Biopharma could reap benefits from SVB UK acquisition

Following the collapse of Silicon Valley Bank (SVB), HSBC’s acquisition of Silicon Valley Bank (SVP) UK may offer new opportunities for biopharmaceutical companies, according to data and analytics firm, GlobalData.

“The access to increased capital and international presence that HSBC provides could allow for the potential for biopharmaceutical companies to improve investment in the development of therapies,” Sharon Cartic, Associate Director of Business at GlobalData commented.

GlobalData Pharma Intelligence Center Deals Database found:

• SVB Financial Group and its subsidiaries were involved in more than $1.4 billion in total venture financing raised from 2010 to 2022 for drug development
• In 2018 alone, the company invested over $400 million in venture financing.

“2020 was a record year for venture financing; however, 2021 and 2022 saw less investment as recovery from the COVID-19 pandemic, the Ukraine crisis, and inflation caused market volatility, which resulted in a less favourable environment for risk-averse investors across the biotech industry,” Cartic explained.

Impact of SVB UK acquisition on European biopharma companies

One Netherlands-based biopharmaceutical company anticipated that the acquisition of SVP UK would allow access to its $19 million deposit and not experience losses, noted GlobalData.

The analytics group added that other European biopharmaceutical companies also expect to recover their deposits. A Danish pharma company developing peptide-based medicines, expects to recover its $23.4 million in deposits.

Future predictions

“It remains to be seen how the void left by the collapse of the bank will be filled and whether there could be a slowdown in venture debt,” acknowledged Cartic.

“However, the acquisition of Silicon Valley Bank UK by HSBC could provide greater access for biopharmaceutical startups to international markets and global networks of investors. This could open doors to greater biopharmaceutical and startup company collaborations in driving innovation for drug development,” Cartic concluded.