Biotech Survives Difficult Opening to 2008 - In the current market crisis, biotech IPOs and financing are down, but partnering continues, and M&As are as hot as ever. - BioPharm International

ADVERTISEMENT

Biotech Survives Difficult Opening to 2008
In the current market crisis, biotech IPOs and financing are down, but partnering continues, and M&As are as hot as ever.


BioPharm International
Volume 21, Issue 6

PARTNERING AND FINANCING STILL CONTINUE, BUT AT A SLOWER PACE


Table 2. Selected venture capital deals in Q1 2008
Financing and partnering deals tracked by Burrill & Company collectively brought in approximately $6.6 billion for US companies in Q1, with more than $3.5 billion through financing and $3 billion in partnering capital. This total was the lowest raised in any quarter since 2004.


Table 3. US biotech financing ($M) in Q1 2008
The largest partnering deal in the quarter belonged to Genzyme and Isis Pharmaceuticals. Through their alliance, Genzyme will develop and commercialize mipomersen, Isis's lipid-lowering treatment for high-risk cardiovascular patients. Deal terms could add more than $1.1 billion. Genzyme will pay Isis $150 million to purchase five million shares of Isis common stock and a $175 million upfront mipomersen license fee. In addition to this initial $325 million, Isis has the potential to receive significant milestone payments for mipomersen, which is currently in Phase 3 trials. Once the product is launched, the two companies will share profits.

Although deal flow continued at roughly the same pace as in the past several quarters, financing was slow in the first quarter of 2008. The $837 million raised was the lowest since 2003. Topping the financing list was EKR Therapeutics, Inc., (Cedar Knolls, NJ) a specialty pharmaceutical company focused on acquiring, commercializing, and maximizing the potential of proprietary acute-care products, which completed a private placement of $50 million in Series D equity and $95 million in senior debt.

M&As ARE STILL HOT

Takeda Pharmaceuticals' announced $8.8 billion acquisition of Millen-nium Pharmaceuticals, which helped Millennium's share price to close April up a whopping 60%, highlighted the fact that the M&A trends that have been hot in biotech land during the past three years are not slowing down. We will continue to see these deals throughout the year. Pharma has come to rely on biotech for innovation. Both Big Pharma and Big Biotech will continue to compete for companies with advanced product pipelines and important technologies.

G. Steven Burrill is the chief executive officer at Burrill & Company, San Francisco, CA, 415.591.5400,


blog comments powered by Disqus

ADVERTISEMENT

ADVERTISEMENT

NIH Launches Human Safety Study of Ebola Vaccine Candidate
August 29, 2014
Suppliers Seek to Boost Single-Use Technology
August 21, 2014
Bristol-Myers Squibb and Celgene Collaborate on Immunotherapy and Chemotherapy Combination Regimen
August 20, 2014
FDA Warns about Fraudulent Ebola Treatments
August 15, 2014
USP Awards Analytical Research
August 15, 2014
Author Guidelines
Source: BioPharm International,
Click here