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Infographic – US Biotech Venture Deals Slow in Q1

Chart: Biotech venture deals

Click on image for full-size view (PitchBook-NVCA Venture Monitor)

23 Apr. 2022. The rate of new venture deals for biotechnology start-ups in the U.S. slowed in the first quarter of 2022, but total dollars invested remain on track from last year. The Pitchbook-NVCA Venture Monitor (registration required) provided the data earlier this month, as part of its quarterly report on the state of venture capital in the U.S.

The Pitchbook-NVCA data show venture investors made 245 deals with biotechnology and pharmaceutical companies in the first three months of 2022, about 19 percent of total venture transactions in this sector in 2021. But biotech and pharma start-ups raised $10 billion during Q1, 27 percent of 2021’s total investment volume for this industry group last year, suggesting a good start in reaching at least the same dollar level in 2022.

The smaller number of U.S. biotech and pharma venture deals in Q1 also suggests larger dollar volumes per deal, and the report’s data bear that out. The average deal size for this sector in the first quarter was $46.1 million, up sharply from a $32.1 million average in 2021. The median deal size in the first quarter, half-way point in the range from largest to smallest transaction, is $11 million, up from $10 million in 2021.

Venture investors continue to favor making late-stage deals in Q1 2022, an increasing trend for the biotech and pharma sector in the past few years. About 40 percent of first quarter deals were late-stage deals — third venture rounds, known as series C or later — while about a quarter of the deals went to angel and seed-stage start-ups, and roughly a third were first or second venture round deals. The percentage of angel- and seed-stage deals, those with the newest start-up companies, continues to fall, from about a third of all deals in 2019.

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