Strong Fundraising and Innovation
Fuels Healthcare Momentum
SANTA CLARA, CA – January 5, 2017 -- Silicon
Valley Bank (SVB), the bank of the world’s most innovative companies and their
investors, today released its annual Healthcare Investments and Exits
2017 report, which
discusses the top trends in 2016 within the biopharma, device, tools and
diagnostics sectors and provides an outlook for 2017. The report delves into
venture investing, fundraising trends and exits.
overall exits declined in 2016, we expect to see a significant number of
M&A transactions and a continued IPO window in line with recent activity as
we enter the new year,” said Jon Norris, Managing Director for Silicon Valley
Bank’s Healthcare Division. “Robust investor fundraising activity
in the past year also highlights the health of the market, and we believe the
healthcare sector remains vibrant as it enters 2017.”
- Series A activity boomed in the biopharma, device, diagnostic and
tool sectors, most dramatically in biopharma due to newly raised venture funds
and early-stage exits.
- Following an exceptionally strong 2015, biopharma M&A activity
declined slightly in 2016, and IPOs declined more than 30 percent.
- For a third year in a row, pre-clinical or phase
I companies represented almost half of all biopharma IPOs. Crossover
investors were a significant part of this trend.
- Device M&A remained stable, but IPOs were down. Diagnostic and
tool companies saw a decline in overall exits.
- The slower 2016 IPO market led to lower potential distributions to
healthcare investors, off from a record year in 2015, but still above 2013.
“In 2017, healthcare investments will closely match 2016
levels, with biopharma continuing to be the strongest sector in the space,”
Norris said. “Following a
slow 2016 for device IPOs, we expect the number to double this year. Device
M&A activity likely will be stable and include some early-stage
- Biopharma will continue as the
strongest sector for healthcare investments in 2017.
- SVB expects the IPO window to
remain open in 2017, anticipating 28-32 biopharma deals to occur.
- At least half of the biopharma
M&A big exits will be for early-stage companies, with the total number
likely between 18-22.
- SVB predicts Series A investment will remain stable
for the device and diagnostic and tool sectors. We do anticipate a slight drop
in biopharma Series A as funds turn their attention to supporting Series B and
later stage companies that are unable to go public. Potential distributions
to healthcare venture capital investors are anticipated to remain at similar
levels as 2016.
Life Science and Healthcare Division of Silicon Valley Bank delivers
specialized solutions and market expertise in the areas of biopharma, medical device, tools
and diagnostics, digital health and healthcare services, with a focus on
helping companies of all sizes grow.
Read the full Healthcare Investments and Exits
2017 report here: https://www.svb.com/healthcare-investments-exits-report/
About Silicon Valley Bank
than 30 years, Silicon Valley Bank (SVB) has helped innovative companies and
their investors move bold ideas forward, fast. SVB provides targeted financial
services and expertise through its offices in innovation centers around the
world. With commercial, international and private banking services, SVB helps
address the unique needs of innovators. Learn more at svb.com.
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