Biotech fundraising sours in a bleak first half

The flow of venture capital dollars into the biotech industry is rapidly slowing down. In its snapshot of second quarter trends, Bloomberg Industries is reporting that there were only 59 deals in the last quarter, with a woeful average of $9.3 million a deal. That amounts to the smallest financing amounts since '07, reports the Boston Business Journal. Overall, global VC flow into biotech plunged 43%, down to $550 million, with the lion's share going to U.S. companies.

European biotechs drew only $48 million of the total, notes the BBJ, the hometown newspaper to one of the world's largest biotech hubs. And Third Rock Ventures, which has been wheeling and dealing from the launch of its latest fund, proved the most active investor.

Those figures are in line with a bleak set of numbers drawn together by BioWorld's Peter Winter, who found that biotechs raised $2.76 billion in the second quarter, down 46.4%. For the full first half of the year, private and public biotechs raised only $7.9 billion, down 40% from the same period in 2011. And Winter bearishly interpreted the data as a bad sign for the months ahead.

To cap it off, we reported yesterday that biotechs are seeing shrinking amounts of total deal sizes for their licensing pacts so far this year. The financial squeeze is coming from every side, with M&A offering one of the few bright spots for industry investors as IPOs remain few and far between.

- read the story from the Boston Business Journal
- here's the BioWorld piece from Peter Winter

Special Report: Top 20 biotech licensing deals in H1 2012

Related Articles:
Price curmudgeons at NICE prep early-stage advice for VCs
BIO's James Greenwood sees industry optimism returning
Pharma VC embrace improves a biotech's chance of success