Biotech investment slumps in 2022, but UK innovation remains ‘magnet for global pharma’

31 January 2023 | Muriel Cozier

‘We expected a fall in investment following two bumper years, but it should still be considered a warning.’

According to a report from the UK BioIndustry Association (BIA), the UK biotech sector saw a drop-off in investment during 2022 compared with 2021. The UK biotech financing 2022 report, produced by the BIA and Clarivate, indicates that during 2022, £1.8 billion was raised by UK biotech companies, compared with the £4.5 billion raised in 2021.

At the same time, the report highlights that UK innovation remained a magnet for global pharma companies, which looked to the UK to strengthen their product pipelines. A number of UK biotech companies were ‘acquired at a premium’, the report says. These acquisitions included Pfizer paying an estimated £420 million for ReViral, and AbbVie buying DJS Antibodies for £229 million.

Dan Mahony, the UK government’s Life Sciences Investment Envoy comments in the report: ‘We have many of the elements required to deliver on the government’s commitment to make the UK a life sciences superpower […] The missing piece is the supply of capital from our own domestic financial institutions driven by the confidence to invest in an industry where the UK has the potential to create a sustainable comparative advantage.’

Steve Bates OBE, CEO of the BIA added, ‘We expected a fall in investment following two bumper years, but it should still be considered a warning. There is global capital out there for us to attract, as well as finance in the City of London we need to unlock, but competition is fierce.’

The report also highlighted some new developments. ‘We are also seeing new forms of companies that are adding to the already very attractive UK offer. We have dubbed this emerging subsector techbio, to reflect its place at the intersection of the artificial intelligence and digital revolution and the UK’s existing and formidable drug discovery capability,’ the report said.

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