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German biotechnology report 2011 - EY - Global

German biotechnology report 2011

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Availability of venture capital recovered significantly to reach 279 million euro in 2010 – more than three times as much as in 2009.

Focusing on the new momentum in the German biotechnology industry can help achieve a sustainable future.

Germany's biotech sector catching up

Despite Germany's general economic recovery, the biotech sector still lags significantly behind other countries, including the United States.

Last year, the theme of our German biotechnology report was "New Rules" and focused on changing business models, alternative funding and using capital most efficiently. These rules helped make the most of an absolute low in venture capital financing with only about 80 million euro left for the whole biotech sector in Germany.

This year, the theme of our report is "Putting things on the right track." We look at whether the measures taken around the new rules put things on the right track in 2010.

Overall, the answer is yes, but there is still room to grow.

Defining events for the German biotech sector

Here are a few of the notable events and trends in the German biotech sector in 2011.

  • German biotech companies have adapted their business model to sustain the funding crisis and to better leverage increased outsourcing and partnering opportunities with pharma companies.
  • Availability of venture capital recovered significantly to reach 279 million euro in 2010 – more than three times as much as in 2009; however, this increase is associated with few very big financing rounds led by two family offices (Struengmann / former owners of Hexal; Hopp / founder of SAP).
  • Alternative funding sources are becoming visible and more relevant.
  • Capital market interest for biotech is weak; public company financing mostly through PIPEs and rights offerings to existing investors.

Key metrics and financial data of the German biotech industry
  Private companies Public companies Total industry
  2009 2010 09/10 2009 2010 09/10 2009 2010 09/10
Key metrics      
No. of companies 384 386 1 % 15 14 -7 % 399 400 < 1 %
No. of employees 8,095 8,421 4 % 1,714 1,622 -5 % 9,809 10,043 2 %
Financial data (mil. €)      
Revenues 771 850 10 % 221 209 -6 % 992 1,059 7 %
R&D expenditures 619 645 4 % 158 164 3 % 777 809 4 %
Loss -338 -334 -1 % -151 -117 -22% -489 -451 -8 %

Source: EY, 2011

 


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