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Edging ahead in Q3 but still held back:

Q3 2023: longevity investment report

Table of Contents:

Introduction

What’s new in 3Q23?

3Q23 insights

Q3 deal metrics

Deals by stage

Investment by longevity domain

Closing takeaways and future prospects

Phil Newman

Editor-in-chief
Longevity.Technology

Christine Belleza

Scientific writer
Market Intelligence Unit, Longevity.Technology

Back in the 1950s, Canadian politician Jack Layton said: “… let us be loving, hopeful and optimistic. And we’ll change the world.”

Since then, of course, the world has seen many changes and innovations, and as we steer toward the end of 2023, the macroeconomic picture still looks challenging: war in Ukraine, war in Gaza, the Fed still considering interest rate hikes, and a gnarly stock market for biotech stocks.

While the S&P 500 is up 13% YTD, the healthcare components are down 4%, underperforming the S&P by the widest margin since 1999. The pain has been particularly acute in the biotech space lately, with the XBI down 12% YTD and set to fall for the 3rd straight year [1]. 

However, the longevity sector is built on optimism, breakthrough science, consolidating IP, and a growing potential about the future prospects of a world where the progression of the diseases of aging is controlled – and potentially reversed.

A new longevity drug arrives?

The world has a new longevity drug from Novo Nordisk’s Ozempic; the company makes no claims currently about its antiaging potential, but we know that there are already longevity studies underway to explore this further.

Semaglutide, sold under the brand names Ozempic, Wegovy and Rybelsus, and referred to in some markets as the ‘skinny jab’, is the weight loss drug recently approved for use in the UK National Health Service for millions of people; other governments are following.

Based around the hormone GLP-1, Semaglutide can be used for conditions other than weight loss; it has also demonstrated both efficacy in improving heart failure-related symptoms in human studies [2], as well as neuroprotective properties in mouse studies, promoting DNA repair in neurodegenerative diseases [3].

So, Ozempic heads off diabetes, cardiovascular disease and potentially neurodegenerative disease: a longevity drug in our opinion.

Novo Nordisk’s market cap outpaced the gross domestic product of Denmark, its host country; the potential for when longevity claims are matched by increased company valuation, we consider to be an exciting precursor for when longevity science matures.

We are seeing an upswing in sentiment, but we are still in the foothills of any recovery; anecdotal feedback from CEOs and investors is that it’s still a very tough market:

  • Financing for longevity companies in Q3 2023: $550m 
  • Number of deals: 34
  • Top financing location: US
  • Top financing domain: Longevity discovery platforms

The longevity sector – dedicated to extending human life, improving overall health and enhancing healthspans – remains in a constant state of evolution. As investors and stakeholders navigate this complex landscape, understanding recent trends and developments is crucial for informed decision-making.

In this Q3 report, we delve into the intricate tapestry of the longevity sector, providing a detailed analysis of its financing, deal activity and notable developments. 

In Q3 2023, the longevity sector exhibited an upswing in financial activity, with total financing reaching a substantial $550m. This marked improvement was a pleasant surprise after Q2 2023’s $290m and Q1 2023’s modest $260m. Furthermore, the deal count for Q3 2023 held steady at 34, showcasing resilience amidst a period of turbulence often referred to as a “biotech winter”.

Is Q3 2023 indicative of a potential thaw? While the answer remains uncertain, the positive shift suggests the sector’s resilience and adaptability. Additionally, while these figures are promising, it is vital to acknowledge that the investment market retains its intrinsic unpredictability. CEOs and investors we speak to are indicating improved confidence.

Q1 2022 emerged as a robust period with a substantial $4.48 billion in financing: the glory days. However, a noticeable contrast arose in Q1 2023, where financing dwindled significantly to a modest $0.26b. Similarly, Q2 2022 recorded $0.96b in financing, a figure that dipped to $0.29b in Q2 2023, signaling another notable contraction. However, amid these uncertainties, Q3 2023’s financial resurgence was indeed noteworthy, with a total of $0.55b in financing, defying recent trends and potentially indicating the longevity industry’s adaptability and its ability to rebound from temporary setbacks.

The longevity sector’s deal activity also showed interesting patterns in recent quarters. In early 2022, there was a surge with 70 deals, while Q1 2023 saw a dip to 34 deals. A similar trend continued in Q2, with 46 deals in 2022 and 33 in 2023. However, Q3 2022 stood out with 51 deals, Q3 2023 settled at 34 deals, reflecting a stabilizing trend. 

Quarter-wise, Q3 2023 saw $0.55b in financing: better.

Total financing ($b) by Quarter (2022-2023)

Fig 3. Longevity companies financing by quarter from Q1 2022 – Q3 2023 in $bn. Deal types included in the analysis are: Accelerator/Incubator, Angel, Corporate, Early Stage VC, Later Stage VC, Equity Crowdfunding, IPO, PE Growth/Expansion, PIPE, Public Investment 2nd Offering, and Seed Round. Analysis by Longevity.Technology according to Pitchbook data as of 5 October 2023 based on  812 companies.

Number of deals by Quarter (2022 – 2023)

Fig 4. Longevity companies financing by quarter from Q1 2022 – Q3 2023 in $b. Deal types included in the analysis are: Accelerator/Incubator, Angel, Corporate, Early Stage VC, Later Stage VC, Equity Crowdfunding, IPO, PE Growth/Expansion, PIPE, Public Investment 2nd Offering, and Seed Round. Analysis by Longevity.Technology according to Pitchbook data as of 5 October 2023 based on  812 companies.

Q3 financing ($b) over the past 10 years

Fig 5. Longevity companies financing activity by Q3 2013-2022 in $bn. Deal types included in the analysis are: Accelerator/Incubator, Angel, Corporate, Early Stage VC, Later Stage VC, Equity Crowdfunding, IPO, PE Growth/Expansion, PIPE, Public Investment 2nd Offering, and Seed Round. Analysis by Longevity.Tech

The deal landscape reveals some positive detail about investor appetite. Q3 2023’s average deal size, standing at $20.21m, experienced a welcome increase from Q2 2022. This growth in deal size in Q3 2023 could signify renewed investor confidence and a willingness to fund larger and potentially more impactful longevity projects.

In terms of geography, the United States remains the epicenter of longevity investment, contributing to a substantial 65% of all deals. Europe, particularly countries like France and Switzerland, contributed significantly, making up 23% of the total deals. The United Kingdom followed at 5%, while China and Canada each represented 3% of all longevity deals. This distribution highlights the global interest in longevity-related investments, with a strong focus on North America and Europe as key players in this field.

When we examine the locations of longevity companies, a clear pattern emerges. The United States stands out as the dominant player, hosting 60% of all longevity companies. Europe is home to 15% of these firms, with a presence spanning several countries across the continent. Asia accounts for 9% of longevity companies, primarily concentrated in nations like China, Japan and Singapore. Canada and the Middle East each hold 2% of these companies, while Oceania represents 1%, primarily in Australia and New Zealand. A diverse range of other countries including Brazil, Chile, the British Virgin Islands, Honduras, South Africa and Russia, collectively make up 1% of longevity companies.

Average deal size per Quarter

Fig 6. Longevity companies average deal size in $mm by quarter. Deal types included in the analysis are: Accelerator/Incubator, Angel, Corporate, Early Stage VC, Later Stage VC, Equity Crowdfunding, IPO, PE Growth/Expansion, PIPE, Public Investment 2nd Offering, and Seed Round. Analysis by Longevity.Technology according to Pitchbook data as of 5 October 2023 based on  812 companies.

Deals by location

Fig 7. Longevity companies financing activity by location in Q3 2023 as percentage of total. Deal types included in the analysis are: Accelerator/Incubator, Angel, Corporate, Early Stage VC, Later Stage VC, Equity Crowdfunding, IPO, PE Growth/Expansion, PIPE, Public Investment 2nd Offering, and Seed Round. Analysis by Longevity.Technology according to Pitchbook data as of 5 October 2023 based on  812 companies.

All longevity companies by location

Fig 8. All longevity companies by location as of Q3 2023 as percentage of total. Deal types included in the analysis are: Accelerator/Incubator, Angel, Corporate, Early Stage VC, Later Stage VC, Equity Crowdfunding, IPO, PE Growth/Expansion, PIPE, Public Investment 2nd Offering, and Seed Round. Analysis by Longevity.Technology according to Pitchbook data as of 5 October 2023 based on  812 companies.

Understanding the distribution of investments by stage is crucial. Later Stage VC continues to dominate with a significant 56% share, highlighting investors’ preference to support their existing longevity ventures. PIPE and Early Stage VC follow at 20% each, indicating strong support for publicly quoted firms and early-phase startups. Seed Round secures a 4% share, and Public Investment 2nd offering and Corporate, while both relatively low, reflects diverse funding strategies.

Deals by stage

Fig 9. Longevity companies financing by total financing by deal type in Q3 2023 as percentage of total. Deal types included in the analysis are: Accelerator/Incubator, Angel, Corporate, Early Stage VC, Later Stage VC, Equity Crowdfunding, IPO, PE Growth/Expansion, PIPE, Public Investment 2nd Offering, and Seed Round. Analysis by Longevity.Technology according to Pitchbook data as of 5 October 2023 based on  812 companies.

In Q3 2023, Longevity discovery platforms emerged as the domain frontrunner, amassing $146.63m in funding. Longevity drugs followed closely, securing $119.28m in funding, followed by Longevity Diagnostics with $103.05m. Longevity Platforms and Longevity Neuropharma also attracted substantial investments of $98.03m and $50.72m, respectively.

Total financing ($m) by domains

Fig 10. Longevity companies financing activity by domains by Q3 2023 in $m. Deal types included in the analysis are: Accelerator/Incubator, Angel, Corporate, Early Stage VC, Later Stage VC, Equity Crowdfunding, IPO, PE Growth/Expansion, PIPE, Public Investment 2nd Offering, and Seed Round. Analysis by Longevity.Technology according to Pitchbook data as of 5 October 2023 based on  812 companies.

Longevity investment trends

A historical analysis of the longevity industry’s financing journey reveals distinct waves of growth and retractions, starting with a modest $0.538b in investments in 2013. Subsequent years demonstrated marked fluctuations: 2014 ($4.06b), 2015 ($3.97b), 2016 ($1.68b), 2017 ($1.60b), 2018 ($3.29b), 2019 ($2.96b), 2020 ($4.15b) and 2021 ($7.94b) respectively. By 2022, despite market fluctuations, funding remained substantial at $7.18b, underscoring the enthusiasm for longevity-related ventures. Aside from this, the number of deals saw a steady increase, reaching 228 in 2022.

Annual Total Financing in the last 10 years

Fig 1. Longevity companies financing activity by total financing in 2013-2022 in $b. Deal types included in the analysis are: Accelerator/Incubator, Angel, Corporate, Early Stage VC, Later Stage VC, Equity Crowdfunding, IPO, PE Growth/Expansion, PIPE, Public Investment 2nd Offering, and Seed Round. Analysis by Longevity.Technology according to Pitchbook data as of 5 October 2023 based on  812 companies.

Number of deals in the last 10 years

Fig 2. Longevity companies and number of deals in 2013-2022 in $bn. Deal types included in the analysis are: Accelerator/Incubator, Angel, Corporate, Early Stage VC, Later Stage VC, Equity Crowdfunding, IPO, PE Growth/Expansion, PIPE, Public Investment 2nd Offering, and Seed Round. Analysis by Longevity.Technology

In Q3 2023, the longevity industry’s performance beat expectations and indicated a potential thawing of the icy “biotech winter”. Notably, recent government approvals of Wegovy and Ozempic for weight loss therapeutics have ignited interest in potential applications for antiaging drug development. This development hints at opportunities beyond the weight management arena.

Aside from this, artificial intelligence (AI) development platforms continue to wield a profound influence, propelling groundbreaking advancements in the longevity sector and firmly establishing its role as a linchpin in shaping the industry’s future.

However, it is important to temper this optimism with a dose of realism, given the unpredictable nature of the investment market. While historical trends offer guidance, the market often takes unexpected turns, as demonstrated by recent global events.

1. Rosenwald, L. A. (2023, August 2). Opinion: Is the biotech winter beginning to Thaw?. BioSpace. 

https://www.biospace.com/article/opinion-is-the-biotech-winter-beginning-to-thaw-/

2. Cucci, D. (2023, August 8). Understanding Ozempic, Wegovy, and weight loss medications. NewYork-Presbyterian. 

https://healthmatters.nyp.org/understanding-ozempic-wegovy-and-weight-loss-medications/

3. Leerink Partners ECM Team (2023, September 29). Navigating the complex terrain: Healthcare and biotech markets in Q3 2023. Leerink Partners. https://www.leerink.com/articles/navigating-the-complex-terrain-healthcare-and-biotech-markets-in-q3-2023/ 

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