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The Swiss biotechnology sector is a magnet for investment

Last year, the biotechnology sector in Switzerland grew again and proved to be a magnet for fresh capital and investment. The total number of employees in the 250 biotech companies and 62 supplier companies rose by around 5% to 15,070. The Swiss biotech industry generated total sales of $4.96 billion (CHF 4.8 billion) in 2019. This is shown in the Swiss Biotech Report 2020.

Angelique Moss

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This picture show a Swiss boat.

Michael Altorfer, CEO of the Swiss Biotech Association, would have loved to present the strong figures registered by the biotech sector, at the Swiss Biotech Day. Due to the coronavirus pandemic, the industry meeting planned in Basel was rescheduled to mid-September – and the Swiss Biotech Report was presented online.

The Swiss Biotech Association published the report in collaboration with EY and seven other partners. The bottom line: Embedded in one of the world’s most comprehensive life science ecosystems, Swiss biotechnology was able to score points again last year with growing sales and a strong financing environment.

Find out more information about the Swiss biotech sector and read the latest financial headlines with our companion app, Born2Invest.

Investments in research and development increased by 7%

The total number of employees in the 250 biotech companies and 62 supplier companies increased by around 5% to 15,070. In addition, 40 start-ups were founded. Investment in research and development climbed by around 7% to around $2.06 billion (CHF 2 billion).

The Swiss biotech industry generated total sales of $4.96 billion (CHF 4.8 billion) in 2019, $825 million (CHF 800 million) more than in the previous year. This increase in revenues was mainly driven by lucrative collaboration and licensing agreements for AC Immune, Basilea and CRISPR Therapeutics. In addition, biotech companies that are already commercializing products and services generated higher revenues.

The importance of the industry to the country is underpinned by exports of pharmaceutical and biotechnology products. In 2019, they accounted for about 40% of the total Swiss export volume. “The great strength of the Swiss biotech sector is its continuity. There is constant growth and we continue to succeed in attracting specialists and young talents to Switzerland,” Altorfer emphasised.

The biotech sector strengthened its position as an attractive field of financing

In 2019, $1.24 billion (CHF 1.2 billion) was invested in private and listed biotech companies, significantly less than in the previous two record years, but still above the $1.03 billion (CHF 1 billion) mark. The sum was divided almost equally between listed and private companies.

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Thanks to new specialized funds established in Switzerland, the ecosystem was able to further strengthen its position as an attractive field of financing, according to the authors of the report. Examples are Medicxi, ND Capital, Pureos Bioventures, and Bernina BioInvest. At the same time, the number of foreign funds has also grown steadily. The only exception was the IPO of Swiss biotech in 2019. “The financing landscape is now so broadly based that the pressure to go public has decreased,” said Altorfer.

The Swiss biotech ecosystem has become even more diverse, Altorfer said. “Further gaps in diversity have been closed and capacities expanded.” For example, multinational biopharmaceutical companies such as Biogen, CSL Behring, Novartis, and Merck have invested heavily in expanding production capacities for the increasing number of approved complex biologics and cell therapies. In addition, companies such as SOPHiA Genetics, BC Platforms, Genedata, Insphero, GenomSys, and SimplicityBIO are increasingly using the possibilities of artificial intelligence.

More than 3,000 patent families that combine artificial intelligence and biotechnology

“A new segment of companies is developing in this field, which accesses and analyzes data pools and thus substantially changes clinical development and the design of studies,” explained Altorfer. Patent analysis for the Swiss Biotech Report showed how dynamically the scene is developing. According to the report, there are already more than 3,000 patent families that combine artificial intelligence and biotechnology.

Of course, the current corona crisis was also a topic at the presentation of the industry figures. According to Altorfer, two dozen Swiss biotech companies are investing resources in the development of diagnostics, therapies, or vaccines to combat the coronavirus pandemic. At the same time, the restrictions currently in place in preclinical and clinical projects are delaying data collection and timetables.

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A further challenge for the Swiss biotech sector is that around 80% of companies do not have access to emergency aid loans, as companies have to show sales figures for these. However, this is precisely where politicians are working out solutions.

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(Featured image by Noah Näf via Unsplash)

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Angelique Moss is a London-based entrepreneur, writer, and traveller. The world of business, finance, and technology, is her preferred cup of tea. She also writes about the developments and discussions on health, art, luxury and media. A top writer for several Medium publications, she has published hundreds of widely read articles on investing, stocks, global markets, cannabis, and technology for multiple platforms. She is also interested in culture, history, and social affairs.