EP Vantage recently completed an analysis of deal-making in the biotech sector comparing 2012 to 2013. Results show that the overall number of deals have declined YoY by 4%. However, the number of Phase II deals (the so-called sweet spot) actually increased by 45% on a YoY basis. Similarly, the amount of upfront payments on ALL deals on a YoY basis declined by 25%. But the Phase II deal value actually increased by 32% ($434 M vs $328 M). The long term deal value actually increased by 15% on a YoY basis, and the corresponding figure for Phase II deals was up 13% ($3201 M vs $2844 M).
This data sems to suggest that the number of 2013 deals is likely to be down overall as well as the upfront payments. But the overall "promised" value of the deals is up and of course payouts depend if all milestones are hit -- which history says is unlikely. See the EP Vantage data.
Posted by Bruce Lehr Aug 15th 2013.