2017 European Life Sciences Report

The European Life Sciences Market – looking forward to continued growth

Earlier this month, Horton International (UK) launched its 2017 European Life Science Report, published following our annual survey among the movers and shakers within the European Life Science sector. Our report last year, suggested a fall-off in optimism, especially when a number of questions compared it to the high-point of 2015-2016. Also, that survey was carried out around the same time as the UK Brexit vote, which may have made some of the UK respondents a little more cautious.

The outcome of this year’s survey seems to suggest that the fall off in optimism was merely a temporary hiatus, with practically all of our indicators suggesting that people think the sector is in good shape, and investment will continue to be healthy. It is interesting to note that not a single respondent felt there would be a decline in employment in the sector, and the “confidence indicator” (marks out of 10) rose from 6.5 last year to 7.4 this year, only just short of the record high figure of 7.7 in
2015. We could conclude that the sector has been (and remains) in good shape since 2014, and that 2016 was merely a year for everyone to draw breath.

The shadow of Brexit

Given that it is just over a year since the UK voted to leave the EU, it is not surprising that Brexit was raised as an issue, particularly for the UK respondents. Having seen the “confidence indicator” rise back up to 7.4, however, it does suggest that most of the people questioned do not expect Brexit to have a major impact on the growth of the industry. This was not the view of all the respondents, with one UK colleague saying “Brexit is a major challenge to the Life Sciences Industry, particularly if the “no deal with EU is preferable to a bad deal” rhetoric is fulfilled. I’m not convinced that the Government fully understands the challenge to medical technology companies of a Brexit deal that does not offer the same access to harmonisation of regulations, patents, grant funding, free movement of skilled people and collaboration with EU centres of clinical and academic excellence as presently enjoyed in this industry sector.”

The main findings in this year’s survey are as follows:

  • There is a belief that investment into the sector is likely to remain healthy, and potentially grow, over the coming 12 months.
  • Investors will be looking for new opportunities, as well as managing their existing portfolios.
  • IPOs will continue to be a viable route for companies to raise money in the coming year.
  • There is a general feeling that achieving an exit will prove to be no easier or no more difficult than in previous years.
  • There has been a continuing shift back to therapeutic proteins, with areas such as immune-oncology remaining one of the hot areas. The other area creating interest is around personalised medicine and digital health.
  • It is felt that there will be a continued increase in employment in the sector.
  • There is a general consensus that the European Life Sciences sector is robust and, notwithstanding a global crisis such as a financial crash, will continue to offer good returns for investors.

For a copy of the full report, please contact Paul Edwards at edwards@hortoninternational.com.

Paul Edwards
is the Managing Partner, Global Healthcare at Horton International, leaders in the Executive Search community.