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    BIO Industry Analysis: 9th Annual BIO Investor Forum

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    This document summarizes key findings from an industry analysis of the biotechnology sector presented at the 9th Annual BIO Investor Forum in October 2010. It finds that there were 25% fewer publicly traded US biotech companies, but the remaining companies had more cash on hand. The 2010 IPO "window" was uncertain and there were fewer acquisitions and licensing deals completed for therapeutic biotech companies. The competitive deal-making environment had also increased substantially with over 17,000 one-on-one partnering meetings at BIO.

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    BIO Industry Analysis: 9th Annual BIO Investor Forum

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    119 views14 pages
    This document summarizes key findings from an industry analysis of the biotechnology sector presented at the 9th Annual BIO Investor Forum in October 2010. It finds that there were 25% fewer publicly traded US biotech companies, but the remaining companies had more cash on hand. The 2010 IPO "window" was uncertain and there were fewer acquisitions and licensing deals completed for therapeutic biotech companies. The competitive deal-making environment had also increased substantially with over 17,000 one-on-one partnering meetings at BIO.

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    This document summarizes key findings from an industry analysis of the biotechnology sector presented at the 9th Annual BIO Investor Forum in October 2010. It finds that there were 25% fewer publicly traded US biotech companies, but the remaining companies had more cash on hand. The 2010 IPO "window" was uncertain and there were fewer acquisitions and licensing deals completed for therapeutic biotech companies. The competitive deal-making environment had also increased substantially with over 17,000 one-on-one partnering meetings at BIO.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    119 views14 pages

    BIO Industry Analysis: 9th Annual BIO Investor Forum

    Uploaded by

    biotechnow
    This document summarizes key findings from an industry analysis of the biotechnology sector presented at the 9th Annual BIO Investor Forum in October 2010. It finds that there were 25% fewer publicly traded US biotech companies, but the remaining companies had more cash on hand. The 2010 IPO "window" was uncertain and there were fewer acquisitions and licensing deals completed for therapeutic biotech companies. The competitive deal-making environment had also increased substantially with over 17,000 one-on-one partnering meetings at BIO.

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    of 14

    BIO Industry Analysis

    John Craighead, Ph.D.


    Managing Director Investor Relations & Business Development 9th Annual BIO Investor Forum October 5, 2010
    This report contains information obtained from publicly available sources and is presented as a fair use of the material, or alternatively, contains information from sources that BIO has obtained permission to use the information. At the time of the presentation or publication, the information is believed to be accurate and reliable. BIO disclaims responsibility or any damages resulting from anyones use or reliance on the information provided. Any further distribution or use of the contents without appropriate attribution and reference to BIO and the source(s) is prohibited.

    % return since Oct 9th, 2007

    0%

    -40% 20% 40%

    -20%

    -60%
    Financials Telecom Energy Industrials Utilities Materials Health Care Technology Cons. Disc. Cons. Staples

    (Source: BIO, Factset, Sept. 27th, 2010)

    +1.6%

    NBI BTK

    BIOTECH SECTOR PERFORMANCE SINCE 2007 +38.8%

    IPO WINDOW YIELDS POOR RETURNS


    Median reduction from amount filed vs raised: -28% Median performance: -20%
    8% 20% 10% 0% -8% -16%
    -7%

    -10% -15% -19% -31% -40% -46% -50% -60% -70% -80% -17% -20% -30% -33% -36%

    -55%
    2010

    TLCR 2009

    -67%

    IRWD

    ANTH

    AVEO

    ALIM

    CDXS

    TNGN

    GNMK

    CRMD

    (Source: BIO, Factset, Sept. 22nd, 2010)

    OMER

    PATH

    CPIX

    TSRX

    FEWER US PUBLIC BIOTECH COMPANIES


    4Q 2007
    1 IPO

    4Q 2008
    13 IPO

    2Q 2010
    25%

    29%

    45%

    394

    28 Acquisitions 36 Inactive

    330

    34 Acquisitions 16 Inactive

    294

    Less than 1 Year of Cash on Hand


    (Source: BIO, Factset, Sept. 14th, 2010)

    FATE OF 131 COMPANIES WITH 1 YEAR OF CASH LEFT JAN 2009


    Survival Tactics 10 ACQUIRED 19 INACTIVE 102 ACTIVE

    Layoffs PIPE FOPO Out-Licensed Debt Issued Sold Assets

    41% 40% 39% 29% 11% 7%

    (Source: BIO, Factset, Sept. 14th, 2010)

    SMALL COMPANIES INCREASING CASH SPEND


    $4.0

    MEDIAN Quarterly CFO (-$M)

    $3.6 $3.5

    $3.0
    $2.5 $2.4

    $2.0 $2.0
    $1.5

    1Q08

    2Q08

    3Q08

    4Q08

    1Q09

    2Q09

    3Q09

    4Q09

    1Q10

    (Source: BIO, Factset, Sept. 14th, 2010)

    2Q10

    Cumulative Total of US IPOs


    10 20 40 50 60

    30

    70

    2009
    Cumberland IPO August 2009

    2010 US IPO WINDOW

    2010 2011 2012 2013

    JUL SEP NOV JAN MAR MAY JUL SEP NOV JAN MAR MAY JUL SEP NOV JAN MAR MAY JUL SEP NOV JAN MAR MAY JUL SEP NOV

    Cumulative Total of US IPOs


    10 20 40 50 60

    30

    70

    HOW IT ENDED LAST TIME:

    2003
    2004 2005 2006 2007

    JUL SEP NOV JAN MAR MAY JUL SEP NOV JAN MAR MAY JUL SEP NOV JAN MAR MAY JUL SEP NOV JAN MAR MAY JUL SEP NOV

    THERAPEUTIC BIOTECH LICENSING DEALS NOT FILLING THE GAP


    700
    # OF THERAPEUTIC DEALS PER YEAR

    600

    595 540 390

    500 400 300 200 100 0 2006 2007 2008 2009 2010*
    *YTD, Sept 15th

    347 217*

    (Source: BIO, Windhover, September, 2010)

    M&A NEVER PICKED UP FOR THERAPEUTIC BIOTECH COMPANIES


    60
    TOTAL # OF THERAPEUTIC ACQUISITIONS

    55 46 40
    38

    50

    40 30
    20 10

    21*

    0 2006
    (Source: BIO, Windhover, September, 2010)

    2007

    2008

    2009

    2010*
    *YTD, Sept 15th

    MORE LATE-STAGE M&A


    40%
    % OF TOTAL ACQUISITIONS
    35%

    2006-2009 2010

    38% 32%

    30% 25% 20%


    15%
    15% 14% 13% 19% 16% 24% 24%

    10% 5%
    0%
    5%

    PC
    (Source: BIO, Windhover, September, 2010)

    P1

    P2

    P3

    Competitive Deal Making Environment


    20000 18000
    16000 14000 12000 10000

    17,143

    # of 1x1 Partnering Meetings at BIO

    43% CAGR

    8000 6000 4000


    2000 0

    TAKE HOME MESSAGES


    25% fewer US public companies
    Remaining companies have more cash

    2010 IPO window is uncertain


    Fewer acquisitions and licensing deals

    More competitive deal making landscape

    Visit us online at insidebioia.com

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