China's Healthcare Investment and Financing "Ten Years of Great Changes"

According to the statistics of InvestGO database, the investment trend in the medical and health field has generally increased since 2013, with the cumulative number of events in the past 10 years approaching 14,000, the primary market financing amount of 970 billion yuan, and the secondary market fundraising exceeded 1.
1 trillion yuan
.
The maximum number of incidents in 2021 was 2,500, 13 times that of 2013, and the amount disclosed exceeded 480 billion, 30 times
that of 2013.
After 2022, the overall market environment is sluggish, the overall investment scale has declined, and capital investment has become more cautious
.

Source: InvestGO

Investment institutions tend to be cautious, and the proportion of "huddle heating" has increased
.
According to the statistics of InvestGO database, nearly 2,000 institutions have poured into the industry in the past decade, and more than 1,800 active institutions will be active in 2021, an increase of more than 10 times
compared with 2013.
The proportion of institutional single investment is getting lower and lower, and the proportion of "huddle heating" is increasing
.

Source: InvestGO

Entrepreneurial projects in the industry are increasing year by year, but only a few
projects have successfully reached the later round.
According to the InvestGO database, the number of financing projects from 2013 to 2022 exceeded 7,300, of which the number of entrepreneurial projects reached an all-time high of 2,054 in 2021, 12 times
that of 2013.
The numbers on the surface seem promising, but the numbers behind them are thought-provoking, of these 7,300 projects, only 58% have raised one round, while only 6%
have raised 5 rounds or more.

Source: InvestGO

The inversion of valuation in the primary market is obvious
.
According to the InvestGO database, the amount of the first round of financing has been on the rise since 2017 and has fallen to the level
of 2019 from 2022.
From the first round of valuation, it reached an all-time high of 550 million yuan in 2020 and has since begun to decline
.

Source: InvestGO.

The first round of financing refers to the first round of financing that actually occurs of the project, not limited to seed round or angel round

High-tech, high-barrier early-stage projects swim against the current in the capital "winter
".
The proportion of seed/angel events gradually decreased from 61% in 2014 to 25%
in 2022.
The proportion of Pre-A~A+ round events increased from 5% to 26%.

Source: InvestGO

In the past decade, the domestic capital market can be divided into three stages
: follow-up, outbreak and pullback.
From 2020, the trend of the primary and secondary markets is basically the same
.
The capital market has entered a correction period since mid-2021, with A-shares and Hong Kong stocks both broken, and the liquidity of the secondary market has decreased, which in turn has affected the financing and pricing
of the primary market.
In such an environment, industrial investment is expected to play an important value
.

Source: InvestGO

As the overseas medical and health industry has developed for many years, in the process of continuous merger and reorganization, up to now the industry has formed a relatively distinct competitive pattern, the head Pharma enterprises have the strongest
competitiveness due to their mature global sales team and rich pipeline 。 Biotech companies are mainly driven by technology, only a few products are under research or commercialization, and the gap with the head enterprises is large, and at the same time to build a commercialization team also requires a lot of funds, from a flat Biotech company to a Pharma enterprise integrating research, production and marketing is more difficult, so more overseas Biotech companies choose to hand over commercialization to more powerful Pharma companies
.
It has become a major trend
for multinational MNC enterprises to expand their pipelines and accelerate their industry layout through the acquisition of high-quality assets.

Source: InvestGO

Statistics from the InvestGO database show that the overall scale of domestic industrial investment has increased year by year, and industry integration has accelerated
.
In the past ten years, the number of industrial investment events has reached more than 3,600, and more than
1,300 foreign investment enterprises have been involved.
Large companies accelerate their industrial layout and rapidly enrich their product pipelines
through investment and acquisition.
As Biotech's valuation returns to rationality, domestic large pharmaceutical companies are expected to obtain high-quality pipelines and platforms with sufficient cash flow to reserve energy
for their transformation and later development.