Trends in Healthcare Investments and Exits Presentation

Trends in Healthcare
Investments and Exits - 2014
July 2014

Healthcare investments stabilize as IPOs surge
Trends in Healthcare Investments and Exits
http://www.svb.com/healthcare-report/ 2
The story of the healthcare venture industry in 2013 can be summed up in three
words: initial public offerings. In a year in which the number of venture-capital
backed healthcare IPOs tripled, public market enthusiasm helped stabilize
venture investment and fundraising overall. It also led to increased valuations of
big exit mergers and acquisitions.
Venture investment in healthcare saw the biggest returns since SVB started
tracking the data in 2005, reaching double the next best year. As we note in this
report, the climate for IPOs is cooling. However, we see the current balanced
financing ecosystem continuing to prime the innovation pump and encourage
smooth capital flow to keep the industry humming.
Silicon Valley Bank produces this annual report to guide our clients in decision-
making and to contribute valuable insight into the top trends in the healthcare
venture industry. We analyzed proprietary and public data and forecasts to
determine trends at both ends of the pipeline: on the capital side through venture
investment into companies and venture fundraising, and on the liquidity side
through big exits and IPO activity.

Table of Contents
4. Venture fundraising and investment drive innovation
14. Healthcare big exit M&A dips as IPOs surge
18. Biopharma analysis: What’s hot, What’s not
24. Device analysis: What’s hot, What’s not
3

Healthcare Accounts for 22 Percent of Total Venture
Investment

Gap Between Capital Raised and Invested Narrows in
Recent Years Signaling Sustainability

Corporate Venture Bolsters Early-Stage Biopharma
Companies

Investment in Early-Stage Device Companies Lags

New Money in Biopharma Going to Early-Stage Companies

Oncology is the Most Popular Indication

Top New Money Corporate Investors in Biopharma

More than Half of New Money Biopharma Investments Were
in Pre-clinical or Phase I Companies
11
http://www.svb.com/healthcare-report/

New Money in Device Spread Between Early-Stage and
Later-Stage Companies
12
http://www.svb.com/healthcare-report/?

Ophthalmology and Orthopedic are the Most Popular
Indications
13

The Year of the IPO: Big Exit M&A Dips as IPOs Surge
14

Healthcare Sees Record Potential IPO/Big Exit Returns
15

Biopharma Structured Deals Continue with Higher Upfront
Payments
16

Device Big Exit Activity Declines but Values Increase
17

Oncology is the Darling of BioPharma Big Exits
18

Half of Biopharma Big Exits Occurred at Phase III or
Commercial-Stage
19

Biopharma Big Exit M&A Activity Shifts to Later-Stage
Companies
20

Earlier-Stage Biopharma Companies are Opting for IPOs
over M&A
21

BioPharma Big Exit M&A and IPOs Focus on Oncology and
Respiratory
22

Large Corporations Increase Biopharma Acquisitions
23

Imaging/Diagnostics and Vascular Lead Device Big Exits
24

Device Big Exits Decline Slightly
25

Bucking Convention, FDA Approval Not Necessary for Device
Big Exit
26

Cardiovascular and Vascular Lead Trend of Non-FDA-
Approved Device Big Exits
27

This material, including without limitation the statistical information herein, is provided for
informational purposes only. The material is based in part upon information from third-
party sources that we believe to be reliable, but which has not been independently
verified by us and, as such, we do not represent that the information is accurate or
complete. The information should not be viewed as tax, investment, legal or other advice
nor is it to be relied on in making an investment or other decision. You should obtain
relevant and specific professional advice before making any investment decision.
Nothing relating to the material should be construed as a solicitation or offer, or
recommendation, to acquire or dispose of any investment or to engage in any other
transaction.
©2014 SVB Financial Group. All rights reserved. Silicon Valley Bank is a member of
FDIC and Federal Reserve System. SVB>, SVB>Find a way, SVB Financial Group, and
Silicon Valley Bank are registered trademark.
Disclaimers
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Trends in Healthcare Investments and Exits Presentation

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