Biopharmaceutical Sector Update:
Executive Summary

Evolving Financing and Deal Environment

October 5, 2021

In this report, we examine the financing and deal environment for the biopharma sector, with consideration of the ongoing COVID-19 pandemic. In preparing this report, we have analyzed data in the public and private financing markets and have also looked at the M&A market, with commentary on notable transactions.

Key points:

  • A good news week for COVID-19. New case volume continues to drop at the same time that Merck and Ridgeback reported remarkable data for an oral antiviral to treat the disease.
  • Efforts to advance drug price reform in the U.S. Congress appear to have been stymied. The Democrats are struggling to get a larger social spending bill through and may need to restructure the bill.
  • A panel being held on Wednesday, October 6 during BioFuture is well worth listening into on the drug price reform topic. (see
  • The Nasdaq Biotech Index fell 5.6% last week, the largest drop in many months.
  • Conversations with market participants indicate that generalist investors are exiting the biopharma markets as the pandemic subsides.
  • Macro news is not great. The 10-year Treasury bond yield has crept up 28 basis points in a month and historically tight credit spreads have reversed.
  • The value of the life sciences sector has dropped a full half trillion dollars in several months, closing Friday with a total value under $8 trillion.
  • The sector lost $240 billion last week alone, led by weakness in life science tools.
  • The rout in life science tools stocks was broad with over 85% of players seeing a decline in value last week.
  • The IPO market in September was the lightest we have seen since the pandemic began.
  • The venture privates / crossover equity market also weakened significantly last week—for the first time in months.
  • Q3 private debt volume was robust and stronger than volume in the first two quarters of 2021.
  • M&A has picked up nicely in September, highlighted by Merck’s announced acquisition of Acceleron.
  • September has seen three big pharma deals announce—the most since the pandemic began.

Please contact Torreya if you have any questions or comments:

Tim Opler  |  Partner, New York  |  |  bio
Stephanie Léouzon  |  Partner, London  |  |  bio

Data sources: S&P Capital IQ, Crunchbase, press releases and Torreya Calculations