Each quarter, Locust Walk deal team members compile key statistics and trends on strategic transactions and financings. Our 2021 Q1 Report: Global Trends in Biopharma Transactions applies the latest data to analyze current activities in the life sciences deal landscape. 2020 was a record year for financings across the globe and that trend continued into Q1 2021 for public and private financings alike. With a red hot capital markets environment, we’ve pondered whether or not the traditional route of early stage collaborations will remain as a mainstay for high-growth biotechs in the near-term. Join us for a webinar as we have an open discussion about that topic. We look forward to following the trend lines in Q2. A few more key insights across geographies in Q1 2021:

United States

• Biotech indices underperformed the broader markets in Q1, likely over concerns around potential drug pricing reform and movement out of biotech and into “reopening” stocks
• The US biopharma IPO momentum of 2020 carried into the first quarter of 2021, surpassing Q3 and Q4 2020 in both deal volume and aggregate value and with new IPOs outpacing the performance of key biotech indices
• Total biotech SPAC IPO values reached nearly $2B in Q1 suggesting the SPAC trend is not slowing down. Multiple sponsor firms have backed 2nd SPACs prior to completion of their target acquisition from their first
• Public and private financing activity remains notably robust, as companies seek to take advantage of the open IPO window and growing interest from private investors
• Q1 closed out a record quarter for private financings, and 2019/2020 biopharma IPOs continue to perform well in the public markets, suggesting investors are bullish long-term on new biopharma opportunities
• Strong deal flow among both licensing and M&A deals demonstrate sustained interest in strategic transactions despite dwindling total deal values

Europe

• Vaccines, albeit with significant logistical hurdles, bring hope to recovering the “old normal” in the European Union at the end of this year. Throughout Q1 2021, Moderna’s, AstraZeneca’s and Janssen’s COVID-19 vaccines were approved by the EMA
• Private financing in European biopharma companies keeps with last year’s uninterrupted growth trend, amounting a total of ~$1.4B in Q1 2021
• European biopharma IPOs had a great year start as well, with 4 IPOs over $100M on the Nasdaq and several smaller IPOs on other global exchanges. In contrast, only one IPO took place in Q4 2020
• European licensing deals saw a slight increase in deal value in Q1 2020, while M&As significantly decreased in Q1 with only 3 completed deals

Japan

• The Japanese stock market is off to a bullish start in 2021, as the Nikkei 225 Index reached the 30,000 mark for the first time in over 30 years
• The pharma and biotech sector had a strong performance in Q1 2021 alone (+8% and +16%, respectively), but overall growth of the two sectors since the beginning of 2020 is below market
• The volume of deals in 2021 is at the similar pace as 2020, largely due to a dominant quarter by Takeda, who struck 6 deals including 2 over $1B in total deal size
• Following a strong year in venture financing in 2020, Q1 2021 was even stronger: 8 deals with aggregate value of $67M which is more than double the value in Q1 2020

China

• Slow quarter for the Chinese stock market, as the SSE Composite Index was down 1.7% in Q1 2021 and average share price of top Chinese pharma companies was flat for the second consecutive quarter
• In-licensing deal volume in 2021 is similar as Q1 the previous year, but with larger value: 22 in-licensing deals were closed including 20 deals with over $50M in total deal size and 15 with over $5M upfront payment
• Out-licensing activities continues in 2021, including 2 deals over $1B, both of which involving anti-PD-1 antibodies
• Venture financing for biotech companies continue to exceed previous levels, as 47 companies raised capital for an aggregate total of $3B in Q1 alone, already surpassing full year values in 2018 and 2019

Locust Walk is a global life science transaction firm. Our integrated team-based approach across capabilities, geographies, and industry segments delivers the right products, the right partners, and the most attractive sources of capital to get the right deals done for biopharma and life science companies.

• Capabilities: cohesive strategy, market analytics, and transaction capabilities
• Geographies: global footprint across all key life science geographies
• Deal process: one globally-integrated team focused on your entire deal process from strategy through execution