#AseBioID24 | 'AseBio Investor Day is a unique meeting point for companies and investors specialized in the biotechnological sector'

AseBio

08 April 2024

Biotechnology is a deep tech that is transforming the world through disruptive innovations with a high impact on societies, economies, and the planet's sustainability. This is why R&D&I is at the core of the business model of biotech companies.

These companies operate in highly regulated markets and face significant complexity, resulting in innovations characterized by long cycles, the need for substantial investment volumes, and high risk. The scenario we observe in Spain reveals an environment where most biotechnology companies are small and micro-enterprises that do not have products in the market and therefore do not generate resources to finance their activities. Hence, access to external financing is crucial for the development of the biotechnological ecosystem.

In this context, on May 15, 2024, the city of San Sebastián will become a meeting point between prominent national and international investors and biotechnology companies on the occasion of the celebration of a new edition of the AseBio Investor Day, an event organized by AseBio that stands as a benchmark in terms of biotechnological innovation. To analyze the Spanish biotechnological ecosystem and delve into the challenges and opportunities it presents, we interviewed Susana de Antonio Horcajo, Head of Listing Spain at Euronext, Silver Sponsor of the AseBio Investor Day 2024.

AseBio. Euronext is the leading European stock market for biotechnology and the second worldwide. How do you promote access to financing for biotechnology companies?

Susana de Antonio. At Euronext, we pay special attention to the technology sector, particularly within Healthtech, as it is a capital-intensive sector with significant global growth potential. We have a base of over 130 companies in the healthtech sector listed on our markets (more than 70 biotech, over 50 medtech, and around 10 nutraceuticals), which represents a highly relevant base of comparable companies and an unmatched investor base (over 1,000 institutional investors from more than 40 countries), facilitating access for new companies in the sector.

Additionally, to assist new companies in accessing the markets, we organize pre-IPO training programs such as IPOReady, which allow innovative companies with growth ambitions to understand the IPO process, making it a viable financing alternative for them.

Once companies are listed, they have recurrent and efficient access to financing through capital increases that can be executed quickly in the market. Furthermore, they have the opportunity to join our Tech Leaders initiative, for leading companies in different technological segments listed on Euronext, providing additional recognition and visibility. Companies such as Galapagos, Argenx, Hyloris, or Nyxoah are part of this group.

With all this, we aim to facilitate the growth of European companies and help them become global leaders.

AseBio. Over the past few decades, the sources of funding for biotechnology companies have expanded. What are the current alternatives to traditional sources of funding?

Susana de Antonio. Depending on the stage of development, the range extends beyond public funding, business angels, FFFs (friends, family, and fools), venture capital funds, to capital markets.

AseBio. Most biotechnology companies are small and micro-enterprises that do not have products in the market and therefore do not generate resources to finance their activities. Due to this, access to external financing is crucial. What are the main challenges that biotechnology companies face in terms of financing?

Susana de Antonio. Biotechnology companies typically face a long period of investment without associated revenues while completing their trials. It is essential to ensure sufficient funding to meet milestones, focusing on the appropriate investor profile for each stage.

AseBio. What role do specialized venture capital funds play in the development of biotechnological R&D?

Susana de Antonio. Specialized venture capital funds play a fundamental role in the sector's development since the biotechnology sector usually does not fall within the investment objective of most generalist venture capital funds.

These specialized funds accumulate unique and valuable expertise in identifying and investing in companies with better prospects, aiding in their visibility. Moreover, having a certain profile of funds in the shareholding structure significantly helps in subsequent financing rounds and even in a potential IPO, as they provide reassurance to new investors.

As a next step after investment by a specialized fund, an IPO is a natural step for biotechnology companies that have reached a certain degree of development. In the case of Euronext, we have companies in different stages of development (always at least in clinical phase), although the most common scenario for biotechs is to be at least in Phase II and have CE marking and certain level of sales for medtech.

Additionally to the capital raised at the time of the IPO, once companies are listed, they have recurrent and efficient access to financing through capital increases that can be executed quickly in the market. This is especially relevant in the Healthtech sector where companies often need new funds over an extended period of time.

Moreover, being a listed company offers other qualitative advantages, such as greater visibility, credibility, and the ability to attract and retain talent.

AseBio. The AseBio Investor Day stands as one of the most important meeting points between investors and biotechnology companies, united by the common thread of innovation. What opportunities does an event of this nature offer?

Susana de Antonio. An event like the AseBio Investor Day is a unique meeting point for companies and investors specialized in the biotechnology sector. This results in increased visibility, not only domestically but also internationally, better access to investment, and opportunities for development and partnerships.

AseBio. What do you expect from participating in an event of this nature?

Susana de Antonio. We expect to have the opportunity to interact with key players in the health sector, both at the Spanish and European levels, with the aim of establishing relationships and collaborations that support the ecosystem and facilitate the creation of global leaders.