Dive Brief:
- Biotech in the U.K. is booming, according to a new report out today from The BioIndustry Association (BIA), the U.K. biotech industry's trade body.
- The U.K. has 351 preclinical candidates in development, along with 43 Phase 1, 70 Phase 2 and 15 Phase 3 projects, making it the strongest pipeline in Europe across these stages, the report said.
- Three U.K. biotech companies — NuCana plc, Nightstar Therapeutics plc and Verona Pharma plc — listed on Nasdaq during 2017. U.K. IPOs raised twice as much money in 2017 as in 2016, while seed funding into British biotech more than doubled over the same period.
Dive Insight:
Preclinical and clinical research is thriving in the U.K., driving one of the strongest pipelines in Europe — a state of affairs BIA attributes to "the significant amount of funding that the UK invests in early stage and translational science and [to] the quality of our universities."
"The UK’s impressive preclinical and clinical pipeline shows the strength and capability of the UK biotech ecosystem to produce fantastic science that attracts talent and funding from across the globe," said Steve Bates, BioIndustry Association CEO. "There is money to be made as this pipeline develops."
The breadth and depth of this pipeline likely means that 2018 will be a busy year for U.K. life science companies, according to David Cox, healthcare specialist sales at Panmure Gordon & Co.
"In biopharma there are a number of important readouts, many of them late-stage, that could potentially transform valuations in U.K. healthcare," Cox wrote in BIA's report.
"Couple this with the fundamental long-term trends of aging populations, rising global healthcare spending and an improving regulatory environment, as the FDA takes a more pragmatic approach to approvals, the potential for outperformance continues to be favorable — even in the context of the UK quoted sector having nearly doubled in value over the past 18 months."
The number of mergers and acquisitions of U.K. biotech by international companies also demonstrates some interest in U.K. science, although the deal flow pales in comparison to the U.S.
2017 M&A activity in U.K. biotech industry
Acquirer | Company acquired | Upfront deal value, millions |
---|---|---|
Reckitt Benckiser | Mead Johnson | $16,600 |
Clinigen Group | Quantum Pharma | $200 |
Smith & Nephew | Rotation Medical | $125 |
Horizon Discovery | Dharmacon | $85 |
LivaNova | Imthera | $78 |
BTG | Roxwood Medical | $65 |
GE Healthcare | Puridify | Undisclosed |
SOURCE: Informa, company releases
The U.K. has been going through some challenging times, with the countdown to Brexit leaving European-funded science in some uncertainty. British biotech, however, appears to be fighting back, with £234 million ($333.8 million) raised in IPOs and £452 million ($644.9 million) raised in follow-on funding in 2017.
"2017 was not without its challenges for companies," wrote Bates in the report. "The uncertainty and constantly changing landscape of Brexit did not provide an easy backdrop for fundraising."
While IPO and public financing volume last year rose from 2016, venture capital funding fell sharply for the second straight year.