GW Pharma and Orchard Biggest UK Biotech Fundraisers In Q1

A new BIA/Informa Biotech Financing Update covering the December 2017 to February 2018 period looks at all the funding routes for the sector, and the biotech sector association says the first few months bode well for the year.

The UK has a range of promising and innovative biotech firms, with which will require plentiful cash as they gear up for pivotal trials, regulatory filing and launches in the next few years.

Venture capital funding and follow-on financing via public offerings both showed strong figures during the period, but the IPO market was once again quiet.

There were no IPOs from the sector in the early months of this year, a trend in line with 2017, where there was just one launch in the first half of the year.

The BIA and Informa say the lack of IPO activity reflects the global trend, with just 12 biotech market launches worldwide, and just two in Europe. These were Germany’s dermatology specialists BioFrontera, which raised $16m ADS on the Nasdaq in February and rare disease focused Advicenne, which raised €27m on EuroNext Paris in December).

UK venture capital funding for biotech was much more robust, however. This totalled £134.9 million for the period, and was dominated by London-headquartered gene therapy specialists Orchard Therapeutics.

It raised £85m via a B round fundraising in December, which will help fuel development of its pipeline, led by OTL-101 a treatment for a rare life-threatening immunodeficiency disorder called (ADA-SCID).

OTL-101 gained a coveted FDA Breakthrough Therapy Designation in July last year, putting it among a group of promising technologies in the fast-growing cell and gene therapy market.

In the same month, Biosceptre International raised £8m in a Round A funding for its novel pipeline of antibody-based therapeutics and vaccines.

This was followed in January by Vaccitech, which raised £20 million from a group of investors including Google for its novel flu and therapeutic vaccines platform.

Meanwhile Juvenescence, a new company focused on drug development and artificial intelligence for ageing and age-related diseases, raised £8.9 m in seed funding.

The majority of the secondary financings total for 2018 to date was made up by the impressive GW Pharma follow-on public offering on Nasdaq for £221.6m.

Three UK companies used another approach, debt financing as a source of fundraising this year. These were: Mereo BioPharma, Midatech Pharma and Sinclair Pharma. The BIA and Informa say this represents around a quarter of the total used last year but the company count is already more than half.

This could become a more popular route for UK companies to raise finance, and the BIA says it will monitor the trend over 2018.

The only UK biotech IPO we saw in the first half of 2017 was SkinBio Therapeutics, which generated £4.5m for the company. The BIA says there are already possible public financings in the pipeline for March and April, which could see 2018 at least match last year’s performance.

“It’s great to see UK biotech companies starting the year with some strong fundraisings, including some great outcomes for BIA member companies such as Orchard Therapeutics and GW Pharm,” said BIA chief executive Steve Bates.

We look forward to tracking the trends for UK biotech financing throughout these quarterly updates in 2018.”

While the UK sector looks to be in good health, the US biotech market is once again demonstrating why it is the global powerhouse.