Exclusive overview of 2013 UK Life Sciences Start-up Environment: The Fourth Annual

Review of Life Sciences Start-up Companies

Dr. Glenn Crocker

14.50 – 15.10 – Keynote Address

Early stage life sciences

Glenn Crocker CEO BioCity

BioCity Group

Nottingham

Glasgow

MediCity-Boots

BioHub- AstraZeneca

Catalyse business formation

Invest Rental income

Exit investment

Service income

Create deal flow and users of services

Create environment for tenant company success

Knowledge of companies lends to better investments

Early return

Investment return

£ £ £ £

What  we  do  

4

The world turned upside down

The kids are moving in… Ø  AZ  -­‐  Charnwood,  Alderley  

Park,  Lund…    Ø MSD-­‐  Newhouse  Ø  Pfizer  –  Sandwich….  Ø NovarDs-­‐  Horsham…  Ø  Sanofi-­‐  Dagenham,  

Toulouse,  Montpelier  Ø  Etc  etc  

Pharma Incubates Bayer- Colaborator- San Franscisco GSK- Stevenage Biocatalyst J&J- London, Boston, California, Shanghai

• Merck Serono- Israel But others quietly stopped: •  Pfizer •  Biogen-Idec

No more “I” in IP?

Autism- £25M 5 years

Lead discovery- €80M 5 years

Funding innovation GSK- $50M into $250M Sanderling west coast USA early stage fund GSK- £265M- Avalon start-up fund- San Diego Lilly-Roche- Indiana Research Institute - $50M start-up funding Merck KGaA- €60M addition to CV fund

What does this mean for early stage companies?

Focus on start-ups- the next generation and a sign of things to come BioCity UK Life Science Start-up review

Start-up activity declining in UK

275  

280  

285  

290  

295  

300  

305  

310  

315  

320  

2005-­‐2009   2006-­‐2010   2007-­‐2011   2008-­‐2012  

UK  Life  Science  Start-­‐ups  

Number of life science companies formed in 5 year period

University Spin-outs

0  

2  

4  

6  

8  

10  

12  

University  Life  Science  Spin-­‐outs  

LS Research Power> 1,000

LS Research Power < 1,000

•  5 of top 10 universities for life science spin-outs are Scottish

•  Correlation between research base and spin-out activity remains

University spin out activity University spin-out activity correlates to quality and volume of research; Spreading funding more thinly and driving academics towards

commercial collaborations reduces quality and volume of fundamental research;

Therefore, current policies will continue to act against spin-out activity;

Investment in Life science start-ups

310  

320  

330  

340  

350  

360  

370  

380  

390  

400  

410  

2005-­‐2009   2006-­‐2010   2007-­‐2011   2008-­‐2012  

UK  Life  Science  Start-­‐up  Investment  

Amount invested in the period in start-ups created during that period

10 companies raised £207M ($330M)

Atlas raised $265 million for its 9th fund, committing to focus on supporting early-stage startups in life sciences and tech. The fund is expected to fuel more than 15 new biotech startups

Investment Pool Growing Welsh Life Science Fund- £50-100M Rock Spring Scottish Fund- £50M IP Group- £30M Fusion IP - £20M Imperial Innovations – £30M Cambridge University- £50M Nottingham Tech Fund - £40M

Structural Investment challenges remain

Ø  Shortage of confident Ø  investors in UK

Ø Lack  of  confidence      >  Dmid  invesDng  

Ø Companies  lack  resources  to  recruit  quality  and  execute  plan  effecDvely  

Ø Companies  fail  to  deliver  Ø Investor  becomes    

 more    cauDous  

IPO window opening; Ø More naïve investors

drawn in; Ø Poor investment

decisions or investment at wrong stage

Ø Pull away

How do we break the cycle?

-Early stage funding = corporate, university/public, philanthropy -longer horizons, strategic investing -continue to build this base

-VC steps in later

The world turned upside down

Large pharma downsizing and moving out –  Small  pharma/bio  moving  in  –  Leveraging  past  spend-­‐  increasing  capital  effficiency  

Opening research doors Pharma getting ever closer to early stage

–  Academic  collaboraDons  –  Venturing  

Impact yet to be felt for start-ups- but opportunities abound