Sector-Leading Companies to Dominate Healthcare Fundraising in New Year Despite Economic Uncertainties - Seite 2

Medical Devices

We project first-financing activity to involve a combination of smaller 510(k) pathway deals suitable for corporate M&A and larger market PMA-pathway focused deals that will likely have corporate investment from the outset. Imaging companies utilizing hardware/software solutions and neurostimulation technologies are expected to remain active areas of investment. 2024 will be a challenging year for many mid-stage companies that have depleted their insider rounds and find limited interest from new investors. In contrast, companies involved in later-stage pivotal trials and commercialization deals with strong markets and clinical data/approval are expected to secure a mix of traditional VC and growth funds. The deal-value increase in private M&A has started to reinvigorate the later-stage scene. Recent cases of early-stage deals achieving rapid, large exits and later-stage valuation resets that later result in robust M&A deal values have helped bring investors back to the table.

DX/Tools

We anticipate challenges to persist in first-financing activity, as many investors in the dx/tools sector are focused on supporting their existing portfolio companies or exploring opportunities in later-stage commercialization plays. Technology focused on gene and cell therapy production and manufacturing should remain a strong area of investment. Companies in the computational biology sector, particularly those focused on discovery or development processes, are positioned to sustain increasing investor interest. We also project that many of these companies will likely pivot from providing platforms or engaging in discovery to developing their own assets. The emergence of IPOs in 2024 appears unlikely, except in one-off scenarios. Thus, many companies with high private valuations from 2020-2021 will need to secure private new investor-led financing. Despite the likelihood of valuation re-sets for many companies, the underlying strength of the technologies is expected to attract new investor interest, likely led by traditional VCs.

The HSBC Venture Healthcare Report was written and produced by HSBC Innovation Banking’s Life Science and Healthcare Team, which serves the innovation economy by providing products and solutions to early-stage companies with growth ambitions.

“The insights in our report provide an overview of investment activity, valuations and step-ups for venture-backed healthcare companies, supported by deep-sector expertise, historical perspectives and data-informed predictions,” said Katherine Andersen, Head of Life Science and Healthcare, HSBC Innovation Banking. “We are committed to supporting the innovation ecosystem by leveraging our industry experience and the strength and stability of HSBC’s global platform.”