Investment in Catalonia has a countercyclical behaviour in the startup ecosystem. While investments in Europe and the United States have registered significant decreases during 2022 in the amount of capital raised in the biotech and medtech sectors, the Catalan ecosystem continues to rise and has increased by 87% compared to the previous year, reaching a total of €445 million.
These data are gathered in the Study on investment in the health sector in Catalonia 2022, promoted by CataloniaBio & HealthTech, together with EY, presented this Thursday 27 April at the Connection Day in Barcelona.
Companies in Catalonia have once again sought support from venture capital funds (VC), which have become the main source of financing, accounting for 77% of the capital raised. These are historical data that have specific names, with three main funding rounds. On the one hand, the medtech company Impress, the first megadeal in Catalonia with 122 M€; and the biotech companies Minoryx Therapeutics and SpliceBio, which have carried out the largest operations in their sector, with more than 50 M€ respectively.
"In both the US and Europe, investment in the biotech and medtech sector has registered a very significant decline during 2022. Contrary to this international trend, in Catalonia, investment in start-ups in the health sector has increased by 87% to reach the figure of €445M due to an investment of more than €200M in three companies. It remains to be seen how it evolves in 2023", Silvia Ondategui, EY Life Sciences Global Partner.
By sub-sectors, the upward trend in medtech is confirmed, which has already seen its investment figures grow exponentially from €7 million in 2018 to €193 million today. On the other hand, biotech companies have recovered from the 2021 funding shortfall and have set a new record with an investment figure of €185 million. The digital health sector is the worst performer, having seen its capital reduced to €39m. This decline, however, is not represented in the number of operations, which have increased by almost 20% in 2022.
The other companies present in the ecosystem, such as service providers, have seen, thanks to the €22m round by the IT services company Seqera Labs, that the amount of capital raised has increased more than fivefold compared to 2021, with €28m raised in 2022.
Regarding the origin of the investments, the presence of local shareholders continues to be the majority and almost 9 out of every 10 shares in each company are owned by a Catalan investor. This figure excludes large pharmaceutical companies, which do have more confidence in foreign investment, and alters the average for start-ups. However, there is a trend in international investment where, for example, Catalan digital health companies already have an average of 14% foreign investment.
"The year 2022 marks a clear trend towards success in terms of attracting and investing foreign capital. Companies have the challenge of maintaining this trend and demonstrating that international interest is not just the merit of a few companies in specific cases. And Catalan companies have also known how to open up to new markets, a fact that is also considered key by investors to give visibility to the health sector," says Joan Puig, president of CataloniaBio & HealthTech.
Collaborations and R&D projects
Collaborations between companies in the health sector and research institutes continue to generate added value. Micro-companies and SMEs and research centres have been the main partners with which companies in general have collaborated in more R&D projects, with 35% and 28%, respectively. Analysing by sector, Catalan biotech companies are, with 56%, the ones that collaborate most with other micro-enterprises and SMEs. In the service companies, we see that the digital health group collaborates regularly with micro-companies and research centres (38% and 32%), and the service sector is, by far, the one that collaborates most with universities, with 37%.
In terms of research areas, oncology has been the main area where efforts have been focused (22% of companies have carried out R&D projects in this field). Other areas such as advanced therapies have also been a common focus for companies in the sector (especially medtech companies), being the second area where most effort has been invested.
The direct view of the companies in the sector
The data used to prepare the study are obtained from direct interviews with the companies and institutions that are members of CataloniaBio & HealthTech. In addition, the investors' perspective has been included in the preparation of this year's report, which provides a new and complementary view of the sector.
8 out of 10 companies reported having achieved the targets they set themselves for 2022. Product development companies, which form part of the biotech and medtech sectors, achieved their targets in 71% and 82% of cases. 92% of digital health companies also achieved their objectives, while in the services sector, 71% of companies responded in the affirmative. The pharmaceutical sector has shown a high performance despite the extraordinary results of 2021, with 100% of the pharmaceutical companies surveyed admitting to having met the targets set.
Both companies and investors are satisfied with the performance of the health sector in 2022. Most of the companies have met the objectives they had set themselves despite the adverse circumstances. Investors perceive and value the resilience of the industry in Catalonia as an example of the quality of the ecosystem and professionalism of the sector.
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