Biotech's revenue and R&D spending growth was slower in 2012 than in 2011, shows an Ernst & Young report.

The lowdown: Ernst & Young analysts reviewed the data from 598 public biotech companies in their 27th annual Beyond Borders report on the health of the biotechnology sector, and came up with mixed results (go.nature.com/5igfsV). Although research and development (R&D) expenses — a bellwethers of the state of the industry — were up 5% (to $25.3 billion), this growth rate was down from the 9% increase achieved in 2011. “The distribution of these expenditures was more worrying than the totals. Across these major markets, R&D spending by commercial leaders remained strong, while smaller, pre-commercial entities substantially reduced the pace of growth,” wrote Ernst & Young's Glen Giovannetti and Gautum Jaggi. In the United States, for example, commercial leaders increased their R&D spending by 18%, whereas other companies decreased spending by 5%.

Revenue similarly was up 8% in 2012 (to $89.8 billion), but this growth was slower than the 10% achieved in 2011. On the financing side, the vast majority of small venture-backed firms still have access to only pre-financial crisis levels of capital, a phenomenon the authors dubbed “the new normal” in 2012.

“While biotech's financial metrics continue to be healthier than they were in the immediate aftermath of the crisis, the sector is not completely out of the woods,” they write.