The Top European Biotech Investments in March 2022

finance top biotech investment March 2022

As wars and inflation buffet European markets, private biotech companies raised fewer investments in March 2022 than in previous months. The top private rounds went to firms developing cancer treatments and microbiome therapeutics.

The first quarter of 2022 has seen a gradual decline of biotech investments in the European space. The total raised by European and Israeli biotech companies in March 2022 — €506.8M in 43 deals — is the lowest since October 2021. It was also 25% lower than February’s performance: 52 deals totaling €664M.

The faltering private investments echo huge volatility in biotech public markets. Inflation and a growing energy crisis are plaguing nations worldwide, all the while exacerbated by the raging war in Ukraine.

It’s no surprise that private funding has dropped compared to previous months,” said Antoine Papiernik, Chairman and Managing Partner at the venture capital firm Sofinnova Partners. “All funding is down. If biotech funding had not gone down in [the first quarter] of this year, I’d be more concerned because it would indicate a deeper misunderstanding of the larger trends and context.

Cancer research in March attracted more than double the private investments that it received in February. Other large funding rounds went to biotechs tackling genetic diseases and conditions affecting the nervous system. 

Meanwhile, startups specializing in manufacturing and drug discovery were the investor favorites in the sector of life sciences enabling technologies. In the industrial biotech space, companies developing protein alternatives such as cultured meat received the most attention. 

Notably, there were no advanced venture capital rounds such as Series C rounds in the mix; the highest stage of private biotech investment rounds was Series B funding. Additionally, no European biotechs braved the stock markets in an initial public offering (IPO).

The Belgium-based Precirix raised the top private biotech investment in March with an €80M Series B round. The company is developing radiopharmaceutical drugs based on fragments of antibodies derived from llamas and camels. Another radiopharmaceutical heavyweight, ITM Isotope Technologies in Germany, also made it to the top ten with a €33M private investment.

In second place, the UK firm Microbiotica set the record for microbiome investment rounds in Europe. The €61M Series B round will be used to advance the company’s live microbiome therapeutic for cancer and ulcerative colitis.

Cystic fibrosis was also in the limelight as the Italian company Kither Biotech staked its niche in the space. Kither’s €18M Series B will fund the development of drugs that can enhance the action of existing cystic fibrosis drugs and allow more patients to benefit from recent advances.

The Dutch company Scenic Biotech led the Series A winners in March by raising €28M. The company is one of an emerging group aiming to activate protective genes in the fight against rare diseases such as Niemann-Pick type C. 

Mycorena’s €24M Series A took second place in the lineup. The company is developing the means to manufacture protein by cultivating fungi; the protein can be used to produce synthetic leather and as an ingredient in cultured meat. 

The bulk of March’s seed funding went to companies developing solutions for industrial biotechnology. The leader was Arkeon Biotechnologies in Austria, which aims to capture waste carbon dioxide and use microbes to convert it into protein food ingredients. Other food specialists in the seed round winners were Polaris in France and Wanda Fish, an Israeli firm developing cultivated fish meat.

Brenus Pharma in Lyon raised €4M to fund the development of a cell therapy to treat colorectal cancer. Unlike approved CAR-T therapies, which involve genetically engineering a patient’s immune T cells to fight blood cancer, Brenus engineers tumor cells to activate the immune system against solid tumors.

In spite of the poor outlook in March, public biotech investments still showed some surprises. One was the Dutch giant argenx, which raised an impressive €637M ($700M) in a global public offering. The firm’s drug efgartigimod (Vyvgart) was approved by the FDA for the treatment of the autoimmune condition myasthenia gravis in December 2021, which may have attracted investor interest as the firm establishes itself in the US market.

And while there were no IPOs by European biotech companies in March, April has seen the merger of the Swiss firm MoonLake Immunotherapeutics with the special purpose acquisition company (SPAC) Helix Acquisition. This took MoonLake public without the need to undergo a traditional IPO, which is more vulnerable to market conditions than a SPAC merger.

Additionally, Pfizer took over the UK firm ReViral for up to €481M ($525M) in early April. This takes place as big pharma companies have been generally slow to acquire biotech companies in the last months.

Despite the tumultuous economic times, there are many signs that Europe’s biotech industry is growing in strength, especially with the big increase in funding going to venture capital firms in life sciences. 

The amount of cash in the coffers of venture and growth investors means that the most promising companies will still get funded,” said Papiernik. “In fact, the trend we are seeing is that companies who do secure funding will be in better shape for longer periods. 

This is what we are advising our companies to do: aim for sufficient funding for three to four years rather than one to two years, and ensure they can show more by the time they go back to market.

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