Biotech industry: financing stable - trend reversal on the horizon

533 million euros of this went to private companies in the form of venture capital, 547 million euros flowed to listed companies as capital increases, according to the data survey published today by the biotechnology industry association BIO Deutschland. The association's annual trend survey also shows that although business managers still rate their business situation significantly worse in 2023 than in 2022, they are more positive about the future again. However, the negative trend in personnel planning and investment in research and development (R&D) will continue in the coming year.

Around 29 per cent of respondents stated that their current business situation was poor. In 2022, only 13 per cent said this. In contrast, around 35 per cent expect their business situation to be better in 2024 than in 2023, compared to just 26 per cent last year. The number of companies that will reduce their workforce has also increased. 14.5 per cent plan to do so, around three times as many as a year ago. The number of those planning to increase staff has remained stable at around 45 per cent. 33 per cent plan to invest more in R&D in 2024 (2023: 39 per cent), while 18 per cent plan to reduce this investment (2023: 11 per cent). The number of those who think the current political climate is bad for biotech companies has more than doubled, from 15 to 35 per cent. As far as the future political climate is concerned, entrepreneurs hardly expect any changes.

Oliver Schacht, Chairman of the Board of BIO Deutschland, states: „The year 2023 presented our companies with particular challenges. The capital market was difficult, energy costs are high and qualified staff are hard to find. The results of our trend survey reflect this situation. It is noteworthy that many managing directors assume that the situation will not deteriorate further and that there are even signs of a trend reversal. However, they are still cautious when it comes to investments, and more job cuts are also planned, albeit still at a low level.

Viola Bronsema, Managing Director of BIO Deutschland, adds. „The trend survey shows that the assessment of the political climate for our industry has once again deteriorated significantly compared to the previous year. This is understandable, because biotechnology has still not become a top priority for our government, even though the Chancellor's Council for the Future, for example, has recognised the importance of the technology. Something urgently needs to happen here. Biotech companies are powerhouses of the value chain, therapy development and the sustainable bioeconomy as well as the circular economy.

Press release from "Bio Deutschland" dated 11 January 2024