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.
To read the rest of this article click here
[Editor's note: More news on the pharmaceutical and biotech industries is available each day in 2 'The Pink Sheet' DAILY . Visit our Web site to 3 sign up for a free trial.]
