Nearly half (48%) of the 27 fundraisings by private European biotech companies so far this year have been for sums totaling $10 million or less, according to Elsevier's "Strategic Transactions" database. That's a significant increase over the same period in 2010, when less than 30% of financings were sub-$10 million.
Within this somewhat bleak picture, Series A rounds appear relatively healthy, though. The average A round during 2011 has raised more than $12 million, about the same as the region's single IPO.
Indeed, the growth of smaller fundraisings in Europe isn't only a private sector characteristic. Listed European biotechs, too, are finding their investors frugal. Eight of the 20 funding rounds for public European biotechs since the beginning of the year have raised $10 million or less. In the first seven months of 2010, there may have been only half as many fundraisings, but only one of these raised less than $10 million.
Investors' stinginess isn't really surprising. Beyond the aftermath of the 2008 financial crisis, which also hit funding in previous years, there are now ongoing concerns about the long-term health of the euro, and the potential of the sovereign debt crisis to spread from Greece, Ireland and Portugal to Italy and Spain.
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