UK biotech defies global market pressures, secures £808 million in Q3, reports BIA 

21 October 2024, London, UK - The UK biotech sector secured an impressive £808 million in Q3 2024, defying tough global market conditions and demonstrating sustained investor confidence. This is the finding of the latest report from the BioIndustry Association (BIA). 

Venture capital funding remained robust, with VC financing for the sector reaching £536 million across 18 deals, reflecting a 13.8% decrease from Q2. Yet the figure for this quarter remains above the recent historical average meaning that, based on a long-term time frame, there is sustained investor confidence in the sector.  

Early-stage investments proved particularly strong, with Series A rounds raising £193 million from a total of five deals. Noteworthy transactions included Myricx Bio, which secured £90 million in a Series A round, and F2G, which raised £76 million in a Series H round. The volume of deals completed is indicative of the ongoing ability of UK biotech companies to attract capital for innovative research and development. 

Other report findings: 

• Strong investor appetite for established companies 

Despite no IPO activity for the ninth consecutive quarter, total follow-on financing for 2024 was £1.61 billion, marking the highest total in the last five years and reflecting an enduring investor appetite for established biotech companies, even in a challenging market environment. 

• Global comparisons and UK’s competitive edge 

Venture capital investment in biotech on a global scale surged to £6.96 billion in Q3 2024, representing a 90.2% increase compared to the previous year, with the US leading at £4.54 billion, while the UK emerged as the top performer in Europe, attracting £536 million, followed by Germany at £221 million and Switzerland at £170 million. 

CEOs letter to the Chancellor 

In addition to the promising financial results, the BIA has been actively advocating for further government support for the biotech sector. Steve Bates OBE, CEO of the BIA, recently led an initiative with 150 industry CEOs, who signed a letter to the Chancellor, urging her to prioritise innovation in the upcoming Budget and maintain R&D tax reliefs. 

As a result of BIA's sustained campaigning, Rachel Reeves announced at the International Investment Summit that Labour will "maintain the rates of relief for R&D, which provide generous support for innovation." This commitment, achieved through BIA’s close relationship with the Treasury over many years, reinforces the strong foundation for the biotech sector’s future growth. BIA continues to advocate for life sciences innovation to be a key focus in the government’s industrial strategy and upcoming Budget on 30 October. 

Steve Bates OBE, CEO of the BIA, commented: 

“The resilience of the UK life science sector since the 2021 financing peak is undeniable. It is encouraging to see new companies emerging even in the face of tough conditions. With venture investment still going strong, our data shows the Labour government is right to prioritise a key UK growth sector of the future. 

He added: 

“Private investors are realising opportunity that public market data just doesn’t show in UK life science. It’s vital, if we are to get UK pension funds to invest in UK life science, that more data on the actual returns in UK life science from private investment are put in the public domain.” 

Looking ahead, the UK government’s industrial strategy, which prioritizes life sciences and aims to attract global investment, is set to create an even more supportive environment for biotech innovation. This will enable the UK biotech sector to sustain its competitive edge on the global stage. 

The BIA’s report signals that despite economic uncertainty, the UK biotech sector is well-positioned for future success given strong investor confidence, early-stage innovation, and the promise of sustained government support. For a comprehensive analysis of these key trends and what they mean for the future of UK biotech, we invite you to read the full report at https://biotechfinance.org