Data for the this analysis was compiled using the DealForma database; specifically the companies and venture funding sections. We used company location data tagged with the three major U.S. biotech hubs along with primary therapeutic and technology focus areas. All data are based on publicly disclosed figures. We invite you to answer interesting questions using our data and carefully curated profiles on deals, pipelines, companies, funding, and business executives by visiting dealforma.com to schedule your personalized demo.
Location, Location, Location: Real estate costs a lot in the three largest biotech hubs, but it’s a charm for raising capital. Biotech companies raised $37.4 billion globally in 1027 rounds of venture financing over the past four years from 2015 through the third quarter of 2018 and companies located in the San Francisco Bay area, greater Boston area, and San Diego County accounted for 55 percent of the total raised and 46 percent of the financing activity. The data comes from DealForma’s extensive database and research capabilities.
Analysis of this data shows that the San Francisco Bay Area has maintained a slight edge over the burgeoning Boston/Cambridge scene in terms of dollars raised and rounds completed by private biotech companies. And venture investment into San Diego-based companies has boomed in 2018 to $938 million raised in 14 rounds, compared to just $100 million raised in five rounds in 2017.
Cancer continues to be the top therapeutic area of interest for VC investment especially for the SF Bay Area, garnering 38 percent of dollars invested. But in the Boston area, technology platform companies garnered slightly more money, $2.6 billion versus $2.2 billion, in three fewer investment rounds. And in San Diego, investment in technology platform companies outpaced investment in cancer therapeutics over the past four years.
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Specifically for Biotech, Pharma, Device, and Diagnostics
Technologies for the development of small molecule therapeutics garnered top dollars across all three regions with immunotherapies, cell and gene therapies, and diagnostics investment trailing close behind. Indeed advancement in these technologies is at an all-time high as the number of companies that raise $100 million or more per round continues to grow. Among the global $100 million plus group, biotech companies raised a total of $10.3 billion over the past four years in 61 investment rounds, averaging $169 million per round. Biotechs in the three big hubs accounted about half of that, or $5.8 billion of that in 33 rounds, averaging $176 per round.
Historically, investors usually waited until a company had surpassed an inflection point before placing a lot of dollars into it. Recently, however, an increasing number of Series A and Series B rounds are $100 million plus. During the first three quarters of 2018, $ 1 billion was invested in Series A and Series B rounds in biotechs based in the three major hubs in six rounds, out of $2.2 billion invested globally in early stage companies in 13 rounds.
This is the result of a number of factors, including robust fundraising by VCs who must now invest those funds, excitement about new technologies and advances in biological and technological understanding, a responsive regulatory environment, and strong capital markets with an open IPO window and healthcare savvy investors.
Next week, I’ll talk about some of the top VCs in biotech and companies they are investing in.
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.
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The top deal upfront for Nov 2022 was the POINT – Lantheus exclusive, worldwide ex-Asia license to co-develop and commercialize POINT’s PNT2002, a PSMA-targeted 177 Lu-based radiopharmaceutical therapy, and PNT2003, a somatostatin receptor (SSTR) targeted radioligand therapy by combining POINT’s radioligand development expertise with Lantheus’ commercial expertise in PSMA PET and radiopharmaceuticals for the treatment of metastatic castration-resistant prostate cancer (mCRPC) and gastroenteropancreatic neuroendocrine tumors (GEP-NETs). Additionally, POINT will be responsible for the funding, development, and manufacturing of PNT2002 and PNT2003 while Lantheus will be responsible for NDA approval and development and commercial expenses. POINT will receive $250M (for PNT2002)and $10M (for PNT2003) up front and is eligible for up to $281M and $34.5M in development milestones and up to $1.28B and $275M in commercial milestones, plus 20% and 15% royalties for PNT2002 and PNT2003, respectively.
The top deal upfront for Oct 2022 was the MacroGenics research partnership with Gilead with an option to license MGD024. MacroGenics signed a research partnership with Gilead to develop MGD024, a bispecific antibody, and two additional bispecific therapies using MacroGenics’ DART platform with an exclusive, worldwide option to license MGD024 for the treatment of certain blood cancers, including acute myeloid leukemia (AML) and myelodysplastic syndromes (MDS). MacroGenics will be responsible for Phase I clinical trials of MGD024 as a monotherapy and combination therapy for multiple indications. Gilead may exercise its option at predetermined decision points. MacroGenics will receive $60M in cash up front and is eligible for up to $1.7B in development, regulatory, and commercial milestones, and undusclosed option exercise fees, plus tiered, double-digit royalties for MGD024 and a flat royalty for two other therapies.
The top deal upfront for Sep 2022 was the SpringWorks expanded clinical collaboration with GSK for Nirogacestat in combination with GSK’s Blenrep. SpringWorks granted GSK non-exclusive rights to develop and commericalize Nirogacetat,an oral gamma-secretase inhibitor, in combination with GSK’s Blenrep, an antibody-drug conjugate targeting B-cell maturation antigen for the treatment of multiple myeloma. SpringWorks will receive a $75M equity investment in shares of common stock at a premium to the 30-day volume-weighted average share price on Sept 2, 2022, and is eligible to receive up to $550M in development and commercial milestones.
The top deal upfront for Aug 2022 was the Sanofi development and commercialization deal with Innovent for SAR408701 and SAR444245. Sanofi granted Innovent exclusive rights to develop and commercialize its SAR408701 (tusamitamab ravtansine) for the treatment of non-small cell lung cancer (NSCLC) and gastric cancer in China. Additionally, Sanofi and Innovent will co-develop SAR444245 for the treatment of multiple cancer drugs. Sanofi will invest EUR300M (approx. $306.6M) in Innovent up front at HK$42.42 (approx. $5.40) per share in Innovent common stock. Sanofi is eligible for EUR80M (approx. $81.7M) in development milestones plus royalties for SAR408701, while Innovent is eligible to receive EUR60M (approx. $61.3M) in development milestones and royalties for SAR444245.
The top deal upfront for July 2022 was the Orion co-development and co-commercialization deal with MSD for ODM-208. Orion granted MSD rights to co-develop and co-commercialize ODM-208 for the treatment of metastatic castration-resistant prostate cancer. Orion and MSD have an option to convert the co-development and co-commercialization agreement into a global exclusive license to MSD. Upon exercising the option, MSD will retain the responsibility for all accrued and future development and commercialization expenses associated with the program. Orion will receive $290M up front, including $221M recognized as income, and approximately $60.3M reserved to cover Orion’s share of ODM-208 future development cost. Orion is eligible for undisclosed development and commercialization milestones, plus double-digit tiered royalties.
June 2022 Top Biopharma Deal: Sanofi – Regeneron Pharmaceuticals for Cancer/Inflammation drug Libayo
The top deal upfront for June 2022 was the Sanofi development and commercialization deal with Regeneron for Libtayo (Amended Agreement). Sanofi granted Regeneron exclusive, worldwide rights to develop and commercialize Libtayo for the treatment of cancer. Regeneron and Sanofi signed a license agreement in 2015 to develop Libtayo. Sanofi will receive $900M up front and is eligible to receive up to a $100M milestone upon the first approval by either the FDA or EMA for Libtayo in combination with chemotherapy for first-line treatment of certain patients with NSCLC and up to $100M as a sales milestone in the next two years, plus 11% royalties.
May 2022 Top Biopharma Deal: Dragonfly Therapeutics – Gilead Sciences NK cell engager for cancer/inflammation
The top deal upfront for May 2022 was the Dragonfly Therapeutics development and commercialization deal with Gilead Sciences for solid tumors. Gilead has an exclusive, worldwide option to develop and commercialize additional NK cell engager programs by using its Tri-specific NK Engager (TriNKET) platform after the completion of certain preclinical activities. Dragonfly will receive $300M up front and is eligible to receive undisclosed opt-in payments and development, regulatory, and commercial milestones, plus up to 20% royalties.
April 2022 Top Biopharma Deal: Harbour BioMed – AstraZeneca Bispecific Antibody for Cancer Treatment
The top deal upfront for April 2022 was the Harbour BioMed development and commercialization deal with AstraZeneca for solid tumors. AstraZeneca will be responsible for all costs for development and commercialization. HBM will receive $25M up front and is eligible for up to $325M in development, regulatory, and commercial milestones, plus undisclosed tiered royalties.
March 2022 Top Biopharma Deal: IGM Biosciences – Sanofi IgM Antibody Platform for Cancer and Immunology/Inflammation
The top deal upfront for March 2022 was the IGM development and commercialization deal with Sanofi for cancer, immunology, and inflammation. IGM will receive $150M up front and is eligible to receive up to $6.015B in regulatory and commercial milestones, which includes $940M for each of 3 cancer targets and $1.065B for each of 3 immunology/inflammation targets. Additionally, Sanofi has expressed an interest in purchasing up to $100M of IGM non-voting common stock in a public financing.
The top deal upfront for February 2022 was the Heidelberg development and commercialization partnership with Huadong for HDP-101, HDP-103, and options for HDP-102 (CD37-ATAC) and HDP-104. Heidelberg will receive $20M up front and is eligible for up to $449M in milestones with additional $461M in option payments upon exercise. Additionally, Huadong will invest EUR 105M (35%) in Heidelberg, with an initial commitment of EUR 80M by purchasing 12,408,649 shares at EUR 6.44 per share.
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