COVID-19 leads to unpredictable IPOs and venture financing deals for biopharma companies, says GlobalData

In this unprecedented time of uncertainty, key markets have lost 20–70% of their value year-to-date due to COVID-19, according to GlobalData’s COVID-19 Executive Briefing.

Sharon Cartic, Associate Director for Drugs and Business Fundamentals Databases at GlobalData, comments: “This drop in value is inevitably having an impact on the initial public offerings (IPOs) of biopharma companies developing therapeutics on both sides of the Atlantic.”

According to GlobalData’s Pharma Intelligence Center Deals Database, IPOs for biopharma companies developing therapeutics completed in the first quarter of 2020 have seen a drop of almost 30% compared to 2019, which is even more worrisome when considering that 2019 saw a 25% increase in IPOs compared to the same quarter in 2018.

Cartic continues: “There are some biopharma companies such as the Philadelphia-based gene player Passage Bio and Beijing’s InnoCare Pharma (focused on early-stage oncology) that went public during these turbulent times. Other companies, including Keros Therapeutics, Legend Biotech, Ayala Pharma, Zentalis Pharma and Lyra Therapeutics, are queuing up for the right time.

“The ‘IPO window’ (good market conditions for going public) is effectively shut down and companies may have to wait until market stability returns.”

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