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Market Map: Biopharma’s gene therapy pivot

Biopharma is a sector undergoing significant change as investment strategies refocus amidst market challenges, regulatory oversight and scientific advances.

Biopharma is a sector undergoing significant change as investment strategies refocus amidst market challenges, regulatory oversight and scientific advances.

Investors are reprioritizing from traditional areas such as small molecules and biologics to gene therapy in the hope of tackling genetic conditions and diseases, according to PitchBook’s inaugural biopharma report. Earlier this month, the Food and Drug Administration approved the first gene therapies for sickle cell disease in a breakthrough for gene editing technology.

The market map below explores the gene therapy segment and shows which startups are attracting capital. Click on the teal tile to see more information.

 
To go deeper, read our Q3 2023 Biopharma Report. PitchBook customers can also explore the full market map with details on thousands of companies by investigating through the lens of drug modality or therapeutic area.

Spotlight: Gene Therapy

The gene therapy segment is made of four subsegments:
 
  • Gene delivery: Ways to deliver treated genes into a patient.
  • Gene editor: Technology that directly edits the DNA in a patient's cells.
  • mRNA therapy: Therapies that deliver RNA molecules to use the patient's own body as a medicine producer.
  • Oligos/RNA therapy: RNA therapies to turn off genes that might cause disease.

Trends: Deals and exits

 

Through the first three quarters of 2023, there were 634 biopharma VC deals worth $18.5 billion, according to PitchBook data. While the total amount of capital raised has increased quarter over quarter in 2023, there was a notable decrease from the peaks seen in 2021.

The number of individual deals has also declined on a quarterly basis this year due to a strategic shift emphasizing fewer but larger deals, according to the report.

Notable deals in Q3 included integrated genetic medicines company ReCode Therapeutics' $260 million Series B extension at a $700 million valuation, and AI drug designer Genesis Therapeutics' $200 million Series B at a $424 million valuation, according to PitchBook data.
 
 

A more bearish IPO market and an investment climate that seems to be reverting back to its pre-pandemic norm caused the number of exits to drop significantly from 2020. So far in 2023, there have been 64 exits worth $13.8 billion.

Notable exits in Q3 included brain disease drugmaker Neumora's IPO, which raised $250 million at a valuation of $2.5 billion, and cancer drug developer Adlai Nortye's $57.5 million IPO at a valuation of $922.5 million.

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Featured image by Tek Image/Getty Images

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