It has been a challenging opening first quarter for companies developing new therapeutics, with the BioWorld Drug Developers index recording a 9% drop in value, representing a stark contrast to its more than 35% growth last year.
The biopharmaceutical sector is showing no signs of slowing the pace of attracting capital. After coming off a record year, global private and public companies collectively raised $37 billion in the first quarter, indicating that it could be another bumper year for financings.
With the massive amounts of capital raised by global public and private biopharmaceutical companies last year generating approximately $134 billion – a total that was almost double the previous record of about $69 billion raised in 2015 – it is not surprising that financing for the regenerative medicine and advanced therapy sector also set an annual record.
The rapid development of mRNA vaccines to combat COVID-19 has highlighted the importance of this single-stranded molecule. Although there have been some costly developmental bumps along the way, interest in RNA-targeted therapies is once again surging.
With the prevalence of central nervous system disorders such as Alzheimer’s disease, multiple sclerosis, epilepsy, Parkinson’s disease and stroke increasing annually, the need for novel therapeutics to treat neurologic and psychiatric disorders has never been greater. Unfortunately, even though there is a significant unmet medical need, because of the high risk and low approval rates of drugs targeting those devastating diseases, in the past decade big pharma companies have been dramatically reducing their R&D spending on CNS disorders, noted Naheed Kurji, president and CEO of Toronto-based Cyclica Inc.
According to an analysis conducted by BioWorld of the 2020 financial reports filed by public biopharmaceutical companies with market caps greater than $1 billion, and excluding big pharma companies, the amount that was invested in research and development (R&D) during the year increased by 23% compared to the same period last year.
With the clock ticking on the urgent need to develop new antibiotics, the ongoing COVID-19 pandemic has given policy makers a sharp reminder that society should not lose focus on antibiotic resistance as well, which has the potential to dwarf COVID-19 in terms of deaths and economic costs. The Centers for Disease Control and Prevention, for example, noted in its Antibiotic Resistance Threats in the U.S. 2019 report that more than 2.8 million antibiotic-resistant infections occur each year, and more than 35,000 people die as a result. Against a universal decline in the effectiveness of antibiotics, there has been a renaissance of interest in using phage therapy, whose use has waxed and waned for almost a century.
In the opening panel of the BIO CEO & Investor digital conference BIO president and CEO Michelle McMurry-Heath explored some of the key issues that are currently impacting the sector with Adena Friedman, president and CEO of Nasdaq, which, this month, marks the 50th anniversary of its launch in 1971.
Biopharmaceutical companies developing cancer therapies had a productive year with about 38% of the record 53 new medicines approved by the FDA targeting oncology indications. This was one of the contributing factors for the 21% growth in the valuation of the price weighted BioWorld Cancer index in 2020.