Biotech VC dollars rise, but deal numbers fall

The best thing that can be said for venture capital investment into the life sciences sector in the first quarter of 2011 is that, despite the risks involved during risky financial times, there was no big stampede away from biotech. This is according to Mark Heesen, president of the National Venture Capital Association, in a news release announcing a new MoneyTree Report released by PricewaterhouseCoopers, the NVCA and Thomson Reuters.

"What we are not seeing this quarter is just as critical as what we are seeing," Heesen said. "We are not seeing venture capital dollars flooding any particular sectors, including the Internet or clean technology. And we are not seeing a mass exodus from sectors, such as life sciences, where significant challenges lie."

The Life Sciences sector, which is the biotechnology and medical device industries combined, saw an increase in VC dollars invested during the first quarter, rising 16 percent but falling 9 percent in deal volume from the prior quarter to $1.4 billion going into 164 deals.

As for biotech in particular, it placed third, rising six percent from the prior quarter to $784 million in the first quarter of 2011. The number of deals dropped in the first quarter, falling 17 percent to 85 from 103 in the fourth quarter of 2010, according to the news release. The quarter saw the fewest number of biotech deals since the second quarter of 2003.

- read the release
- and Fortune’s Dan Primack puts the numbers in context

Special Report: Top 15 Biotech Venture Capital Deals of 2010