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15 Mar 2022

Report reveals 2021 was another bumper year for biopharma deal-making

The largest sums of capital were awarded to US biotech companies, followed by companies based in Mainland China and the UK

2021 was yet another extraordinary year for biopharma deal-making — licensing, collaborations and joint ventures — despite the reduced volume of biotech investments, according to a new report by Clarivate. 

The report, Biopharma deals in review: Review of an extraordinary 2021 and expectations for the future, finds RNA, cell and gene therapies, artificial intelligence (AI), genome editing (CRISPR) and oncology-related deals dominated the landscape in 2021.

A record 1,968 deals were announced in 2021, and the total value of these ventures for which financial details were disclosed was $213.6 billion, up from $198.2 billion in 2020.

Of the past five years, 2021 saw the highest total financing and deal value. This was driven by a number of high-value transactions: 72 deals were worth at least $1 billion, for a combined value of $136.5 billion.

So what were the trends driving licensing, collaborations and joint ventures last year?

In essence, they included a maturation of deals towards co-development and co-commercialisation, as well as the increasingly global nature of deal-making.

The continued drive in oncology therapeutics and pharma companies seeking footholds in the enabling technologies underpinning next-generation treatments also shaped biopharma deals in 2021. 

Several of the top deals involved co-development and co-commercialisation of assets. Capital investments are becoming a less attractive proposition as well-financed biotech companies are leaning towards deals that allow them to retain commercialisation rights and integrate their assets across the development lifecycle.

The report also identifies that biotech companies in the US were awarded the largest sums of capital, the majority of which came from private and venture sources, accounting for 67% of all funds raised worldwide.

By comparison, biotechs based in Mainland China had a 12% share of the global take, putting them in second place, while UK-based biotech companies came in third with a 9% share.

Partnerships established by companies in the Asia-Pacific (APAC) region indicate there is growing interest in accessing global markets, potentially with the goal of maximising the returns on investment beyond what can be achieved in their local markets.

According to Clarivate's Global Head of Life Sciences and Healthcare Thought Leadership, Mike Ward, while some pharma companies will still seek to acquire potential blockbuster treatments to replace existing products that are losing patent protection, others are "urgently" looking for routes into the enabling technologies being developed by biotechs.

These technologies are gene and cell therapies, genome-editing, antibody-drug conjugates, RNA technologies and AI/ML (machine learning) applications, which have gained much recent traction and are expected to underpin the next generation of transformative blockbusters.

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