Top 5 European BioTech Startups To Watch

Responsible for the creation of about 486k full-time jobs and generation of €31.6B across EU countries, white biotechnology, also known as industrial biotech, was all the talk at this year’s European Biotech Week. But what about red biotechnology which, according to a study, is responsible for adding the most value to the economy per employee?

Despite the recognized importance, European biotech startups generally face a significant difficulty when looking for funding opportunities. This is a problem that U.S. biotechs are not confronted with, as Americans seem much more eager to invest in this type of companies. Accordingly, the Wall Street Journal writes: “Wall Street’s seemingly insatiable appetite for biotechnology stocks has led to a surge in small companies from Europe listing in the U.S., where they can fetch higher valuations than in their home markets”.

Even with such obstacles, some of Europe’s red biotechnology startups have managed to attain high market capitalizations, suggesting that even though a radical improvement is needed to support the biotech ecosystem, innovative startups can still succeed big time, even if for doing so they need foreign investment.

Today, we will focus exclusively on European biotech startups specialized in red biotech founded in 2010 or later that captured enough investor interest to achieve multi-million Euro valuations, despite the risk-aversion problem the continent is currently facing.

4D Pharma

With a valuation of €518M despite being founded in 2014, 4D Pharma appears to have been very persuasive in getting investors on board, although some of the success may be attributed to it being located in the U.K. where the funding problem is less of an issue in comparison to other European countries. The startup focuses on pharmaceuticals and became a world leader in developing live therapeutics (biological products that contain live organisms, generally bacteria). At the moment, they have preclinical programs that range from cancer to multiple sclerosis and rheumatoid arthritis among others.

Inivata

Launched in the same year as 4D Pharma with a capitalization of about €380M, another U.K. based startup is Inivata. The company focuses on clinical cancer genomics and developed a new, non-invasive way to detect and analyse genomic material. Only a blood sample is needed for their revolutionary approach which changes for the better not only cancer detection, but also the way the disease is monitored and treated.

ProQR

Netherlands’ ProQR was able to reach a market capitalization of roughly €103M and specializes in the development of drugs aimed at transforming the life of people suffering from serious genetic diseases. The company started out in 2012 when a team of RNA experts gathered with the aim of finding a treatment for cystic fibrosis by using RNA therapy. In the meantime, the company developed further programs with the goal of finding a treatment for other genetic disorders, among which Usher syndrome and Alzheimer’s disease.

Arsanis

Founded in 2010, Austrian based Arsanis raised €45M that it will use in identifying new methods of fighting serious infectious diseases with the help of monoclonal antibodies. The startup contributes in the war against bacterial resistance which is becoming a serious issue due to overuse of antibiotics. The immunotherapies designed by Arsanis are supposed to not cause damage to the patient’s microbiome, thus avoiding complications such as bacterial resistance.

Wilson Therapeutics

Last but certainly not least, we have Sweden’s Wilson Therapeutics with an impressive €243M market capitalization, which focuses, as the name suggests, on finding new therapies for patients suffering of Wilson Disease a disorder that causes copper poisoning. Their active ingredient, tetrathiomolybdate, aimed at the reduction of copper, has already gone through several clinical studies, and shows promising results and is well-tolerated by patients.

Even though the companies listed above were successful in securing funding, they achieved this mostly through NASDAQ. If one compares the numbers for the U.S. and E.U., there is a stark difference in capital raised by biotech companies. 2015 saw a staggering $61.B total in capital raised by the U.S., while the equivalent number for the E.U. is $9.9B. Currently, there is much room for improvement for E.U. policies in helping biotech thrive – conclusively it is no wonder that many European biotech startups enlist on NASDAQ to satisfy their funding lust.

 

 

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