Posted by: Audrey Erbes | August 6, 2010

Investments in Early Stage Life Science Companies Up in Q2

PriceWatershouseCoopers had some really good news about sharp upturn in VC investments in the life sciences in quarter two 2010 vs. quarter one as well as the first half 2010 vs. that for 2009 in a press release issued yesterday. “Life Sciences funding for Q2 2010 totalled $2.1 billion in 234 deals, which represents an increase of 52 percent in dollars and a 36 percent increase in deals from the prior quarter, reversing the performance seen in the first quarter of 2010 when sector investment dropped 27 percent in dollars and 15 percent in deals from Q4 2009.”

A full copy of the report is available for free at http://www.pwc.com/us/lifesciencesmoneytree.

Life Sciences investments reached $3.4 billion, a 26 percent increase from the first half of 2009 and deals rose 18 percent to 406 in the first half of 2010 from 345 for same period in 2009. The sector split in the second quarter of 2010 remained consistent with previous years with biotechnology accounting for 63 percent of dollars with $1.3 billion going into 139 deals, while medical devices fetched 37 percent of dollars with $755 million invested in 95 deals.

After a drought in early stage investments holding Bay Area industry hostage since late 2008, there seems to be a positive change underway.  If it holds up, the upturn should portent far more new jobs than we’ve been seeing in this slow economic recovery nationwide. Early stage investing in Q2 saw a significant jump, rising to $751 million. That’s an 83 percent jump from the prior quarter and a 33 percent increase compared to the second quarter of 2009.

Early stage investments in the biotechnology sector showed a 68 percent increase in the number of deals and a 55 percent jump in dollars invested in the second quarter vs. Q1 2010. But the medical device industry trend wasn’t as dramatic with regard to funding of early stage deals–one-third of the dollars in the Q2 went to later stage companies, while 34 percent of the deals were early stage companies.

So let’s look at the Jobs that Crossed My Desk since my last report through today as well as those from the previous three weeks since July 12th.

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