Early Stage Biopharma Financings Kept Up Multibillion-Dollar Pace In 2016
Series A venture capital and seed funding rounds for biopharma firms in 2016 kept pace with the level of investment seen in 2015, excluding one major deal in 2015, laying the foundation for optimism regarding early-stage financings in 2017 for particularly innovative companies.
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With three biopharma initial public offerings in April, the second quarter is on track to beat the first quarter's total of five IPOs – three in January and two in March – and several more are in the queue.
Biopharma companies closed out 2016 with $9.6 billion in financing, the strongest quarter of the year. M&A deals reached $12.2 billion in value, led by Lonza's takeover of Capsugel; most of the fourth quarter's largest partnerships were built around innovative platforms in antibodies, peptides and gene therapy.
Venture capital investment fell $2.1bn to $7.79bn in 2016, but it was still the second-best year of VC funding for biopharma firms since 2006. Also, Venrock and Correlation closed new health care and technology funds and 10 companies raised $126.8m.