European private equity investment in biotech has been on a downward trajectory since its pandemic-era peak, and now a tougher economic backdrop is bringing investment in 2024 to a projected five-year low.
So far this year, PE firms have invested just €300 million (around $334.5 million) into European biotech, not even half the investment of 2023 and considerably lower than the average annual deal total of €1.6 billion between 2020 and 2022, according to PitchBook data.
This year’s deal value is also considerably lower than the year before the pandemic when PE firms invested €1 billion into European biotech.
The number of deals has also been dropping. At the height of the pandemic in 2020 and 2021, there were 27 and 35 deals, respectively. There have been just 11 deals this year so far.
The largest deal recorded in the last five years goes back to 2020’s €550 million buyout of gene and cell therapy technologies developer Polyplus, by ArchiMed and Warburg Pincus.
The downward trend of biotech investment follows a broader drop in interest in the healthcare sector.
PE investment in healthcare this year is also set for a five-year low. Healthcare spending peaked in Europe in 2022, when €50.7 billion was invested across 692 deals.
Since then investment activity has dropped to 472 deals worth just over €34 billion in 2023 and is now sitting at €20.5 billion across 342 deals.
Woman examining laboratory samples
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