PricewaterhouseCoopers released a 2009 industry report on venture capital in the life science sector, which consists of the biotechnology and medical device and equipment industries.
Last year, the life science sector received most of the fundraising, namely 34% of all invested money. The biotechnology industry raised $ 1 billion in 108 deals; 87 medical device deals totalled $ 719 million. Even though the sector outpaces funding in all other industries, one should keep in mind that 2009 was the year with the lowest investment level since 1997.
Venture capitalists see opportunities for further growth within the sector, and the investment level is expected to increase in 2010. Tracy Lefteroff, global VC managing partner at PricewaterhouseCoopers, explains: “As the worldwide population ages and more people enter their years of greatest healthcare need, demand for new pharmaceuticals, diagnostics, and medical devices has the potential to go higher than we’ve ever seen.”
An increased amount of deal-making is expected in early-stage life science companies, as their need for venture capital is bigger, and they do not have an exit strategy yet. “Later-stage companies are finding other ways to generate cash, such as partnerships and licensing agreements with larger companies looking to expand their product pipelines.”, so Lefteroff.
