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Sector Investing Series: Biotech M&A Trends

Learn about the biotech sector and some of it's fastest-growing companies

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March 27, 2023

Ever since the pandemic, no industry has been thrust into the limelight quite as much as healthcare and biotechnology. The rapid need for a COVID-19 vaccine, widespread usage of telehealth, and increasing desire to improve the lives of all humans means all signs point to continued growth.

But what exactly does "biotech" entail? What does the future look like for dealmakers angling to break into or expand their portfolio in the industry? And what are some of the fastest-growing examples of companies in the business? We have all the details below.

What is "Biotechnology"?

Biotechnology, or biotech, is an industry that focuses on using technology to advance the healthcare, food, and fuel industries. A large portion of the goods and services we use today exist thanks to the biotech industry, and these companies are continuing to push the boundaries of what's possible. Within biotech, there are a number of different subsectors, each of which focuses on its own area of study:

  • Pharmaceuticals: Oncology, immunology, cardiovascular, central nervous system, vaccines
  • Medtech: Robotic surgery, connected care (telehealth), prosthetics
  • Agriculture: Genetic modification of plants and animals (GMOs), pest control
  • Biofuel: Research into plant-based fuels such as ethanol and biodiesel
  • Services: Contract research organizations (CROs), contract development management organizations (CDMOs)

Biotech Trends: A Growing Industry

As the world grows increasingly complex, some industries may struggle to change with the times, but the biotech industry is not one of them. The industry is growing rapidly as biotech companies continue to innovate and evolve. In 2021, the global biotech market size was estimated at $1.2 trillion, according to Grand View Research, with just under a fourth of that in the US. The research firm also expects the industry to grow at a compound annual growth rate of 13.9% through 2028.

Like other industries, however, M&A has slowed considerably for biotech in the past year. Ernst & Young reported a total of $105 billion in total deal size in life sciences "of which biotech is a part "in the first 11 months of 2022. Unfortunately, this is down 53% from the same time period in 2021 when the total deal size amounted to $223 billion.

The number of deals in 2021 vs. 2022 followed similar trends: there were 161 deals from January to November 2021, whereas just 124 took place the following year "a 23% decrease. Valuations were also down: the same report from EY disclosed that "biopharma M&A value dropped 42% in 2022 compared with 2021."

Nevertheless, when compared with M&A activity as a whole, where global total deal value is down 41.4% according to S&P Global, the decrease in volume and value of deals in biotech is fairly in line. As the macro market bounces back, so should the biotech industry, so dealmakers who get in early are sure to reap the rewards post-slowdown.

Biotech M&A Trends for 2023

Despite a slow year in 2022, the future is bright for biotech in 2023. For firms looking to what biotech M&A trends the year may bring, here are the top three:

Biotech M&A Trend #1: The Industry Is Ready for a Rebound

A record year in 2021 and a sluggish 2022 are setting the stage for the biotech industry to make a comeback. In fact, Rachel Strick, Head of Immunology Business Development & Acquisitions at AbbVie recently disclosed the rising number of opportunities in the podcast, Talking M&A. "There was a long stretch of time where valuations were high and private money felt free," she recounts. "Now that it's harder to raise the private capital and the public markets are very, very tight, the partnership space and the M&A route becomes much more attractive."

Others agree with Strick. PwC predicts a strong year ahead for biotech M&A where total deal value will be back to or higher than 2021 levels "to a tune of up to $275 billion. Firms that are looking to find and make choice deals in the biotech industry will need to be ready to pounce on opportunities as they come available if they're to secure deals.

Biotech M&A Trend #2: Early-stage Deal Preference

Another of the biotech M&A trends for 2023 relates to the size of potential deals. While mega-deals such as Amgen's $27.8 billion acquisition of Horizon Therapeutics are certainly possible "and PwC does predict larger deals will pick up in the latter half of the year "there are many more opportunities at smaller, earlier-stage companies.

As Michael Greeley, co-founder of Flare Capital, discussed in the aforementioned podcast, Talking M&A, "We arguably created too many companies in 2021, and that now needs to be consolidated." This year, smart firms will take advantage of the surge in the number of healthcare companies in biotech since the start of the pandemic, paying special attention to opportunities to add-on to their existing platform investments.

Biotech M&A Trend #3: ESG in Biotechnology Will Continue to Gain Traction

The third biotech M&A trend relates specifically to environmental, social, and governance (ESG) practices. The industry as a whole is concerned with ESG in biotechnology, especially sustainability in the pharmaceutical industry, as ESG initiatives are sometimes the entire reason a biotech company may exist. But for many, ESG specifically has only recently become a particular focus.

For instance, in 2021, a scant 30% of public biotech companies had ESG disclosures in their SEC reporting documents. However, 92% of biotech executives and industry investors thought ESG disclosures would become more important in 2022, according to Fenwick in a February 2022 survey. Investors' reasoning was that they "expect ESG's prominence to grow" and "pointed to increasing pressure from clients to include ESG-focused companies in portfolios."

According to a second round of surveying in November of last year from Fenwick, they were right. "54% have provided ESG disclosure in their proxy statements and eight companies, or approximately 17%, provided ESG disclosure in standalone reports," according to Fenwick. Clearly, ESG in biotechnology has and will continue to gain importance as the industry continues to expand and impact investing grows more popular.

Trends From the 50 Fastest-Growing Bootstrapped Biotech Companies

While macro biotech M&A trends can give certain insights into the industry as a whole, firms looking to add a biotech investment to their portfolio should also consider trends based on the fastest-growing biotech companies. To help, we used Sourcescrub's deal sourcing platform to find the top 50 fastest-growing bootstrapped biotech companies in the world based on their recent 3-month growth.

First of all, nearly two-thirds (62%) of the top 50 fastest-growing biotech companies in our list were US-based, with the UK coming in second at only 16%. Canada was the third most popular at 8% with China, the Netherlands, and Germany at 4% each, and France rounding out the list at 2%.

In terms of subsectors, pharmaceutical companies accounted for half of the list, while services "mostly research and testing companies "came in second at 34%, with Medtech in third at 12%. Surprisingly, agriculture did not show up at all and only one biofuel-focused company made the list.

Perhaps the most surprising trend is the year in which these companies were founded. 46% were founded between 2000 and 2009, with 42% in the decade thereafter. Just 12% were founded since 2020, a number we expected to be higher given the boom of companies and activity since the pandemic began.

Top 10 Fastest-Growing Bootstrapped Biotech Companies

Acuitas Therapeutics

Acuitas Therapeutics works with its partners and customers to develop new or improved medicines based on its internationally recognized capabilities in nanotechnology-based pharmaceutical product development. The company provides delivery solutions for molecular therapeutics using lipid nanoparticles and specializes in messenger RNA (mRNA) delivery.

Advent Bioservices

Advent Bioservices is a contract bio services organization providing Good Manufacturing Practices (GMP) manufacturing services "including lab space "for a variety of advanced therapy medicinal products (ATMPs) and related products, process development (PD), and ancillary services.

Boston Lab Services

Boston Lab Services (BLS) provides experienced and reliable operations support to the Life Science and Biotech industries by offering services for the complete setup and installation of private, research, or medical laboratories, as well as life science facilities.

Centricity Research

Centricity Research is an integrated research organization (IRO) that conducts Phase I-IV clinical research inpatient and outpatient, pharmaceutical, biotechnology, and medical device trials. It offers sponsors and CROs multi-site, multi-provincial and stateside access to clinical research centers and experienced investigators who can perform trials across any therapeutic specialty, including infectious disease, neurology, endocrinology, oncology, cardiology, dermatology, women's health, vaccines and more.


LabDAO operates an open, community-run network of wet and dry laboratories that aims to accelerate progress in the life sciences. They also help researchers secure and manage grants as well as find collaborators and specialist expertise for their research projects.


Novir is a biotechnology and healthcare company that brings together medical experts, trusted partners, and technology solutions to deliver smart, reliable, fast, and flexible testing solutions for companies, schools, and organizations of all sizes.

Quintara Biosciences

Quintara Biosciences specializes in providing high-quality DNA sequencing and genomic services for life science research communities around the globe.


Steri-Tek is a high-volume E-beam, X-ray contract sterilizer, and R&D innovation center serving the medical device, biotech, and pharmaceutical industries, as well as academic institutions and technology businesses.


Tevogen brings together an experienced team of scientists, public health experts, physicians, and life sciences professionals with the goal of advancing global health by investigating the potential of scalable therapies and vaccines. The company aims to leverage its proprietary immunotherapy platform to develop investigational therapies in oncology and viral vaccines, and harness its targeted T-cell therapy to develop investigational products to treat viral infections such as COVID-19 and Influenza.


Triplebar Biologies provides sustainability, biotechnology, and synthetic biology research by offering a platform with hosts, assays, hardware, and software to help researchers find "the 1 in a million 10,000x faster."

See What Sourcescrub Can Do

The biotech industry has seen some tremendous growth in recent years "despite the overall slowdown in 2022 "and it seems poised to take off again this year if current biotech M&A trends hold course. If your firm wants to take advantage of the many opportunities in biotech, a deal sourcing platform like Sourcescrub can help you find the perfect target company.

With over 115,000 sources, Sourcescrub can help you uncover early-stage, bootstrapped companies in any industry, including biotech, that fit your firm's investment thesis. With insights and information that no other deal sourcing platform can provide, Sourcescrub can accelerate your search and discover hidden gems in this increasingly competitive market.

For a jumpstart on your research, download our list of the top 50 fastest-growing bootstrapped biotech companies.