Beyond Borders: Global biotechnology report 2010

Ontario-based firms raised over US$400
million, more than any other province (due
principally to the Biovail financing discussed
above), followed by Quebec firms, which
raised US$161 million. In a surprising show
of strength, Alberta companies raised
US$84 million, while British Columbia’s
firms raised US$67 million.
There was a similar surprise in the cross-city
analysis of capital raised. While Montreal,
Vancouver and Toronto continued to lead
the pack, companies in Calgary raised
US$84 million, third only to Montreal and
Toronto. The increase in funding from
Calgary can be attributed to Oncothyreon
and ResVerlogix, which were both very
active in 2009 and accounted for 56% of the
funding in Calgary.
Australia
In Australia, the amount of capital raised by
publicly traded companies through equity
financings rebounded sharply, from A$119
million (US$106 million) in 2008 to A$307
million (US$229 million) in 2009. While
this represents an encouraging recovery
over the prior year, the amount raised in
2009 is still the second-lowest in any year
since 2002 and is about 40% lower than
the annual average seen between 2005
and 2007. The capital markets remained
closed to biotech companies looking to
issue shares for the first time, and there
were no IPOs of Australian companies
during the year.
As in many markets, the bulk of the
money went to a relatively small group of
companies. Five firms — Avexa, Bionomics,
Pharmaxis, QRxPharma and Starpharma
Holdings Limited — accounted for more
than half the public equity capital raised
during the year. Melbourne-based Avexa
led the financing totals for the year, with
A$41 million (US$31 million) raised in
Australian biotech public equity raised, 2002–09
IPO
A$m
700
600
500
400
300
200
100
0
2002 2003 2004 2005 2006 2007 2008 2009
Source: Ernst & Young, Bioshares and company annual reports
several different offerings. Following the
failed merger with Progen in early 2009,
Avexa turned to its shareholders and
raised A$17 million (US$12.7 million)
in a rights issue followed by an A$11
million (US$8.2 million) private placement
and a A$15 million (US$11.2 million)
oversubscribed shareholder purchase
plan. These funds were utilized to advance
the company’s apricitabine (ATC) Phase III
study in HIV patients. The A$15.6 million
(US$11.6 million) raised by Starpharma
through a private placement to
institutional and sophisticated individual
investors is to be used to finance the
completion of Phase III clinical trials.
Other markets
Follow-on offerings
For noteworthy financing events in
other markets, refer to the Country
profiles section.
Number of transactions
Getting creative
Challenging times have typically inspired
creativity in biotech companies, so it is not
surprising that companies have shown an
increased interest in other sources of capital
as the usual funding sources have become
increasingly constrained. This has ranged
from using asset sales and alliances to raise
capital to exploring funding options from
disease foundations and government grants.
Economic development incentive programs
(see A closer look on the next page) provide
another potential source of capital, as state
and local governments — pressures on their
own coffers notwithstanding — are often still
interested in developing their local
biotech clusters.
Looking ahead
The amount of investment capital available
for the biotech industry will depend on
the pace of economic recovery in the
73
70
60
50
40
30
20
10
0