Dramatic drop in biotech investment: France Biotech survey results for 2008/2009
Paris – The crisis over the last two years has significantly impacted investment levels in the French life science industry. This is one of the results of the 2008/2009 "Panorama" survey of the French and global life science industry presented by the industry organisation France Biotech on April 13th.
According to the study, the total amount of new venture capital investment fell from EUR151 million in 2008 to EUR65 million in 2009 - a 56% drop. Of the EUR65 million invested, EUR22 million went to seed- phase and Series A rounds of financing, with an average investment of EUR1.3 million. Even though the total amount of seed funding fell, the number of transactions remained stable (18 in 2008 and 17 in 2009) and emphasized continuing investor interest in life science. In contrast, the value of second and third rounds of financing fell strongly, down from EUR115 million in 2008 to EUR43 million in 2009. Even though the number of transactions remained stable in 2009 (16), the average investment fell by 76%.The figures further illustrated a relative slowing of the increase in turnover – increasing by just 2% between 2007 and 2008- versus 67% between 2006 and 2008. Thanks to public-sector policies and funding in favour of research, the authors of the report concluded that R&D investment efforts continued on roughly the same level. Late 2008 and then 2009 were marked by the French government's stimulus package in response to the global economic crisis, with creation of the €20 billion Fonds Stratégique d’Investissement (FSI) sovereign fund in December 2008. The pharma/biotech sector accounts for 10% of the investment opportunities reviewed by the FSI and is the second-ranked industrial sector in terms of actual investments, the study says.