Close this search box.

New report shows that Swiss biotech capital investment surged last year

In 2023, the Swiss biotech industry achieved record revenues of $8 billion (CHF 7.3 billion) and raised over $2.2 billion (CHF 2 billion) in capital investments, marking a significant 50% increase from 2022. These impressive figures were highlighted in the recently released Swiss Biotech Report 2024, published in April. 

Employment within the Swiss biotech industry remained stable, with the number of full-time equivalents (FTEs) in R&D roles consistent with 2022 levels which is notable at a time when layoffs in the industry are piling up. R&D investments slightly decreased to $2.6 billion (CHF 2.4 billion) in 2023 from $2.9 billion (CHF 2.7 billion) in 2022. Despite this decrease, the industry’s investment in innovation and research remains strong, with substantial resources dedicated to external collaborations and R&D projects​​.

This article delves into the findings of this report, providing an overview of the growth, challenges, and prospects of the Swiss biotech industry.

Swiss biotech financial landscape

In 2023, the Swiss biotech industry saw a significant increase in capital investments, raising over $2.2 billion (CHF 2 billion) compared to $1.4 billion (CHF 1.3 billion) in 2022.

Investment landscape and tendencies

The investment landscape in Switzerland is characterized by a robust and diverse funding ecosystem. The increase in capital investments in 2023 highlights a trend towards larger financing rounds, reflecting the maturity of the Swiss biotech companies. Three elements of this industry can explain its recent success:

  • Venture Capital: Venture capital remains a critical source of funding for early-stage biotech companies. In 2023, several startups secured significant venture funding, for instance, NewBiologix launched with $50 million.  Noema Pharma raised $112.6 million (CHF 103 million) in a series B round, Alentis Therapeutics $105 million in a series C round, and Rejuveron $75 million in a series B round.
  • Public market financing: Public companies like MoonLake Immunotherapeutics and Lonza leveraged the public markets to raise substantial funds, strengthening the position and appeal of established biotech firms. MoonLake Immunotherapeutics led with $453.6 million (CHF 415 million), followed by Lonza with $164 million (CHF 150 million). Other notable transactions included Oculis with $146.5 million (CHF 134 million) and Bachem with $118 million (CHF 108 million).
  • Strategic partnerships: Collaborations and licensing agreements continued to be a vital part of the investment landscape. These partnerships provided capital but also access to new technologies and markets, the most compelling exemple being CRISPR Therapeutics ans Vertex Pharmaceuticals’ collaboration to develop gene-edited therapies.

Biotech IPO landscape in Switzerland

The IPO landscape for biotech in 2023 was characterized by cautious optimism. While the number of IPOs globally decreased from 22 in 2022 to 18 in 2023, the total funds raised nearly doubled to $2.9 billion from $1.5 billion the previous year. In Europe, there were only two biotech IPOs, with Switzerland contributing one, Oculis, which went public via a SPAC transaction on NASDAQ, raising  $104 million initially and an additional $40 million in follow-on financing. 

Several factors influenced the IPO landscape, including market volatility, investor sentiment, and the maturation stage of companies. The trend toward SPAC (Special Purpose Acquisition Company) transactions reflects a growing preference for alternative routes to public markets, offering faster access to capital and greater flexibility compared to traditional IPOs​​.

Scientific and technological advancements

Switzerland’s biotech industry has been a hotspot for innovation in 2023, with several advancements reported across various fields. Switzerland’s biotech sector is deeply integrated into the global biotech community through numerous international partnerships. Swiss biotech companies and research institutions collaborate extensively with counterparts around the world, leveraging expertise, resources, and innovation. Key partnerships include collaborations with major biotech hubs in the United States, Europe, and Asia, focusing on joint research projects, clinical trials, and technology transfers. These partnerships are facilitated by Switzerland’s strong intellectual property protection, regulatory framework, and reputation for scientific excellence​​. The report gives a few examples of successful collaborations:

  • Gene editing: the company CRISPR Therapeutics has made significant strides in CRISPR/Cas9 technology, particularly in developing treatments for genetic disorders such as sickle cell disease. Their collaboration with Vertex Pharmaceuticals led to the FDA and EMA approvals of a CRISPR/Cas9 gene-edited treatment for sickle cell disease​​.
  • Novartis collaborated with the University of Pennsylvania to develop CAR-T cell therapies for cancer treatment. This partnership resulted in the development of Kymriah, the first FDA-approved CAR-T cell therapy. 
  • Roche partnered with Flatiron Health, a US-based healthcare technology and services company, to enhance oncology data analytics. This collaboration has improved Roche’s capabilities in real-world data analysis, enabling better insights into cancer treatment outcomes and facilitating the development of personalized therapies. 

Switzerland remains a leader in biotech patents and scientific publications. In 2023, the country maintained its position as one of the top global innovators with a high number of biotech patents filed. The Swiss Federal Institute of Intellectual Property reported that Switzerland holds over 21,000 active biotech patent families. According to the report, only 11% of these 21,000 patents are purely Swiss, with both inventor and applicant from Switzerland, highlighting the importance of international collaborations in Swiss biotech.

A bright future ahead for Swiss biotech

The global biotech industry has faced a downturn in funding, with a significant drop in IPOs and increased layoffs. R&D spending has seen a slight decline, which could impact long-term innovation if not addressed. Despite a favorable climate for M&A and collaborations, some companies have had to undergo restructuring or mergers to stay afloat. Examples include Evolva’s sale of business operations and Kinarus’ merger to avoid bankruptcy, reported PharmaBoardroom.

The IPO market is expected to rebound, contributing to a more favorable investment climate and Swiss biotechs might follow the example of Oculis. M&A activity remains strong in Switzerland, with for instance Basilea acquiring a preclinical antibiotics program from Spexis in January for $2.3 million (CHF 2 million). Overall the Swiss biotech industry’s outlook for 2024 is optimistic, driven by robust revenue growth, significant M&A activity, and strong, well-established international collaborations.