Viral infection treatments, cell therapy, and artificial intelligence led biotech investments in January 2022 as the European sector took a collective breather from December’s funding frenzy.
European biotech investments started 2022 at a modest level compared to the huge cash flow seen in November and December 2021. While December 2021 saw almost €1.6B money raised, January’s total hit €660M in 41 deals. These included private investments and initial public offerings going to life sciences companies in Europe and Israel.
Private biotech investments drove nearly all of January’s funding; the UK firm Genflow Biosciences launched the only biotech IPO, raising €4.4M on the London Stock Exchange. The firm challenged a stormy biotech stock market, which has caused headwinds for biotech IPO hopefuls in the last few months.
Industrial biotech companies in particular saw a plunge in investments in January. European firms in this sector collectively raised less than €10M in equity investments compared to over €300M in December. In contrast, biotech companies developing healthcare solutions and enabling technologies raised similar levels of funding to previous months.
The biggest biotech investment round in January was raised by Leyden Labs in the Netherlands. The firm bagged €124M in a Series B round to finance the development of nasal sprays to protect against influenza and coronavirus infections.
In second place, an €88M Series B round closed by the UK-based Ori Biotech will finance the development of automated mini-factories that can speed up the manufacture of cell therapies.
One notable round from an industrial biotechnology player was raised by the UK-German firm AlgaeCytes to fund the production of fish oils from microalgae. The round consisted of €5M from venture capitalists and an €11M grant from the German government, which was not included in this analysis.
The top Series A round in January went to the tissue engineering firm Engitix. The UK company landed €48M to fund the development of a pipeline of treatments discovered with the help of its tissue models for liver disease.
SeqOne Genomics, in second place, raised the latest of a string of venture rounds going to bioinformatics players. The French firm’s €20M Series A round will bankroll the development of cloud-based software designed to accelerate the adoption of genomics and personalized medicine in hospitals.
In Austria, a Series A round from Ribbon Biolabs demonstrated investor interest in the synthesis of DNA molecules. This trend was punctuated by a €30M Series C closing from another DNA producer — DNA Script — earlier in the month.
Biotech seed investments in January 2022 were dominated by drug discovery, manufacturing, and diagnostics. The leading seed round, worth €16.7M, was raised by the Israeli company Quris. The round will fund preparations for clinical trials of a drug for the genetic disorder fragile-X syndrome that was designed with the help of artificial intelligence (AI).
Another Israeli AI firm called Protai took second place. The company is developing a drug discovery platform focused on harnessing proteomics to hunt for drug targets.
Life sciences companies using AI technology had a rollercoaster month in January. The UK heavyweight Exscientia signed a lucrative €4.6B deal with Sanofi to develop treatments for cancer and immunological conditions with the help of AI. However, the tech giant IBM caused shockwaves when it pulled out of its healthcare AI division a few weeks later.
The coming month may see private biotech investments pick up again. Within the first few days of February 2022, two major funding rounds have already been announced by the UK companies Biofidelity and Nuclera.
However, public markets remain volatile, which could discourage many European biotech companies from launching IPOs in the coming weeks.