New data released at second Future of Healthcare Investor Forum, hosted by MedCity and the London Stock Exchange, highlights continued strong performance of life sciences
• FTSE All Share Healthcare and FTSE AIM All Share Healthcare outperformed the general FTSE indices in 2015, continuing a long term trend of outperformance over the five years to the end of 2015 of 37.7% and 62.8% vs FTSE All Share Index respectively
• £1.26bn raised on public markets in life sciences in 2015, slightly ahead of 2014, itself the best year in a decade
• Separately almost £1bn raised in life science IP commercialisation related IPOs in 2015
• 2015 was the highest year for UK private fundraising in the life science sector for a decade
• Speakers highlight strong sector fundamentals, quality of UK science and supportive environment
The Future of Healthcare Investor Forum, the London-based life science investor event, will today bring together speakers from finance, the UK life science industry, government and public and private companies to highlight the continued strength of the investment opportunity in the sector. Hosted by London Stock Exchange and MedCity, the one-day conference aims to provide both generalist and specialist investors with insights into trends shaping the industry and an outlook into the investment climate.
The event, now in its second year and sponsored by J.P. Morgan, Numis and Consilium Strategic Communications, held in partnership with the BioIndustry Association (BIA) and One Nucleus, will highlight the significant investment opportunities available to investors within the UK healthcare sector. It will comprise a series of panel sessions on key themes driving investment opportunities in healthcare, company presentations and keynote addresses from key industry stakeholders. In addition, investors will also have the opportunity to book 1-to-1 meetings with presenting or participating companies at the venue.
The UK-listed healthcare sector continues to be a source of outperformance for investors. The FTSE All Share Healthcare and AIM All Share Healthcare Indices have increased by 50.2% and 75.2% over the five years to the end of 2015, versus a price return of 5.8% and 12.5% respectively for the FTSE100 and FTSE All Share. In 2015 the two healthcare indices again outperformed the general UK indices, with a 26.4% gain for the AIM healthcare index outstripping even the NASDAQ Biotechnology’s increase of 11.4%.
In 2015 the UK public markets demonstrated continued fundraising strength and life science equity capital raising was slightly higher, at £1.26 billion compared to just over £1.2 billion in 2014, itself the best year in the past decade. Follow-on capital raising was particularly strong, with £1.1bn raised compared to £0.8bn in 2014. Additionally, more than 60% of the life science companies that floated in 2014 have already raised follow-on capital, pointing to the support investors are giving to sector companies post listing.
In addition, Woodford Patient Capital Trust, which has a strong focus on backing companies involved in the commercialisation of the UK’s world leading healthcare research and IP, raised £800m in its IPO, four times the original target.
During 2015 London established itself as the global hub for life science IP/commercialisation related IPOs, attracting Boston-based PureTech Health, which raised £124 million. Following on from the 2014 UK IPO of Allied Minds, raising £124 million, this listing demonstrates that investors increasingly regard the UK as the premier destination for companies seeking to commercialise promising life sciences IP.
The UK continued to attract other US based life sciences companies to its public markets during 2015, including California-based Verseon, which raised £66 million.
2015 also saw the highest total amount of private investment into UK life science companies for a decade, according to data from Evaluate Pharma, with $708 million invested privately, compared with $498 million in 2014, itself a record.
Boris Johnson, Mayor of London, said: “London has proven itself to be an unbeatable place for life science innovation and I am delighted that it is also growing a strong reputation as a place for life sciences fundraising and investment. Our message is clear – if you want to find the most exciting companies offering the best investment opportunities, London is the place to look.”
Life Sciences Minister George Freeman MP said: “Since the Prime Minister and I launched the UK Life Sciences Strategy we have attracted over £6 billion of inward investment to the UK, creating up to 17,000 jobs. With UK early stage companies raising a record £1.3bn last year, it’s clear that the UK is again a global life science powerhouse, and the City of London is a financing hub growing the companies of tomorrow. We have some world class emerging companies in the UK which could be the Apple of healthcare, and we want to grow and finance them here.”
Dr Eliot Forster, Executive Chair of MedCity said: “The UK is home to an enormous reservoir of scientific excellence, particularly in the London-Oxford-Cambridge golden triangle, and that presents investors with a host of world class opportunities. It’s extremely gratifying to see the region establishing itself as a scientific investment hub, with areas including IP commercialisation particularly strong, helping us to make this case. We look forward to a day of stimulating debate and discussion on how to continue to strengthen the attractiveness of this region.”
Xavier Rolet, Chief Executive of the London Stock Exchange Group, said: “The UK is blessed with all of the conditions for ambitious pharma and biotech companies to thrive – world leading academic and scientific research institutions, an engaged venture capital community and an international investor base that is attracted to invest in companies on London’s market. Today’s extraordinary event, backed by strong government support, is proof that Britain now stands at the forefront of innovation in this vital industry.”
Cathrin Petty, Head of EMEA Healthcare Investment Banking at J.P. Morgan said: “The UK’s scientific excellence has never been in question, but the past few years have demonstrated that significant strengthening in clinical development infrastructure and management, coupled with growing confidence among the investor community, are helping to convert this excellence into a compelling investment proposition, strengthening the UK’s appeal as an attractive and resilient destination for a broad range of life sciences companies.”
Michael Meade, Managing Director, Broking and Advisory, Numis, said: “Investor appetite for UK life sciences companies has remained strong throughout 2015, both on the Main Market and particularly on AIM, which has outperformed more broad-based and other specialised healthcare indexes. We are delighted with this performance, which demonstrates that the UK has become a sustainable hub for life science investment.”
Amber Fennell, Partner, Consilium Strategic Communications, said: “During 2015 we have seen life science companies from the UK demonstrating the ability to convert world class science into a sustainable investment proposition. We are delighted to be supporting the second Future of Healthcare Investor Forum and look forward to an event where the key thought leaders in this field will share their insights into how to continue this momentum.”
Steve Bates, CEO of the UK BioIndustry Association (BIA), said: “The improving financial climate in London is enabling the UK innovation ecosystem to become the third global cluster for bioscience, behind US heavyweights Massachusetts and California. Our overview document, published today, demonstrates the strength of the pipeline across the UK. On this and other key indicators for the sector, the UK is already the clear leader in Europe.”
Harriet Fear, CEO of One Nucleus, said: “Here at One Nucleus we are delighted to be involved in the planning and delivery of this important conference. At the inaugural event in January 2015, George Freeman MP, our Minister for Life Sciences, made it very clear that he welcomed the day and encouraged all of us involved in it to make it happen again in 2016. I very much look forward to meeting with the great range and depth of guests who will be taking part.”