider segments. Investors began to gamble on providers based with the conviction they can provide faster and safer returns than the pharmaceutical and biotechnology space, which is ridden with regulatory challenges and patent expiries.

A new market analysis from Frost & Sullivan’s (Mountain, View, CA, USA), an international growth consultancy firm, revealed the total number of PEVC transactions in the pharmaceutical and biotechnology industry decreased from 1063 in 2010 to 480 in 2013. Although the returns from the pharmaceutical and biotechnology industry have been declining, they are better compared to the performance of other industries.

“PE deals in the pharmaceutical sector have been relatively stable over the post-recession period whereas activity in the biotechnology segment began to decrease after reaching its peak in 2010, due to the uncertainty caused by healthcare reform in the US, long incubation periods, and delayed approvals,” said Frost & Sullivan financial analyst Dr. E. Saneesh. “VC deals across both these sectors also started to plummet from 2011 due to risks associated with regulatory uncertainty, long gestation periods, and increased cost of production.”

However, the strong rebirth of initial public offerings (IPOs) in 2013 indicates a positive outlook for investment in the pharmaceutical and biotechnology industry. The number of IPOs in the global biotechnology sector surged by 100% between 2012 and 2013, primarily on account of the 26 IPOs that took place in the United States. IPOs in the pharmaceutical industry also climbed with 11 deals in 2013, after the volume of IPOs declined to nearly one-sixth of the sector’s value between 2011 and 2012.

As a result of the surge in IPOs, exit opportunities are expected to increase for investors. The trend will be further fuelled by the anticipated growth of corporate investor-backed IPOs. “PEVC investors in the global pharmaceutical and biotechnology industry have demonstrated maximum interest in oncology drugs, followed by anti-infective drugs and pharmaceutical contract laboratories,” stated Dr. Saneesh. “They have also concluded the maximum pharmaceutical- and biotechnology-related PEVC deals in the US and are expected to continue to do so in the forthcoming years. Industry players most aligned with these trends will be well positioned to obtain financial support from PEVC investors.”

Related Links:

Frost & Sullivan



Channels

Genomics/Proteomics

view channel
Image: Transmission electron micrograph of norovirus particles in feces (Photo courtesy of Wikimedia Commons).

Norovirus Interacts with Gut Bacteria to Establish a Persistent Infection That Can Be Blocked by Interferon Lambda

A team of molecular microbiologists and virologists has found that norovirus requires an intimate interaction with certain gut bacteria to establish a persistent infection, and that the infective process... Read more

Biochemistry

view channel

Possible New Target Found for Treating Brain Inflammation

Scientists have identified an enzyme that produces a class of inflammatory lipid molecules in the brain. Abnormally high levels of these molecules appear to cause a rare inherited eurodegenerative disorder, and that disorder now may be treatable if researchers can develop suitable drug candidates that suppress this enzyme.... Read more

Therapeutics

view channel
Image: Cancer cells infected with tumor-targeted oncolytic virus (red). Green indicates alpha-tubulin, a cell skeleton protein. Blue is DNA in the cancer cell nuclei (Photo courtesy of Dr. Rathi Gangeswaran, Bart’s Cancer Institute).

Innovative “Viro-Immunotherapy” Designed to Kill Breast Cancer Cells

A leading scientist has devised a new treatment that employs viruses to kill breast cancer cells. The research could lead to a promising “viro-immunotherapy” for patients with triple-negative breast cancer,... Read more

Lab Technologies

view channel
Image: MIT researchers have designed a microfluidic device that allows them to precisely trap pairs of cells (one red, one green) and observe how they interact over time (Photo courtesy of Burak Dura, MIT).

New Device Designed to See Communication between Immune Cells

The immune system is a complicated network of many different cells working together to defend against invaders. Effectively combating an infection depends on the interactions between these cells.... Read more
 
Copyright © 2000-2015 Globetech Media. All rights reserved.