svb+醫(yī)療保健行業(yè)投資和退出：2023年年中更新-Healthcare Investments and Exits

Mid-Year2023Update

Biopharma|Healthtech|Dx/Tools|Device

HEALTHCAREINVESTMENTSANDEXITS|MID-YEAR2023UPDATE2

SiliconValleyBank

Diamondsformedunderpressure

WearepleasedtobringyoutheHealthcareInvestmentsandExitsMid-Year2023Update,acomprehensiveanalysisofthe

trends,opportunitiesandchallengesintoday’shealthcareinnovationmarket.

Webegan2023withacautiousoutlook,andthere’snodisputingthatthefirsthalfoftheyearhasbeendifficultfor

stakeholdersacrosstheinnovationeconomy.However,alothaschangedsincethestartoftheyear.Publicmarketsshow

earlysignsofimprovement,inflationisdecelerating,interestratesmaybeneartheirapexandthegeneralpullbackin

investmenthasstabilized.

Still,thecurrentinvestmentenvironmentpresentsongoingchallenges,markedbyfewerdeals,slowerinvestmentpaceand

pressuredvaluations.Thetimehaslikelycomeforcompaniespreviouslyavoidingdownroundsthroughinsiderextensionsto

seriouslyconsidervaluationresets.Companiesalsofacemoreinvestorscrutinyandareworkingagainstheighteneddemand

forclinicalmilestones(page9)andpathstoprofitability.

Despitethesechallenges,therearereasonsforoptimism.Weseesignsofgrowthattheearlystagewhereinvestmenthas

beenbuoyedbystronginterestfrominvestors(page11).Therearepromisingbrightspotsininvestment,suchaswomen’s

healthexpandingintoplatform,menopauseandmentalhealthcare(page18),genomicdiagnosticssolutions(page12),and

deviceswithrobustdigitalplatformsthatincreasetheefficiencyofprovidercareteams(page13).

Thenewinvestmentenvironmenthasresetvaluationstomatchsustainablegrowthandprofitabilitytargetsin2023.This

adjustment,whilepainfulformany,willleadtoamoresustainablefuture.Venturefundraisinghasreboundedsinceitsdipin

H2’22,andamplecapitalremainsforright-sizedinvestmentintothehealthcareinnovationeconomy.Whilethenear-term

outlookappearsuncharted,ourbeliefintheresilienceoftheinnovationeconomyremainsunwavering.

KaleFrank

ManagingDirector,

Biopharma,Dx/Tools,SiliconValleyBank

JackieSpencer

HeadofRelationship

ManagementforLifeScienceandHealthcareBanking,

RaysaBousleiman

SeniorAssociate,

HealthcareInsights,

SiliconValleyBank

HEALTHCAREINVESTMENTSANDEXITS|MID-YEAR2023UPDATE3

Healthcaremarkethighlights

Healthcarefundraisingandinvestments

Sectortowatch:women’shealth

HealthcareM&AandIPOactivity

Authors

Glossary

Newprivateinvestmentlandscapemarkedbyvaluationcorrections,slowerinvestmentpaceandsmallerchecksizes;IPOwindowlargelyclosedbutacquirersactiveonselectivebasisinH1’23

Biopharma

Early-stageinvestmentjumpedthisyearbutatmassivelyresetvaluations.Focusisincreasinglyoncompaniesledbyveteranmanagementteamswithin-humanproof-of-concept/provenmodalitieswithcompellingstoriesat“2023marketprices”andrealisticexitprospectsthatdonotrelyupontheIPOwindowopeninginthenext12-18months.Atthelaterstage,pre-IPOroundshitsingle-digitpaceperquarterasinvestorsaremoreselectiveandpublicmarketsperformancebybiotechsremainsmixedbutlargelynegative.Promisingly,2023-vintagebiopharmaIPOsareperformingwellwithsixofeighttradinginpositiveterritory.TheIPOwindowshowsearlysignsofopening,withthreebiopharmaIPOspricedinJuly2023raising$465Mcombined.

Healthtech

InvestmentkickedoffrelativelystronginQ1,especiallyforseed/SeriesAcompanies.However,dollarsslowedsignificantlyfromQ1toQ2’23.Seed/SeriesAinvestmentslowed63%,andoverallinvestmentslowed39%.Weareontracktohit2019investmentpacesifthisinvestmentpacecontinuesintoH2’23.Atthelaterstages,weareseeingfewermega-deals,withmedianchecksizesdroppingsubstantially.Themarketdownturnhasputpressureoncompaniestoaddvalueincriticalplaceswherereimbursementisattainableinthenear-term.IthasalsoputpressureonD2Cmodelstoturntoenterprisetoscale.Demandforprovenvalue-basedcaremodelsandchronicconditionmanagementremainshigh.Thepublicmarketsremainclosed,withzeroIPOsinH1’23.PrivateM&Aactivityremainsstrong,butacquisitionpricesaredownasacquirersstrugglewithvaluationdisconnectatthelaterstage.WeanticipatethathealthtechcompanieswillcontinuetodelayIPOplansuntilatleastlate2023.

Fundraising

FundraisingreboundedafterarelativelyslowH2’22,hitting$6.8B

inQ1’23and$6.9BinQ2’23.Thisuptickisdrivenbyexpectations

forloweringFederalReserveinterestrates,aresettingof

valuationsandveryearlysignsofareboundingstockmarket

(mostlyinthetechandhealthtechsectors).TheIPOwindow

remainslargelyclosed,tyinguplimitedpartner(LP)capitalin

late-stagecompaniesandlimitingreturndistributions.

Consequently,moreinvestorsslowedlate-stagefundraising.

SeventyfundsclosedinH1’23,signalingthatoverallinterestin

healthcareinvestmentremainsstrong.Thereisstillan

unprecedentedamountofhealthcare-dedicatedventurecapital

(VC)tobedeployedtotopcompaniesatrational,investor-driven

valuations.

Investments

Afteramajordropin2022,investmentdollarsandpacehave

remainedrelativelyflatforthelastthreequarters,signalingthe

dawnofanewmarketcyclemarkedbycorrectedvaluations

(focusedonfundamentalslikeclinicalassetsandpathstocash

flowoperations),smallerchecksizesandmoreconcentrated

cohortsofinvestors.Thereisamajorincreaseininsider-led

bridgeroundsascompaniescontinuetofacedifficultyattracting

newinvestorsandavoid“valuationhaircuts”thatcomewith

bringinginnewcapital.Anecdotalevidenceindicates

thatawaveofdownroundsand“structured”termsheetshave

cometomarketalongsidecontinuedcost-savingmeasures.

Whilethisshifthasbeenapainfulreset,themarketright-sizing

canleadtoamoresustainablefuture.Amplecapitalremainsfor

right-sizedinvestmentintothehealthcareinnovationeconomy,

albeitonamorediligentbasis.

Source:PitchBook,S&PCapitalIQandSVBproprietarydata.

Dx/Tools

InvestmentinH1’23matchedthatofH2’22forSeriesAandlate-stageinvestments,drivenmostlybyQ1’23activity.TherewerezeroIPOsinH1’23,markingthefirstyearsince2018withnoIPOsinthefirsthalf.Publicmarketsremainclosedfornewentrants,andallindictorspointtowardahigherbarforIPOhopefuls,bothintermsofrevenuerunrateandabilitytogeneratecashflow.Investorsaredrivingarotationinstrategy:tradinghigh-costrevenuegrowthforlineofsighttocash-flowpositiveoperations.WeexpectIPOstocontinuetobemutedin2023asthemarketwatchesforareboundinperformancefor2020and2021IPOcohorts(33of38aretradingnegatively).Privatecompanieswithunicornvaluationswilllikelyneedtowaituntil2024forbigM&Aexits.

Device

InvestmentinH1’23isdown8%fromH2’22,butearly-stageinvestmentisup44%andremainsabrightspotforinvestmentactivity.Therearefewer$100M+dealsin2023asmanytopcompaniesraisedroundsin2022,anditisuncertainhowmanylater-stageopportunisticdeviceinvestorswillcontinuetobeactive.Devicecompaniesarehithardbysupply-chainissuesandthedeclineinelectiveprocedures.Companiesareworkingtoenableprofitablelong-termgrowthwhileachievingnecessarynear-termcostsavings.We’veseenmoreinvestmentdollarspouredintoremotemonitoring,at-homecareandearlydetectionasdemandtoreducemedicalcostsandkeeppatientsoutofhigh-cost,acute-caresettingsgrows.TheIPOwindowremainslargelyclosed,withtwoChina-basedIPOsinH1’23butzeroUS-basedIPOs.M&Aremainsmuted,butwecontinuetoseespinoutsfrombigdeviceplayerslikeMedtronic,whichcreatesmoreacquirersdowntheroad.

HEALTHCAREINVESTMENTSANDEXITS|MID-YEAR2023UPDATE4

HEALTHCAREINVESTMENTSANDEXITS|MID-YEAR2023UPDATE5

US,EUandUK

Mid-Year

2023

2

$13.7B

2

AfterarelativelyslowH2’22,investorfundraisingacceleratedto$6.8BinQ1’23andheldsteadyat$6.9BinQ2’23.Ifthispaceweremaintained,2023’slife-science-focusedfundraisingwouldnear2021’srecordpace.Thisuptickcomes

amidexpectationsforamoredovishFed(withapauseattheJunemeeting),anearwholesaleresettingofvaluationexpectationsintheprivatemarket,andearlysignsofareboundingstockmarket.Savvyinvestorsknowtheseconditionsbringopportunity.

However,2021sawdebutsbyopportunityfundsandnewmanagers,whereas2023activityislargelyfocusedonveteranmanagers.Asthiscadrefinishesbuildingcapital,thepaceoffundraisingcouldslowifemergingfundmanagerscan’twinLPs’confidence.

TheIPOwindowisstilllargelyclosed,publicvaluationsareunderpressureandlate-stageinvestorsarefocusedonshoringupexistinginvestmentsandbargainshoppingpublicnames.Consequently,capitalremainstiedupinmid-andlate-stageprivatecompanieswithuncertainexitopportunities.Thebiggestchangewe’veseenisincreasedwillingnessbybothfoundersandinvestorsto“findadeal”tomoveassetsforward.Thisunstickingshoulddriveincreasedactivityandopportunitiesforallparties.

VCsremainwell-positionedtofundnewhealthcare

companieswithmorethan$35Braised

inthelast18months.

USHealthcareVentureCapitalFundraising1

2012-H12023

$28.3B

$21.8B

$16.8B

$10.7B

$9.1B

$7.2B

$6.1B

$3.6B

$9.6B

$7.5B

$3.9B

201220132014201520162017201820192020202120222023

NotableFundswithAllocationstoHealthcare3

Notes:1)USHealthcareVentureCapitalFundraisingdefinedasanapproximationofhealthcareinvestment

dollarstobeinvestedbyfirmsthathistoricallyinvestin+50%UScompanies.2)Estimatesbasedon

anecdotalconversationswithinvestorsandexpertanalysisoflastfunddealpaceandfocusonhealthtech.

3)Notablefundsbasedonlargestestimatedallocationtoventurehealthcare.

HEALTHCAREINVESTMENTSANDEXITS|MID-YEAR2023UPDATE6

Source:PitchBookandSVBproprietarydata.

Allnon-SVBnamedcompaniesareindependentthirdpartiesandarenotaffiliatedwithSiliconValleyBank,

adivisionofFirst-CitizensBank&TrustCompany.

Mid-Year

2023

$25B

$20B

$15B

$10B

$5B

$0

In2022,thepublicmarket’sdramaticpullbackandfederalinterestratehikescausedsharpdropsininvestmentdollarsfrom2021’shistorichighs.Hintingatabottom,quarter-over-quarter(QoQ)investmenthasbeenrelativelyflatthelastthreequarters.Perhapsinvestorshavefoundan“idlingspeed”astheyevaluateportfoliosandmarketconditions.

Onenuancetothisperiod:downrounds

aremoreprevalentthanever,butmanygo

unreported.It’spossiblethistranslatesinto

additionalinvestmentactivitynotcaptured

here,albeit“painful”activityforstakeholders.

TheS&PBiotechIndexendedH1’23flatbutisup15%sincelateMarch.PublicmarketmomentumisdrivenbybetteralignmentbetweenmarketexpectationsandFedinterestrateprojections,abloominM&Aactivity(e.g.,Seagen,DICE,Chinook),andanumberofnoteworthydatareadouts.ThishasbredoptimismandatrickleofIPOs,butmoreneedstohappenbeforemarketsaredeemedhealthy.Mainly,investorsandBoardsaligningontermstodriveresearchforward,later-stageinvestorsworkingthroughabacklogofcompaniesthey’dexpectedtobepublicbynoworarepublicbuttradingatbargainprices,andreckoningwithalargesupplyofcompaniesneedingadditionalprivaterounds.

Webelievewe’refirmlyinanewphasedefinedbyfocusonvaluationand“fundamentals”likeclinicalassetsandpathstocashflowoperations.Whileapainfulreset,thespringisloadedwithamplecapitalandagoldenageofscience.

VCDollarsandDealsbyHealthcareSectors

US,EU&UK

854

764

740

668

596

558

534

483

453

779

552

715

747

747

Q1’20Q2’20Q3’20Q4’20Q1’21Q2’21Q3’21Q4’21Q1’22Q2’22Q3’22Q4’22Q1'23Q2'23

2020

2021

2022

H12023

Sectors($M)

US

EU&UK

Total

US

EU&UK

Total

US

EU&UK

Total

US

EU&UK

Total

Biopharma

22,532

4,795

27,327

31,630

6,946

38,576

24,960

4,787

29,747

8,338

1,960

10,298

Healthtech1

11,770

1,605

13,374

33,133

2,881

36,014

13,293

3,861

17,154

5,021

588

5,609

Dx/Tools

9,128

1,755

10,883

11,988

2,713

14,701

7,968

1,582

9,550

1,924

878

2,801

Device

5,764

850

6,615

6,794

2,383

9,176

6,798

1,549

8,347

2,380

912

3,293

Total

49,197

9,040

58,237

83,581

14,927

98,508

53,043

11,783

64,826

17,691

5,088

22,779

Note:1)Healthtechdealsthatoverlapwithothersectorsarenotincludedinhealthtechtotalsonthisslide

butareincludedinhealthtech-specificanalysesonpage11.Financingdataincludeprivatefinancingsby

venture-backedcompaniesintheUS,EUandUK.Datesoffinancingroundsaresubjecttochangebasedon

add-oninvestments.

HEALTHCAREINVESTMENTSANDEXITS|MID-YEAR2023UPDATE7

Source:PitchBookandSVBproprietarydata.

Mid-Year

2023

Dealcount(2022-H12023)

Overall

Biopharma

Healthtech

Dx/Tools

Device

46

21

32

6

9

44

18

26

6

7

35

15

21

6

6

34

12

20

6

6

30

11

16

6

5

29

10

16

6

5

29

9

11

5

4

29

9

11

5

4

Note:1)Mostactivenewinvestorscalculatedasnew(first-time)investmentsinUS,EUandUKcompaniesfrom2022-2023.Datesoffinancingroundssubjecttochangebasedonadd-oninvestments.Additionalinvestorsnotlistedduetospacelimitations.

Source:PitchBook,conversationswithinvestorsandSVBproprietarydata.Allnon-SVBnamedcompaniesareindependentthirdpartiesandarenotaffiliatedwithSiliconValleyBank,adivisionofFirst-CitizensBank&TrustCompany.

HEALTHCAREINVESTMENTSANDEXITS|MID-YEAR2023UPDATE8

DealSize

2023$2.5B(128)

2020$6.1B(281)

$12M

$8M

H12023

$3.0B

$1.9B

$2.2B

$17M

$12M

2022

$2.2B

$874M

$1.4B

$1.6B

$17M

$12M

2021

$2.2B

$1.9B

$1.9B

$1.5B

$1.3B

$1.2B

$901M

$12M

$12M

2020

Early-stageinvestmentjumpedinQ2’23butatmassivelyresetvaluations.Thepaceofinvestmentwasnearlyequaltothepriortwoquarterscombined,butvaluationsduringQ2broughtmedianSeriesApre-moneyvaluationdownfrom$16MduringQ1to$11MforQ2’23.

Onequarterisnotatrend,butthesedatareinforcemarketanecdotesthatSeriesAdealactivityrevolvesaround:(i)top-tierprofileswithamixtureofveteranmanagementteams,in-humandata,provenmodalities,de-riskedtargets,or(ii)compellingstoriesata“2023marketprice.”ThelargeSeriesAdealsarerarerbutdrivetotalinvestmentdollars(e.g.Orbital,ReNAgade,CARGO),whilemorecommon,smallerdealsmoderatethemedianvaluation.

Surprisingnoone,platformandoncologycompaniescontinuetocapturethemostinvestmentwhilerespiratoryindicationshaveseensteepdeclinesduring2023.Itwillbeinterestingtoseeifrecentapprovalsinneurology(e.g.,Eisai/Biogen,Amylyx)driveadditionalinvestmentlikewesawfollowingtheapprovalofAduhelm.

InvestorsarelookingforSeriesAcandidatesthatcandrawlinesbetweenapalatablevaluation,runwaythroughmeaningfulmilestones(forwhichthebarhasbeenraised),andrealisticexitprospectsthatdonotrelyupontheIPOwindowopeninginthenext12-18months.

.

Biopharma

MedianSeed/

SeriesAValuations

Pre-MoneyValuation

Seed/SeriesA1Dollarsand(Deals)

Q1Q2Q3Q4

2021

$9.0(355)

2022

$6.5B(293)

H12020H22020H12021H22021H12022H22022H12023

Seed/SeriesADollarsandDealsbyTopIndications

2021

2022

H12023

Indications

Dollars($)

Deals

Dollars($)

Deals

Dollars($)

Deals

Platform

3.4B

81

2.2B

97

964M

32

Oncology

1.6B

76

1.8B

77

507M

48

Ophthalmology

194M

9

202M

9

289M

3

Neurology

1.7B

56

294M24

270M

10

Cardiovascular

62M

9

66M

6

148M

3

Auto-Immune

355M

11

479M14

148M

4

Orphan/Rare

379M

6

141M

16

59M

2

Note:1)Seed/SeriesAincludesfirst-timeinvestmentsfrominstitutionalorcorporateventureinvestmentintheUS,EUandUKandanyfirst-roundinvestmentsequaltoorgreaterthan$2M,regardlessofinvestor.Datesoffinancingroundsaresubjecttochangebasedonadd-oninvestments.

Source:PitchBookandSVBproprietarydata.

LargestH12023Seed/SeriesADeals

9

Allnon-SVBnamedcompaniesareindependentthirdpartiesandarenotaffiliatedwithSiliconValleyBank,HEALTHCAREINVESTMENTSANDEXITS|MID-YEAR2023UPDATE

adivisionofFirst-CitizensBank&TrustCompany.

DespiteanimprovedinterestrateoutlookandglimmersofmomentuminthepublicequityandM&Amarkets,availabledataforlate-stagebiotechinvestmenttrendsnearpre-2020levels.

TheIPOwindowremainslargelyclosed,manypubliccompanystocksarefightingtoeclipseIPOprices(orevencurrentcashbalances),andprivatevaluationsareunderintensescrutiny.ThebuildingbacklogofLIPO1companiesisincreasingcompetitionforcapital.Compoundingthis,traditionallate-stageinvestorsremainfocusedonexistinginvestmentsandpubliccompaniestradingatattractivevaluations.

Inourlastreport,wepredictedthatcapitalforinsiderbridgeroundstopreservevaluationwasunlikelytolastthrough2023.Anecdotalevidenceindicatesthatawaveofdownroundsand“structured”termsheetshavecometomarketalongsidecontinuedcost-savingmeasures.

Ofnote,manyofthesedownroundsandstructuredtermsheetscomefromexistinginsidersandgounreported.It’slikelythereisahiddenstoryofeven

greaterinvestmentbutatresetvaluations

orwithtermspunitivetoearlyinvestors.

Whilepainful,thiscouldbethebeginningofaseachangethatunsticksmachineryinthelifesciencecapitalrecycler,openingthewayforwardforprivatecompanies’nextroundsandeventualpathstopublicmarkets.

Biopharma

Highest-ValuedH12023

Financings2

TotalDollarsand(Deals)

Q1Q2Q3Q4

Platform$3.6Bpost

Oncology$1.3Bpost

Auto-Immune$715Mpost

Platform$702Mpost

Auto-Immune$680Mpost

Platform$602Mpost

Gastrointestinal$525Mpost

Orphan/Rare$491Mpost

Platform$455Mpost

Oncology$380Mpost

Platform$330Mpost

Oncology$315Mpost

2021

$38.6B(912)

2022

$29.7B(790)

2023$10.3B(373)

2020

$27.3B(699)

$9.1B

$8.2B

$8.7B

$6.8B

$11.3B

$6.1B

$5.5B

$6.7B

$5.8B

$12.6B

$5.6B

$8.1B

$6.7B

$4.7B

H12020H22020H12021H22021H12022H22022H12023

LIPODealActivityinBiopharma1

Quarter

LIPODeals

MedianPre-Money($M)

MedianDealSize($M)

IPO%

Q1’20

17

245

108

88%

Q2’20

21

150

86

62%

Q3’20

28

140

92

57%

Q4’20

15

140

87

60%

Q1’21

37

184

100

57%

Q2’21

31

200

105

10%

Q3’21

24

169

90

21%

Q4’21

16

172

102

13%

Q1’22

14

160

100

0%

Q2’22

2

-

-

0%

Q3’22

3

-

-

0%

Q4’22

14

120

95

0%

Q1’23

3

-

-

0%

Q2’23

8

-

-

0%

Note:1)TheLIPO(likelytoIPO)listtracksthetop15crossover-fundedprivatemezzaninedeals($40M+)

asaproxyforIPOsentimentandpipeline.2)Onlyincludesprivatepost-moneyvaluesfrompubliclydisclosed

2023financingsinPitchBook.Financingdataincludesprivatefinancingsbyventure-backedcompaniesintheUS,

EUandUK.Datesoffinancingroundsaresubjecttochangebasedonadd-oninvestments.

Source:PitchBookandSVBproprietarydata.

HEALTHCAREINVESTMENTSANDEXITS|MID-YEAR2023UPDATE10

Allnon-SVBnamedcompaniesareindependentthirdpartiesandarenotaffiliatedwithSiliconValleyBank,

adivisionofFirst-CitizensBank&TrustCompany.

$5M

$10M

H12023

$13M

$5M

2022

$4M

$10M

2021

$10M

$5M

2020

2020$22.4B(877)

2023$8.5B(712)

$17.1B

$12.2B

$7.5B

$6.4B

$11.5B

$5.1B

$5.4B

$10.2B

$10.1B

$4.6B

$3.2B

$6.2B

$5.1B

$5.2B

HealthtechinvestmentkickedoffrelativelystronginQ1,especiallyforseed/SeriesAcompanies.However,dollarsslowedsignificantlyfromQ1toQ2’23:

Seed/SeriesAinvestmentslowed63%,andoverallinvestmentslowed39%.Weareontracktohit2019’spaceifthisinvestmentpacecontinuesintoH2’23.

Althoughearly-stageinvestmentslowedinQ2’23,early-stagecompaniesstilltookasignificantshareofinvestmentin2023(22%in2023,upfrom15%in2022and11%in2021).Thesecompaniespresentnewopportunitiestoinvestatconservativevaluationsthatreflectthecurrentfundingenvironment.Weexpectinvestmenttoremainfirmlyrootedinearly-stage,asmarketuncertaintycontinuestoputpressureonvaluations.

Difficultybringinginnewcapitalin2023isdrivenbytwomainchallenges:1)howtoattractnewinvestorsand2)howtobringinnewcapitalwithoutcrushingpreviouslyestablishedhighvaluationsinadownorflatround.Challengesattractingnewinvestorsin2023createdmoreinsider-leadrounds,whichcomprised60%ofallhealthtechdealsinQ2’23,nearlydoubletherateinQ1’23(34%)and2022(30%).Asinvestorsincreasinglyfocusonshoringuptheirexistingportfoliocompanies,weexpectinsider-ledroundstocontinuebutlikelyatrevisedvaluations.Moreandmoredownorflatroundsareclosingasthemarketremainsdifficult.Theseroundsareoftenkeptprivatewithoutalabeltodelayvaluationhaircuts.WeprojectmoreroundslikethiswilloccurinH2’23.

Healthtech

MedianSeed/

SeriesAValuations

Pre-MoneyValuation

Seed/SeriesA1Dollarsand(Deals)

Q1Q2Q3Q4

DealSize

2021

$5.3B(561)

2022

$4.3B(551)

2023$1.9B(271)

2020

$2.9B(308)

$2.1B

$1.1B

$1.7B

$1.3B

$521M

$1.1B

$809M

$577M

$1.4B

$605M

$967M

$899M

$689M

$589M

H12020H22020H12021H22021H12022H22022H12023

TotalDollarsand(Deals)LargestH12023Deals

Seed/SeriesA

LaterStage

Q1Q2Q3Q4

2021

$49.5B(1,398)

2022

$29.6B(1,418)

H12020H22020H12021H22021H12022H22022H12023

Note:1)Seed/SeriesAincludesfirst-timeinvestmentsfrominstitutionalorcorporateventureinvestment

intheUS,EUandUKandanyfirst-roundinvestmentsequaltoorgreaterthan$2M,regardlessofinvestor.

Datesoffinancingroundsaresubjecttochangebasedonadd-oninvestments.

Source:PitchBookandSVBproprietarydata.

HEALTHCAREINVESTMENTSANDEXITS|MID-YEAR2023UPDATE11

Allnon-SVBnamedcompaniesareindependentthirdpartiesandarenotaffiliatedwithSiliconValley

Bank,adivisionofFirst-CitizensBank&TrustCompany.

2021

$1.2B(188)

2022

$1.4B(189)

Q2

$4M

$10M

2023

$10M

$4M

2022

$6M

$9M

2021

$9M

$4M

2020

2020$10.9B(343)

2023$2.8B(251)

$4.5B

$3.6B

$3.4B

$2.8B

$3.3B

$3.4B

$3.5B

$3.4B

$3.1B

$1.4B

$1.4B

$886M

$1.9B

$1.4B

Dx/ToolsinvestmentinH1’23matchedthatofH2’22forSeriesAandlate-stageinvestments,carriedbyQ1’23activityinbothcases.

Thepublicmarketsremainclosedfornewentrants,andallindictorspointtowardahigherbarforIPOhopefulsbothintermsofrevenuerun-rateandabilitytogeneratecashflow.Investorsaredrivingarotationinstrategy:tradinghigh-costrevenuegrowthforlineofsighttocash-flowpositiveoperations.Manyteamshavebeenaskedtodomorewithlessandrecraftfinancialplanstofocusonachievingself-sufficientoperationsratherthantargetrevenuerun-rate“exitvelocity.”Thiscouldbe,inpart,duetodepresseddemandfornewtoolsasR&Dcustomersalsorefocusonpreservingspendtofewerinitiatives.

Onebrightspotforinvestmenthasbeensequencingandgenomichealthsolutions.Asnewsequencingtechnologycomestomarketatlowercosts,dx/toolscompaniescanquicklyscaleupgenomicdiagnosticservices,includingtestingmethodsforprecisionmedicines.InApril2023,GenomeInsightandUltimaGenomicsannouncedapartnershiptolowerthecostofgenomesequencingforcancerpatients,andthestartupwilljoinUltimaGenomics’earlyaccessprogramforitsnext-generationsequencingplatform.Asthedemandforgenomicsequencinggrowsalongwithtestingforprecisionmedicine,therecouldbeanincreasingdemandforsequencingequipment.ThispresentsastrongopportunityforR&Dtoolscompaniesinthespace.

Dx/Tools

MedianSeed/

SeriesAValuations

Pre-MoneyValuation

Seed/SeriesA1Dollarsand(Deals)

Q1Q2Q3Q4

DealSize

2023$831M(101)

2020

$819M(111)

H1

$97M

$150M

$311M

$262M

$310M

$212M

$413M

$609M

$320M

$370M

$519M

$274M

$279M

$181M

H12020H22020H12021H22021H12022H22022H12023

TotalDollarsand(Deals)LargestH12023Deals

Seed/SeriesA

LaterStage

Q1Q2Q3Q4

2021

$14.7B(512)

2022

$9.6B(460)

H12020H22020H12021H22021H12022H22022H12023

Note:1)Seed/SeriesAincludesfirst-timeinvestmentsfrominstitutionalorcorporate