The UK biotech industry has enjoyed a boom during the pandemic raising a record £1bn in the third quarter alone.
Latest figures from the Bioindustry Association and Clarivate representing the UK’s biotech and life sciences sector show the scale of fundraising accelerated between June and August.
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While companies involved in developing vaccines or treatments have received most attention, the biotech industry has raised £1.9bn to date this year, with 2020 on target to be the best year on record.
Between June and August alone, UK biotech firms raised more than £1bn, the highest quarter for investments in the sector on record.
Public markets continue to be the main driver of this performance. Freeline Therapeutics, a clinical-stage gene therapy company founded by UCL Business and Syncona topped investments with a £119m straight-to-Nasdaq IPO, showing continued appetite for UK biotechs in the US.
Prior to its listing, the company extended its series C round which closed at $120m with an additional $80m secured in a deal in June.
And after an initial lull at the start of the pandemic, seed and early stage venture capital deals returned to pre-Covid levels with £282m raised in the quarter. Bit Bio, a spinout from Cambridge University working on gene therapy, raised £32m in a series A deal in June.
As in the second quarter, public follow-on financings enjoyed a strong third quarter with a record £601m raised across all markets, with high levels of activity most notable in the US.
Adaptimmune Therapeutics raised £168m on Nasdaq while Verona Pharma, which is dual-listed on Aim and Nasdaq, raised £160m in a private placing from Novo Holdings and 22 other investors.
The strong investment landscape has been matched by rising share prices as new investors enter the sector. The long term returns of biotech have outperformed other sectors including pharmaceuticals and tech, in both venture capital and public markets.
Steve Bates OBE, chief executive of the BIA said: “During the pandemic, UK biotech has shown its strategic value and received great interest from UK based investors, with many investing in the sector for the first time.”
“This could be transformative for patients and the economy, and for shareholders, when combined with the global money we already attract – large pharma, US and Chinese venture capitalists are already aware of the vast opportunities UK biotech presents.”