Ernst & Young’s eight annual European life sciences report records that this sector saw a comparatively good year in 2000. The report notes that the current dominance by the UK may be challenged in coming years. It concludes this on the basis that only one of the top ten venture financings in 2000 was by a UK biotech company and none of the top ten IPO fund raisings (by amount raised) were undertaken by UK companies.
However, the UK led in follow-on offerings, with five of the top ten follow-on fund raisings indicating that the UK’s leading players remain strong. (The report cites players such as Cambridge Antibody Technology and Oxford Glycosciences in this category.)
The report, which covers entrepreneurial life science companies that use modern biological techniques to develop products or services to serve the needs of human or animal health, agricultural productivity, food processing, renewable resources or environmental affairs, found the market capitalisation of many companies increased by at least 100%. And up to 500% in some cases. Increasing public valuations had a knock-on effect on private equity fund raisings, with over 40 companies raising more than euro10 million in 2000 (compared to 18 in 1999).
The report also notes that despite a successful year, Europe’s biotech industry remains secondary to the US, which accrued a mass of new capital. It goes on to note that with vastly superior resources at their disposal US companies stand a greater chance of dominating their chosen niche within the sector.
It goes on to calls for greater cooperation between European countries in creating common pharmaceutical markets and adhering to agreed common patenting and drug registration procedures. It goes as far as to recommend a single European high technology equity market.