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Big Pharma Outbids Public Investors: Step-Ups in Biopharma Exits

 
• By Kevin Roche

Biotechs exiting via selling out to Big Pharma have been averaging far higher multiples than those exiting via IPO.

Lately, it seems the only private biopharma investors with much to cheer about are those whose concerns have been targeted for acquisition by Big Pharma: Merck & Co. Inc. paid $480 million in May to acquire GlycoFi Inc. and Abmaxis Inc. at an average of 10 times what private investors had paid in [See Deal][See Deal], while, in April, Pfizer Inc. paid a similar multiple to acquire Rinat Neuroscience Corp. : $500 million, for a firm that had raised $57.5 million in its history. [See Deal]While multiples of acquired biotechs have been significantly higher than those of biotechs exiting via IPO, average valuations haven’t been. In Exhibit 1 below, we compared average valuations and multiples of private biopharma exits by type of exit:

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• By Jung Won Shin, Lisa Takagi, Joseph Haas, Anju Ghangurde, and Vibha Ravi

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• By Joseph Haas

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• By Edwin Elmhirst

Evaluate's top five unpartnered clinical oncology assets reveals you have to get in early to snap up innovation in the competitive cancer space.