CAPTION: Financing of the German biotech sector collapses after coronavirus boom. (picture alliance/dpa/Sebastian Gollnow)
Following a boom during the coronavirus pandemic, the German biotech industry is again experiencing more difficult times. After two years of record financing, less money flowed into companies in the sector in 2022, while the sentiment in the industry has darkened. This was announced by the industry association BIO Deutschland in Berlin. In the latest member survey, only 26 percent expected their business situation to improve, about half of the 2021 figure. "In addition to war, the energy crisis, and inflation, a shortage of skilled workers and a lack of financing options are slowing down our companies," said Oliver Schacht, CEO of BIO Deutschland.
Last year, he said, biotech companies raised about 920 million euros in equity via venture capitalists, IPOs, and capital increases on the stock market. That was less than a third of the record set in the first year of the pandemic, 2020, he said. "In terms of financing, the industry has fallen to pre-pandemic levels," Schacht said. With tech company stocks plummeting, it has also become harder for companies to get money from investors, he said.
During the pandemic, the biotech industry had boomed with beacons such as Mainz-based vaccine maker BioNTech. In 2020, the industry, which employs nearly 45,000 people in Germany, raised about 3.1 billion euros, and in 2021, about 2.4 billion euros.
Biotech companies experiment with complex active ingredients and therapies, and also develop technologies for the chemicals industry and agriculture. This is expensive and takes a long time, which is why biotech companies rely on a lot of money from investors, most of whom are based in the United States. Companies like BioNTech were drawn to the US technology exchange Nasdaq to go public.
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