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June 02, 2024 | Tom Ballard

Private biotech venture financing records 46 percent increase in deal value in Q1

That follows the two previous years when financing experienced a downturn in investment driven by macroeconomic challenges.

Private biotech venture financing saw a 46 percent increase in total deal value in the first quarter of 2024 compared to Q4 of 2023, according to GlobalData’s Pharma Intelligence Center Deals Database.

According to this article in Pharmaceutical Technology, this signals progress towards recovery in venture financing as investor confidence improves. In 2022 and 2023, private biotech venture financing experienced a downturn in investment driven by macroeconomic challenges. High interest rates and inflation contributed to investors becoming more cautious in biotech venture financing.

However, in 2024 investor optimism has increased due to the expected lowering of interest rates as inflation slows, which in turn would reduce the cost of capital. Therefore, an increase in venture capital investment in private biotech companies is expected to continue.

Private biotech venture financing deals in Q1 of 2024 were marked with an increase in larger funding rounds compared to Q4 of 2023. This reflects the improved venture capital sentiment away from previously being more selective in favoring smaller funding rounds to investing more in larger funding rounds.

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