Biotech sector sees huge year-on-year private equity, venture capital investment activity jump as Covid recovery continues


Private equity and venture capital investment in the biotech sector has scored its busiest month of the past 12 as markets continue their recovery from March’s coronavirus shock.

A total of 83 PE and VC deals were recorded in September according to data from Moody’s Analytics subsidiary BvD, a 28% increase on August’s 65 deals and a huge jump on the 58 recorded in September last year.

Three deals deals broke the $100m barrier in the month under review, accounting for 25 per cent of total value for the period – although overall deal value has remained fairly stagnant these past three months.

Deals worth about $1.45bn were announced in September, BvD said, up slightly on August’s $1.4bn but down on the $1.51 result from July.

The rise in activity volume is no surprise given the generally strong performance of biotech and life sciences companies amid the Covid-19 pandemic, with plenty of PE and VC firms looking to profit from a healthy sector as others struggle.

The most valuable deal targeting the biotech sector last month featured a Chinese target, as cancer treatment maker InventisBio secured a $147m investment from Matrix Management, OrbiMed Advisors and E Fund Management, among others.

It was followed by a $110m investment in Neogene Therapeutics, while Flame Biosciences secured $100m in the third-largest deal.

All but one of the remaining top 20 deals featured targets based in either the US or China, BvD said.

The exception was the 17th-largest transaction, in which UK-headquartered MiNA Therapeutics secured £30m from aMoon Ventures.

The US was the most frequently targeted country in terms of biotech PE, VC and DC dealmaking in September 2020, and also headed up the rankings by volume.

In all companies based in the country were targeted in 52 deals worth $949m, well ahead of second-placed China’s volume of 15 deals.

No other country notched up more than 10 deals in the month under review, BvD said.

The UK placed third, with four, followed by Japan, Spain and South Korea, each of which was targeted in two deals.

In terms of value China placed second, with $415m. The UK, Finland and South Korea came next, with $35m, $18m and $15m respectively.

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