U.S. BIOPHARMACEUTICAL VENTURE INVESTING DOWN SIGNIFICANTLY FROM 2011 LEVELS

As reported by Dow Jones, U.S.-based biopharmaceutical companies raised a total of $570 million via 54 venture capital deals during the second quarter of 2012 - a decline of 22% in deals and a decline of 43% in capital invested as compared with the second quarter of 2011.  Across all sectors, the number of deals and capital invested fell by 9% and 3%, respectively. 

While certain sectors appear to be somewhat healthy, the outlook for healthcare / biopharmaceutical venture investment remains somewhat bleak: 

“IT and Internet investment has been steady but interest in capital-intense industries like healthcare and energy is fading,” said Brendan Hughes, director of information analysis for Dow Jones VentureSource. “The unpredictable environment for IPOs – the traditional exit for biopharmaceuticals companies – has entrepreneurs and investors struggling to find new business models.”

Investment in medical device and healthcare companies declined during second quarter 2012 as well.  The only healthcare-related sector that appeared to fare well was healthcare IT, which recorded a 45% increase in deals and a 33% increase in the amount of capital raised.

[Dow Jones]