Foreign investors, companies and highly skilled employees continue to find their way to Belgium, thanks to its renowned life sciences and biotech ecosystem. Representing an impressive 24% of the total European market value, Belgium may be relatively small in size but it is well ahead of other European countries such as Denmark (21%), Germany (18%) and Spain (9%) when it comes to biotech business success.
Just like in previous years, Belgium’s biotech success in Europe over the past year was largely due to major players such as UCB, Argenx and Galapagos. These allowed the stock market value to rise sharply with the development of promising medicines. For example, Argenx raised over EUR 780 million, driven by the positive phase 3 clinical results of one of its antibody-based treatments for a rare autoimmune disease. This was the largest capital increase ever for a publicly traded European biotech firm.
However, smaller Belgian biotech companies – totaling a market value of under EUR 1 billion – also upped their games. As such, they saw their joint market value rise from EUR 2.2 billion to 2.6 billion in the past year, claiming 4th place in Europe. Among these smaller biotech players, the growth in Belgium’s market share can be attributed mainly to Iteos and Hyloris. Other important players include Bone Therapeutics, MDX Health, Biocartis and Mithra. Furthermore, the average market value of smaller Belgian companies has increased from EUR 171 million to EUR 259 million, putting Belgium in 2nd place in Europe.
“Belgium remains Europe’s biotech Valhalla,” explains Nathalie Van Den Haute, head of Equity Capital Markets within the corporate finance team of KBC Securities. “The biotech sector, like many other industries, experienced a sharp downturn in March 2020 due to the COVID-19 crisis. However, life sciences companies have done very well in recent months. Investors see the sector as a safe haven. Not only are the valuations of biotech companies less driven by short-term turnover fluctuations, but the crisis also showcased the importance of the sector very clearly. It’s therefore no surprise that biopharma indexes outperformed general indexes such as Bel20 and S&P 500. We expect 2020 to be a record year for Belgian fundraising.”
In fact, there has been a positive dynamic in Belgium and Flanders as a region for some time now when it comes to the growth of public biotech firms and the founding of new life sciences start-ups. Over the last 5 years, over 60 local start-ups came into existence. “In spite of COVID-19, the first half of 2020 has been very strong in terms of capital rounds as well,” confirms Kenneth Wils of PMV, Flanders’ investment fund.
During VIB and flanders.bio’s ‘State of the Union' event, which announces new biotech developments while analyzing Belgium’s and Flanders’ position within the European landscape, some new companies were given the chance to introduce themselves. This year, the opportunity went to six biotech companies that have recently set up locations in Flanders to benefit from the region’s successful track record in life sciences: Asylia Diagnostics, Augustine Therapeutics, Montis, MRM Health, AgomAb Therapeutics and ExeVir, the recent VIB spin-off working on a COVID-19 treatment.
“More and more of our companies are seen as world leaders in their fields – and we should be very proud of that,” says Dirk Reyn, chairman of the board of directors of life sciences sector federation flanders.bio. “In addition, foreign life sciences companies are increasingly interested in establishing themselves in our region, and we are also seeing more and more large foreign companies deciding to invest here. Our ‘Biotech Valley’ remains unique due to the high concentration of critical players in a relatively small area, ranging from biotech firms to large pharma companies and digital health experts. All of this is driven by knowledge institutions such as imec and VIB as well as by the growth of AI in Flanders.”
“Other important elements are the attractive local environment for testing new products and the presence of a highly skilled workforce alongside experienced biotech investors,” Reyn adds. “And let’s not forget our central location in Europe and our region’s long-standing experience in the life sciences industry, as well as the high availability of financial and political support from the government.”