New Clarivate Biopharma Dealmaking Report Reveals Investment Patterns Set to Impact the Future of Medicine
Thursday, May 25, 2023
Cell therapy, RNA technology, antibody drug conjugates and AI/machine learning among key areas of investment for pharma
LONDON, May 17, 2023 /PRNewswire/ -- Clarivate Plc (NYSE:CLVT), a global leader in connecting people and organizations to intelligence they can trust to transform their world, today released its new report, Biopharma Dealmaking in 2023. This year's report examines how pharma companies are replenishing their pipelines as many face a steep patent cliff, with particular attention to such critical emerging modalities and technologies as antibody drug conjugates, artificial intelligence (AI) and machine learning, cell therapy, bispecific antibodies and RNA therapeutics.
In late 2021, investors began shifting away from biotech. In such an instance, historically, companies have turned to partnering as an alternative source of support, with the potential for an upsurge in both mergers and acquisitions (M&A) activity and biopartnering deals. However, this did not happen. Instead, during 2022, the global biotech sector saw a drop off in its ability to raise finance, with investor enthusiasm waning.
With interest rates still high across the globe and the world economy facing challenges from geopolitical tensions, biotech executives have been advised to manage their capital even more tightly, make the finds they have last longer, focus on lead programs, and find alternative sources of finance.
Leveraging data and insights from BioWorld(TM) and Cortellis Deals Intelligence(TM) paired with industry sources, the report finds:
-- According to BioWorld, the $60.8 billion collected by biopharma
companies throughout 2022 was down by 48.6% from 2021 and 54.8% from
2020.(1 )Global initial public offerings were thin on the ground, with
only 35 completed generating $4.85 billion. Biotech companies raised
$16.9 billion through 158 follow-on offerings, while there were 381
public and other financings that raised $16.86 billion and 493 private
VC rounds that raised $22.2 billion.
-- M&A activity was at its lowest level since 2013, and while the reported
bio partnering deal values for 2022 were the second highest recorded,
the number of transactions was the lowest since 2018. With the pharma
sector facing challenges when addressing R&D productivity, it continues
to rely heavily upon biotech companies for innovative ideas.
-- A geographic analysis(2) of dealmaking activity confirms that biotech
innovation is greatly influenced by American companies, but that trend
is declining. The influence of Asia-Pacific-based industry, most notably
entities based in Mainland China, is rising. In 2022, 43% of bio
partnering transactions involved at least one United States-based
company, while 15% of all transactions involved only United States-based
biotech companies. Moreover, 29% of deals involved at least one European
partner, while one in four transactions had at least one participant
from the Asia-Pacific region.
-- Big Pharma was the biggest driver of biopartnering activity, having a
role in almost half the deals for which financial terms were shared. The
most active large pharma company was Merck & Co. (also known as Merck
Sharp & Dohme or MSD), participating in 15 such partnering deals in
2022.(3)
-- Among pharma there is significant debate about the potential impact
artificial intelligence and machine learning (AI/ML) may have in
improving the economics of research and development. One of the most
active pharma companies in 2022 partnering with AI/ML companies was
Sanofi, which has established marquee relationships with AI/ML companies
- inking three of the four most valued deals in 2022.(4)
-- Cell therapy platforms maintain their allure for pharma, with companies
such as Roche securing a research collaboration with Poseida
Therapeutics to develop off-the-shelf, or allogeneic, CAR-T cell
therapies to address medical needs for patients with certain blood
cancers.(5)
-- With the mRNA COVID-19 vaccines demonstrating proof of concept for the
technology, pharma is keen to access next generation RNA platforms that
can overcome some of mRNA's limitations. One of the most promising
platforms is the use of self-amplifying RNAs derived from the genomes of
positive-strand RNA viruses. In 2022, the most valuable RNA platform
partnership saw CSL-Sequirus pay Arcturus $200 million up front and
offer more than $4 billion in potential development and commercial
milestones for influenza, pandemic preparedness and three additional
respiratory infectious disease vaccines.(6)
Mike Ward, Global Head of Life Sciences and Healthcare Thought Leadership, Clarivate, said: "The rapid devaluation of biotechs has brought about a role reversal in which biotechs, recently flush with capital, are looking at some lean years while pharmas hold all the leverage in the relationship. However, the fundamental dynamic underpinning these companies remains: they need each other in order to keep pipelines producing innovative medicines. The in-depth analysis of how pharma companies are replenishing their pipelines featured in the Biopharma Deals Report provides our customers with the answers they need to shape the future of healthcare."
Read the report, Biopharma Dealmaking in 2023, here.
Clarivate draws on deep industry expertise and industry standard data to help life science partners identify market opportunities, anticipate barriers in order to deliver innovative treatments to patients and create a healthier tomorrow. To learn more, please visit www.clarivate.com.
About Clarivate
Clarivate is a leading global information services provider. We connect people and organizations to intelligence they can trust to transform their perspective, their work and our world. Our subscription and technology-based solutions are coupled with deep domain expertise and cover the areas of Academia & Government, Life Sciences & Healthcare and Intellectual Property. For more information, please visit clarivate.com.
(1) BioWorld, 2023. Biopharma financings stall in 2022. [Online] Available at: https://www.bioworld.com/articles/693196-biopharma-financings-stall-in-2022-four-other-years-higher-than-608b-raised [Accessed 10 May 2023].
(2) Clarivate, 2023. Top 100 Global Innovators 202. [Online] Available at: https://clarivate.com/top-100-innovators/ [Accessed 10 May 2023].
(3) BioWorld, 2022. The year's biggest deal: Merck and Kelun enter $9.3B alliance. [Online]
Available at: https://www.bioworld.com/articles/692734-the-years-biggest-deal-merck-and-kelun-enter-93b-alliance [Accessed 10 May 2023].
(4) BioWorld, 2022. Exscientia lands $5.3B deal expansion with Sanofi. [Online] Available at: https://www.bioworld.com/articles/514891-exscientia-lands-53b-deal-expansion-with-sanofi [Accessed 10 May 2023].
(5) BioWorld, 2022. Poseida's $6B blood relationship with Roche akin to Takeda deal in concept, strategy: CEO. [Online]
Available at: https://www.bioworld.com/articles/521452-poseidas-6b-blood-relationship-with-roche-akin-to-takeda-deal-in-concept-strategy-ceo [Accessed 10 May 2023].
(6) BioWorld, 2022. CSL Seqirus in-licenses Arcturus mRNA vaccine platform technology in potentially high-value deal. [Online] Available at: https://www.bioworld.com/articles/691221-csl-seqirus-in-licenses-arcturus-mrna-vaccine-platform-technology-in-potentially-high-value-deal [Accessed 10 May 2023].
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SOURCE Clarivate Plc
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