Biotech’s overheated asset prices finally came home to roost. The NASDAQ Biotech Index’s multi-year ascent turning into a descent from February. But the hangover didn’t transfer to initial public offerings (IPOs), with the year witnessing three of the largest ever: SK Bioscience, SD Biosensor and Sana Biotechnology. South Korean companies were prominent in raising eye-popping amounts, and five of the top ten flotations were on Asian exchanges. Follow-on financings were less buoyant, down 34% from the previous year (notwithstanding BeiGene’s $3.5 billion haul, the second largest on record). US and European venture capital (VC) funds had a good year, spurring healthy company formation. ElevateBio, Centessa Pharmaceuticals and Atai Life Sciences signaled the rise of a new type of company: umbrella corporations containing multiple asset-centric ventures. In addition to enterprises developing RNA medicines, developers of adoptive immune cell therapies (Century Therapeutics, CARsgen Therapeutics, Lyell Immunopharma, Sonoma Biotherapeutics and Wugen) and PROTAC (proteolysis-targeting chimera) approaches (Imago Biosciences, Arvinas and Foghorn Therapeutics) were prominent in fundraising and partnering. Financing also rolled in to machine learning ventures, whether from the public markets (Recursion, Insilico Medicine and Exscientia) or from risk capital (EQRx, Insitro, XtalPi and Generate Biomedicines). Mergers were down, as pharma showed a greater interest in partnerships in the face of bloated biotech assets.
Stock market performance
After hitting February’s all-time high, the NASDAQ Biotech Index slid 37%, whereas the NASDAQ rose 18% to new highs.
Global biotech initial public offerings
The IPO gravy train rolled on in all regions.
Number of IPOs
2017 | 2018 | 2019 | 2020 | 2021 | |
|---|---|---|---|---|---|
Asia-Pacific | 13 | 25 | 40 | 44 | 44 |
Europe | 26 | 15 | 8 | 14 | 30 |
Americas | 33 | 56 | 47 | 75 | 90 |
Global biotech financing
Across the board, financing was steady, although debt in particular was lower than the same time last year.
Global biotech venture capital investment
Venture funding trended up in the Americas and Europe, with Asia-Pacific lower than in 2020.
Number of rounds
2017 | 2018 | 2019 | 2020 | 2021 | |
|---|---|---|---|---|---|
Asia-Pacific | 79 | 96 | 100 | 120 | 70 |
Europe | 163 | 153 | 162 | 184 | 146 |
Americas | 437 | 431 | 373 | 413 | 399 |
Top IPOs of 2021
Company (principal underwriters) | Amount raised ($ millions) | Date completed | Latest stage and focus | Percent change in stock price (as of 1/7/2022) | Exchange |
|---|---|---|---|---|---|
SK Bioscience (NH Investment & Securities) | 1,313 | 18 March | Marketed; vaccines produced in cell culture, protein conjugates, antigen protein design, gene synthesis and cloning, vector manufacturing and protein purification | +18.32% | Korea |
SD Biosensor (Korea Investment & Securities) | 677 | 16 July | Marketed; in vitro diagnostics, including nucleic acid amplification and rapid antigen tests, ELISAs and fluorescence immunoassays for infectious and chronic diseases | –7.21% | Korea |
Sana Biotechnology (Morgan Stanley, Goldman Sachs, J.P. Morgan, BofA Securities) | 677 | 3 February | Preclinical; ‘universal’ induced pluripotent stem cells engineered to overexpress ‘do-not-eat-me’ CD47, PD-L1 and human leukocyte antigen G and containing deletions to genes encoding components of the MHC; ‘fusogen’ viral particles incorporated into a lipid bilayer for gene delivery to hematopoietic stem cells | –63.45% | NASDAQ |
Zymergen (J.P. Morgan, Goldman Sachs, BofA Securities, Cowen, UBS Investment Bank, Lazard) | 575 | 21 April | Marketed; engineered microbes for use across multiple sectors using robotics and ML to automate and scale identification of preferential traits for chemicals and biomaterials | –84.86% | NASDAQ |
Recursion (Goldman Sachs, J.P. Morgan, BofA Securities, SVB Leerink, Allen & Co., KeyBanc Capital Markets) | 502 | 16 April | Phase 1; iterative ML-guided drug candidate screening using images from high-throughput cellular assays | –47.28% | NASDAQ |
Keymed Biosciences (Morgan Stanley, CICC, Huatai Securities, China Everbright) | 460 | 7 July | Phase 2; bispecific antibodies and antibody–drug conjugates, autoimmune and cancer therapies | –57.5% | Hong Kong |
Lyell Immunopharma (Goldman Sachs, BofA Securities, J.P. Morgan, Morgan Stanley) | 425 | 16 June | Preclinical; genetic and epigenetic T cell reprogramming to develop CAR and TCR autologous T cells engineered with ‘exhaustion resistance’ | –61.81% | NASDAQ |
Prestige BioPharma (Samsung Securities) | 405 | 5 February | Registration; humanized antibodies, biosimilars and adenovirus-based vaccines | –60.3% | Korea |
CARsgen Therapeutics (Goldman Sachs, UBS, Citic Securities, Credit Suisse) | 400 | 17 June | Phase 2/3; cytokine- and chemokine-loaded autologous CAR-T cells for solid tumors | –19.83% | Hong Kong |
Centessa Pharmaceuticals (Morgan Stanley, Goldman Sachs, Jefferies, Evercore) | 380 | 27 May | Phase 3; umbrella organization for 10+ asset-centric companies | –58.67% | NASDAQ |
Top venture financings of 2021
Company (lead investors) | Amount raised ($ millions) | Round | Date completed | Location | Focus |
|---|---|---|---|---|---|
Suzhou Abogen Biosciences (Temasek, Invesco, Loyal Valley Capital and others) | 700 | C | 19 August | China | mRNA vaccines |
ElevateBio (Matrix Capital Management, EDBI, Emerson Collective and others) | 525 | C | 15 March | United States | Gene therapy accelerator for portfolio of asset-centric cell and gene therapy companies; vector manufacturing services |
EQRx (Arch Venture Partners, Andreessen Horowitz, GV and others) | 500 | B | 11 January | United States | In-licensed and in-house discovery incorporating ML in analyzing screen hits for drugs against validated targets in oncology and immune inflammatory diseases |
Laronde (Flagship Pioneering, T. Rowe Price, Invus and others) | 440 | B | 30 August | United States | Circular RNA for therapeutic protein expression |
Insitro (CPP Investment Board, Andreessen Horowitz, SoftBank Vision Fund and others) | 440 | C | 15 March | United States | ‘Active’ ML analysis of image and multiomics data from screens of human induced pluripotent stem cells CRISPR-engineered for lead generation |
XtalPi (OrbiMed Advisors, RRJ Capital, Hopu Investment Management and others) | 400 | D | 11 August | United States | ML and computational chemistry in small-molecule discovery |
Generate Biomedicines (Flagship Pioneering, Abu Dhabi Investment Authority, Alaska Permanent Fund and others) | 370 | B | 11 November | United States | ML and computational biology to identify de novo target-binding sequences in antibody and protein therapeutics using three-dimensional structural information for oncology, immune inflammatory and infectious diseases |
Adagio Therapeutics (RA Capital Management, Redmile Group, Federated Hermes and others | 336 | C | 19 April | United States | Adimab spinout developing broadly neutralizing mAbs for SARS-CoV-2 variants and zoonotic sarbecoviruses |
Cardurion Pharmaceuticals (Bain Capital Life Sciences, Bain Capital Private Equity) | 304 | Not disclosed | 27 October | United States | Takeda spinout developing small-molecule inhibitors of phosphodiesterase 9 and CAMK2 to treat heart failure and rare arrhythmias, respectively |
Freenome (Perceptive Advisors, RA Capital Management, a16z Life Sciences Growth Fund and others) | 300 | D | 7 December | United States | Multiomics platform for early colon cancer detection via liquid biopsy |
Mergers and acquisitions
Target | Acquirer | Deal focus | Value ($ millions) | Date announced |
|---|---|---|---|---|
Grail | Illumina | Liquid biopsy screening to detect tumor in blood for early-stage cancer | 3,500 | 18 August |
Dicerna Pharmaceuticals | Novo Nordisk | Dicer substrate small interfering RNAs (DsiRNAs) for intracellular targets in hepatic and extrahepatic cell types and tissues | 3,300 | 18 November |
Five Prime Therapeutics | Amgen | Immuno-oncology and targeted cancer therapies, including bemarituzumab (recombinant glycoengineered, afucosylated humanized IgG1 mAb targeting FGFR2b), which has completed a phase 2 trial in gastric cancer | 1,900 | 4 March |
Kadmon | Sanofi | First-in-class treatment for graft-versus-host disease Rezurock (belumosudil; small-molecule inhibitor of ROCK2) | 1,900 | 8 September |
GenMark Diagnostics | Roche | Multiplex molecular diagnostic panels to detect several respiratory pathogens, including SARS-CoV-2, from a single patient blood sample | 1,800 | 15 March |
Vividion Therapeutics | Bayer | Covalent small-molecule discovery and development using chemoproteomic screens that identify cryptic binding pockets in drug targets | 1,500 | 5 August |
Kymab | Sanofi | Amlitelimab, a fully human IgG4κ mAb that binds to OX40 ligand | 1,100 | 11 January |
Amunix | Sanofi | Unstructured hydrophilic 864-amino acid polypeptide (XTEN) for conjugation to T cell engager mAbs or cytokines to create prodrugs capable of local activation by tumor proteases | 1,000 | 20 December |
Top licensing and collaborations of 2021
Researcher | Partner | Up-front cash ($ millions) | Description |
|---|---|---|---|
Alector | GlaxoSmithKline | 700 | Global collaboration in immuno-neurology for two clinical-stage first-in-class human IgG1 mAbs targeting sortilin 1 in neurodegenerative disease |
BeiGene | Novartis | 650, 300 | BeiGene grants Novartis rights to develop and commercialize tislelizumab, a humanized anti-PD-1 IgG4 mAb in North America, Europe and Japan |
Eisai | Bristol Myers Squibb | 650 | Global strategic collaboration for Eisai’s MORAb-202, antibody–drug conjugate comprising farletuzumab (a humanized IgG1 mAb targeting folate receptor-α) and the microtubule-targeting agent eribulin |
Arvinas | Pfizer | 650 | Co-development and commercialization of ARV-471, a small-molecule PROTAC estrogen receptor degrader |
iTeos Therapeutics | GlaxoSmithKline | 625 | Collaboration to develop and commercialize EOS-448, an anti-TIGIT human IgG1 mAb for treating solid tumors |
Foghorn | Lilly | 300 | Strategic collaboration for novel oncology targets using Foghorn’s platform for identifying small-molecule PROTAC degraders that target chromatin remodeling complexes |
Debiopharm | Merck | 221 | Debiopharm grants Merck exclusive, worldwide rights to develop and commercialize xevinapant, an oral small-molecule antagonist of IAPs in cancer |
Agenus | Bristol Meyer Squibb | 200 | Exclusive global license for Agenus’s anti-TIGIT program using fully human bispecific antibodies with Fc engineered for high affinity to Fcγ receptor I |
Ionis Pharmaceuticals | AstraZeneca | 200 | Co-development and commercialization of eplontersen, a ligand-conjugated antisense oligonucleotide designed to reduce the production of transthyretin protein |
RemeGen | Seagen | 200 | Exclusive worldwide license and co-development agreement for disitamab vedotin, an antibody–drug conjugate comprising a monoclonal antibody against HER2 conjugated via a cleavable linker to the cytotoxic agent monomethyl auristatin E. |
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DeFrancesco, L. 2021 — the bubble’s hangover. Nat Biotechnol 40, 151–153 (2022). https://doi.org/10.1038/s41587-022-01215-3
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DOI: https://doi.org/10.1038/s41587-022-01215-3
