Life Sciences + Healthcare, Technology Transactions, and Emerging Companies + Venture Capital
PALO ALTO, Calif. – December 12, 2012 – Analyzing more than 1,000 biotechnology transactions between 2006 and 2012, Morrison & Foerster found the average up-front payment in licensing, collaboration, and development agreements was $35.5 million for all stages of development. But in the first quarter of 2012 the biotech market saw significant increases in the percentage of transactions involving approved products, with a corresponding increase in average upfront payment values—$90 million across 13 transactions—compared to prior years.
The increase is consistent with anecdotal observations that licensees have generally become more interested in later-stage assets to fill their drug development pipelines, according to MoFo BioMeter, a newly launched quarterly publication that indexes average up-front payments in licensing, collaboration, and development agreements between biotechnology companies and companies that pay for commercialization rights.
“BioMeter seeks to analyze trends in the value of development stage assets,” Stephen Thau, a corporate and life sciences partner in the firm’s Palo Alto office and editor of the newsletter, said. “Up-front payments are a particularly important component of that value. Our deep understanding of the industry allows us to keep a finger on the pulse of life sciences transactions across many sectors—biologicals, small molecules, and other therapeutics, as well as devices—and offer cogent insight on the deal-making and financing environment.”
The inaugural issue of MoFo BioMeter is available here: //media2.mofo.com/documents/121211-mofo-biometer.pdf.
Mr. Thau noted that as venture funding for unapproved life sciences products has declined, income derived as a result of collaborations and other transactions has become increasingly important to smaller biotech companies—making a focused look at payment trends especially valuable to executives, attorneys, investors, and others making financial decisions within the industry.
“We hope that readers will find MoFo BioMeter a useful tool in keeping up to date with industry deal-making trends,” Mr. Thau said.
Additional findings from the BioMeter include:
MoFo BioMeter is researched and written by Morrison & Foerster attorneys from a range of practice areas, including Life Sciences, Technology Transactions, Emerging Companies and Corporate out of the firm’s offices in the U.S., Europe, Japan, and China. Globally, MoFo’s life sciences clients include more than 600 companies and research institutions and the venture capital and investment firms that finance them. The publication follows the launch of other successful online newsletters produced by MoFo covering technology (MoFo Tech) and social media (Socially Aware).
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