PwC: LIFE SCIENCES VENTURE CAPITAL FUNDING DROPS

By Rob Starr, Content Manager, Big4.com

A new PwC report, “Double-digit dip” that includes data from the MoneyTree™ Report from PricewaterhouseCoopers LLP and the National Venture Capital Association based on data provided by Thomson Reuters, US venture capital (VC) funding in the life sciences sector, which includes the Biotechnology and Medical Device industries, dropped 14 percent in dollars and 7 percent in deals during 2012.

For all sectors, VCs invested $26.5 billion in 3,698 deals in 2012, a 10 percent drop in dollars and 6 percent decline in deals from the prior year. Venture investors funneled $26.5 billion into 3,698 deals during 2012. While total investments saw a decline for the year, Deal volume in Q4 2012 rose 5 percent compared to the prior quarter.  However, dollars invested did decline 3 percent over the same time period to $6.4 billion in 968 deals according to PwC.

Medical Device investments fell 13 percent in dollars and 15 percent in deals in 2012, finishing the year with $2.4 billion going into 313 deals.  For the fourth quarter, Medical Devices saw an increase of 32 percent in dollars and 9 percent in deals from Q3 2012 with $581 million going into 74 deals.  The Life Sciences sector accounted for 25 percent of all venture capital dollars invested in 2012 compared to 26 percent in 2011 PwC reports.

PwC reports the top three metropolitan regions receiving Life Sciences venture capital funding during 2012 were San Francisco Bay ($1.7 billion), San Diego Metro ($709 million), and NY Metro ($415 million).  In Q4, the top five metropolitan regions receiving funding were San Francisco Bay ($588), Boston ($278), NY Metro ($214), San Diego Metro ($142), and the Great Lakes ($94 million).  Investments in Biotechnology deals accounted for 71 percent of the dollars invested in the top five regions in Q4 2012.