Biotech and pharma deals in 2020 soared to an all-time high of 1,154 signed deals with $146.3 billion in total value, defying expectations that the global Covid-19 pandemic would hamper dealmaking. Global healthcare and life sciences R&D partnership activity was up 23 percent over 2019 and total deal values rose 31 percent from the previous year, driven in part by advances in technological and molecular understandings of disease pathways, and a drive toward targeted precision medicines.
We tapped the DealForma database to look at biopharma partnering activity in 2020 in more detail.
The Takeaways – Biopharma Deals in 2020:
- Big Pharma and Big Biotech continued to dominate the top dealmakers lists, but several mid-stage players joined the top 20 lists, including Incyte, CSL Behring, and Daiichi Sankyo for total upfront payouts, Neurocrine for total value, and Sarepta for total number of deals.
- Total upfront cash & equity was up 16.8 percent, but average upfront cash and equity fell slightly, down 3 percent compared to 2019.
- With 276 R&D partnerships focused on Covid-19, the number of infectious disease partnerships skyrocketed 572 percent over 2019, but total values of these deals fell 40 percent, even as the total paid in upfront cash and equity soared 130 percent compared to 2019.
- Biopharma mergers and acquisitions were active as well. Check out our analysis of 2020 biotech and pharma M&A here.
Biotech and Pharma Deal Terms
Biopharma R&D partnering median upfront cash and equity paid at signing soared 50 percent in 2020 compared to 2019, but average deal values dropped 3 percent during the same period.
Deals Go Earlier and Larger
Total upfront cash and equity, at $17.4 billion, rose 17 percent for biotech and pharma deals in 2020 compared to 2019. While this looks good on the surface, the money paid at signing accounted for only 11.9 percent of total potential deal values in 2020, compared to 13.4 percent of total potential deal values in 2019. So, while the numbers and potential values were strong, deals were more back-loaded with total potential deal values contingent on the achievement of milestones as licensees made riskier bets on novel platforms where they have more say on targets of interest, and early stage assets where the licensees have more control on development.
It is interesting to note that median upfront cash and equity for platform deals jumped 95 percent in 2020 compared to 2019, while it fell 33 percent for preclinical assets. Mid- and late-stage assets also commanded a premium with median upfront cash and equity up 50 percent for mid-stage asset and late-stage deals, compared to 2019.
Cancer Remains Leading Deal Target
Biotech and pharma deals in 2020 saw 379 partnerships for cancer as the top therapeutic target for dealmaking, accounting for 38.9 percent of all deals, 55 percent of total deal values, and 57.1 percent of total upfront cash and equity. We have covered this before in detail, and DealForma database users can quickly grab the latest numbers.
Neurology / CNS Deals
Indeed, 8 out of the top 12 deals in 2020 by total deal value focused on cancer as the primary therapeutic area, while 3 focused on neurologic conditions, a fast growing area of unmet need. Total deal values of neurologic partnerships made up 18.7 percent of total deal values in 2020, up 119 percent compared to 2019, with total upfront cash and equity also up 147 percent compared to 2019, in an area that has had its share of failures but that is beginning to hold promise for success with recent advances in technological innovation.
Top Biopharma Deals in 2020 by Upfront Cash & Equity
Want data for your analysis? Want us to do it? Subscribers get both.
Schedule your demo of the DealForma database to see how we help you get better reports done faster.
Specifically for Biotech, Pharma, Device, and Diagnostics
There’s every reason to think 2021 will match 2020 numbers for biopharma R&D dealmaking. A strong pace in the first half of the first quarter of 2021 has seen 132 announced collaborations with total deal values of $18.8 billion. The success of virtual partnering last year will only accelerate opportunities to partner in the years ahead with a new crop of recently launched companies in with exciting new technologies and promises of tackling once intractable diseases.
This article is a sample from the DealForma Quarterly Deal Trends Report provided to database customers. Data for this analysis was compiled using the DealForma biopharma deals database. We applied initial filters for partnerships and deal subtypes, therapeutic areas, modalities, asset stages at signing, and deal payment terms. From there, we exported the data to Excel and used pivot tables and charts to do the rest. All data are based on publicly disclosed figures. We invite you to answer interesting questions on biopharma business development and licensing using our data and carefully curated profiles on deals, pipelines, companies, funding, and business executives by visiting dealforma.com to schedule your personalized demo.
Marie Daghlian is a freelance writer and editor who reports on the business of biotechnology and healthcare technologies and on rare diseases for Global Gene’s Rare Daily. She also covers the industry for Big4Bio, a daily newsletter focused on the four major biotech centers in the United States.
More Research by DealForma
November 2021 Top Biopharma Deal: Sanofi – Owkin artificial intelligence and federated learning platform to advance Sanofi’s oncology pipeline
The top deal upfront for November 2021 was the Owkin – Sanofi artificial intelligence and federated learning platform research partnership to advance Sanofi’s oncology pipeline. Owkin will receive a $180M upfront equity investment, $90M in R&D funding over 3 years, and is eligible for additional undisclosed R&D milestones.
The top deal upfront for October 2021 was the Xencor – Janssen deal for plamotamab and XmAb bispecific antibodies and new XmAb B-cell targeting bispecific antibodies for CD20-expressing hematologic malignancies. Xencor will receive $100M in upfront cash, $25M in an upfront equity investment, and is eligible for up to $1.18B in dev., reg., and sales milestones, plus tiered mid-teens to low-twenties royalties.
The top deal upfront for September 2021 was the REGENXBIO – AbbVie deal for RGX-314 for wet AMD, diabetic retinopathy, and other chronic retinal diseases. REGENXBIO will receive $370M up front and is eligible for up to $1.38B in milestones, plus tiered royalties on net sales of RGX-314 outside the US and 50% of profits in the US.
August 2021 Top Biopharma Deal: RemeGen – Seagen HER2-targeted ADC, Disitamab Vedotin for Solid Tumors
The top deal upfront for August 2021 was the RemeGen – Seagen deal for HER2-targeted ADC disitamab vedotin for solid tumors. RemeGen will receive $200M in cash up front and is eligible to receive up to $2.4 billion in milestones, plus tiered, high single-digit to mid-teen royalties.
Top Biopharma Deal July 2021: Arvinas – Pfizer ARV-471 PROTAC Protein Degrader for ER+/HER2- Breast Cancer
The top biopharma deal upfront for July 2021 was Arvinas and Pfizer’s partnership for PROTAC protein degrader ARV-471 ER+/HER2- breast cancer. Arvinas will receive $650M in cash up front, $350M in an equity investment, and is eligible to receive up to $1.4 billion in milestones, plus a 50% cost and profit split.
The top biopharma deal upfront for June 2021 was iTeos and GSK’s partnership for anti-TIGIT mAb EOS-448. iTeos will receive $625M up front, up to $1.45B in milestones, a U.S. profit split and ex-U.S. tiered royalties.
Top Biopharma Deal May 2021: Agenus – BMS for AGEN-1777 Bispecific Anti-TIGIT Antibody for Non-Small Cell Lung Cancer
The top biopharma deal upfront for May 2021 was Agenus and BMS’ partnership for anti-TIGIT mAb AGEN-1777. Agenus will receive $200M up front.
Top Biopharma Deal April 2021: CRISPR – Vertex for CTX001 for Sickle Cell Disease and Transfusion-Dependent Beta-Thalassemia
CRISPR Therapeutics and Vertex Pharmaceuticals amended their 2015 deal to develop and commercialize gene editing therapies. This expansion is for Phase I/II CTX001 for severe sickle cell diseases and transfusion-dependent beta-thalassemia. CRISPR will receive $900M up front, up to $200M in milestones upon the first regulatory approval, and a cost/profit split of 40%.
Debiopharm granted Merck exclusive, worldwide rights to develop and commercialize Xevinapant in Phase III for advanced squamous cell carcinoma of the head and neck. Debiopharm will receive EUR188M ($227M) up front and is eligible for up to EUR710M ($856M) in milestones, plus royalties. This was the largest upfront cash and equity for a partnership signed in March 2021.
Vir Biotechnology and GSK expanded their partnership with a new deal to develop VIR-2482 and mAbs for influenza. This was the largest upfront cash and equity for a partnership signed in Feb. 2021.
You met on Zoom. Now it's Deal Time.
With thousands of company profiles and a decade of deals specifically in biopharma and medtech, you'll take the guesswork out of deal comps. Schedule your customized demo to see how DealForma helps you win that term sheet with better data.