Private equity investment in biopharma
Private equity investment in biopharma is surging. Although private equity firms have been investing in biopharma for years it is the nature of this surge that is interesting.
Private equity is increasingly focusing on two activities:
• Providing growth capital – biopharma companies reaching critical late-stage development or growth juncture seeking substantial capital
• PE-backed acquisition and buyouts of biopharma companies
Opportunities for biopharma
These activities bring opportunities for enterprising biopharma companies to achieve their strategic goals and accelerate growth. How biopharma companies should position themselves to private equity depends on their strategic objectives. We see three clear opportunities for biopharma:
• Sellers – biopharma can spin-off or out-license non-core assets to enable greater strategic focus
• Buyers – biopharma can see private equity firms as a rich source of assets to support portfolio growth
• Competitors – biopharma can differentiate themselves clearly from PE firms and provide attractive alternative M&A opportunities for other biopharmas
The trend of PE entering the market brings our client work into the spotlight where we help clients form strategies that suit their ownership structure and support clients to protect against market changes and address margins.