Foreword
In this report, we’ve rounded up the final quarter of 2023, looking at the IPOs, M&A activity and venture financing to investigate the state of the market and the potential glimmers of hope for 2024.
With the IPO window remaining stubbornly stuck for most of the past couple of years, many investors have found themselves holding on to their portfolio clients for longer than planned. This limited the opportunity to redeploy their capital and fund the next generation of bright young things in biotech. Did that IPO window finally creak open towards the end of the year? Well, it certainly didn’t swing wide, but then Q4 is rarely a great quarter for biotech flotations. However, the few that did get away have fared better than most of the rest of the class of 2023.
The impact of the dearth of IPOs could certainly be see in venture capital fundraising, which saw a dip in the final quarter of the year from an already pretty low $4.3bn in Q3. Still, the drop wasn’t huge and, coupled with the falling of interest rates, the stage might be set for a more positive 2024.
Some of the hope will be pinned on a pick-up in M&A activity. This is perhaps the area where the outlook is most promising. After a disappointing Q3, there was a significant bounce back in the final quarter. Nearly 40 deals took place, with 10 of them valued at over a billion dollars. At the risk of going off-brief and looking at 2024, we’ve seen more significant deals in the first few weeks of the year, leaving many in the market with something of a spring in their step.
It’s too early to forecast a great biotech revival in 2024, and any recovery with be hard won. In this report, we round up the good, the bad and the ugly (there’s plenty of the latter) of 2023, and hope that we may never have to speak of it again. Let’s get started.
