Financing, Insight journal - Dealtalk

Spring Has Sprung! Venture Funding up for Biotech

Posted on 05 April 2012

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The birds are chirping, the garden is blooming and biotech is raking in the bucks – at least in the context of the past few years.

Based on BioWorld's data, the first three months of 2012 saw U.S. biotech venture rounds bringing in a rousing $391 million – a 34 percent increase compared to the same period last year.

The biggest jump showed up in the early rounds. Series A and seed deals brought in 63 percent more moola the first quarter, with a total of $98 million rolling into 11 companies. Investors put more of their cash into clinical-stage firms (25 percent vs. 7 percent for 2011) and much less of their cash into specialty pharma deals (26 percent vs. 83 percent for same period last year).

Median deal size didn't change much between 2011 ($4 million) and 2012 ($6 million).

That trend of supporting early stage innovators makes me very happy.

Those companies are the crucial engine for generating the new products that have a chance of making a significant clinical (as opposed to marketing) difference.

I realize the still-sluggish initial public offering (IPO) market means that venture investors have to have nerves of steel – not to mention brave limited partners – to stay in this game. I appreciate the vote of confidence their investments imply.

By Cynthia Robbins-Roth BioWorld Today Columnist

Read the full article at BioWorld here.

 

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