In 2017, the European biotech sector witnessed a volume increase in IPOs and follow-on financings. This says the most recent capital market report of BIOCOM which is published during BIO-Europe on November 6.
Following the more cautious year 2016, the European biotech sector witnessed a volume increase in IPOs and follow-on financings in 2017. Taking all indicators into account – number and volumes of IPOs, follow-on financings and secondary listings – the 228 European biotech companies raised €2.49bn by Q3 2017, 29% more than in the same period in 2016 (€1.93bn). More than half the money (54%, €1.34bn) was raised on US Nasdaq, highlighting the power of biotech-focused investors available through the US stock market. In terms of numbers, however, Europe is in front. A majority of 11 firms opted for one of the 14 European trading centres, with three firms floating on US Nasdaq instead.
Report published during BIO-Europe
These are the key findings of the "5th Analysis of European Biotech Companies on the Stock Markets: US vs Europe" released by German market analyst BIOCOM AG, published on the occasion of BIO-Europe 2017 in Berlin. “Overall figures for 2017 demonstrate that IPOs and listings have become established as a viable route for European biotech companies to raise capital. With regard to volumes, however, the US stock market generally offers a mich better yield due to a greater diversity of biotech investors,” says Sandra Wirsching, responsible for the report at BIOCOM.
23% increase compared to 2016
According to the analysis, a total of 14 European biotech IPOs had taken place by Q3 in 2017, raising a total amount of €529m. This marks an increase of 23% compared to the same period in 2016 (€429m). A majority of 11 firms opted for one of the 14 European trading centres, only three firms floated on US Nasdaq. Among the European trading centres, Paris (45) and London (43) are the top locations with the highest number of listed biotech companies. (see chapter "New wave of optimism")
Euronext most attractive stock exchange in Europe
As stated in the report, cross-border stock market Euronext still is among the most attractive stock exchange for European biotech companies. Three of this year’s listings took place there. Euronext’s Techhub initiative is explained in greater detail in a separate section. It offers special services for small and medium-sized companies and now has offices in Italy, Spain, Switzerland and Germany. (see chapter "Focus on Euronext")
The analysis also reveals that in 2017 a new wave of listings took place in Scandinavia, among them one in Oslo and five in Stockholm. For this reason, the Swedish capital has now caught up to Paris and London with a total of 40 listed biotech companies.
US Nasdaq experienced revival
When it comes to follow-on-financings, 2017 has recovered significantly compared to 2016. A total of €1.96bn was dropped into the companies, a substantial 33% increase compared to the same period in 2016. “Investors’ enthusiasm for biotech companies has returned in 2017,” says Wirsching. This is particularly true for US Nasdaq where the market experienced a revival with a 176% increase compared to 2016. The 33 companies listed in the US attracted a combined total of €1.1bn in follow-on-financings, including three secondary listings (Verona Pharma, argenx, Zealand Pharmaceuticals) which amounted to a total capital of €251.5m alone. (see chapter "Focus on US Nasdaq")
Focus on German expertise in immunooncology
The report also highlights the strength of the German biotech sector. Two pioneering immunotherapy specialists – Affimed N.V. and MOLOGEN AG – are portrayed in this year’s report.
Affimed was one of the first European biotech companies that profited from the open IPO window in the US. Since its listing on Nasdaq in 2014, it has managed to raise more than US-$140m. Florian Fischer, CFO of Affimed, says, “With an approach that focuses on tetravalent bispecific antibodies engaging immune cells, we are top of the league in a highly competitive environment. With our competence in NK cell engagers in addition to the more common T cell approach and our unique technology platform, we’re not doing the same as ten other companies.” (see company profile with CFO Interview)
Berlin-based MOLOGEN AG is also a pioneer for many reasons: firstly, the company had already recognised the potential of the body’s own immune system to fight cancer or other diseases by the 90s – long before immuno-oncology hit headlines across the globe. Secondly, MOLOGEN was one of the first German biotech companies to list on the stock market, taking this step shortly after its foundation in 1998. CEO Mariola Söhngen points out, “The capital markets here in the EU have supported the growth of the company over a long time. Given the further development of the company, we are now also looking into other markets and have just attracted a US investor in our last financing round.” ( see company profile with CEO Interview)
More information about BIOCOM's "5th Analysis of European Biotech Companies on the Stock Markets: US vs Europe" as full report: