Q2 Biopharma Recap

 As the second quarter of 2024 comes to a close, the biopharma landscape continues to evolve with dynamic shifts in funding, clinical trials, and innovative developments. Zymewire is back to provide you with a comprehensive digest of what's happened in Q2, to help inform smarter business decisions going forward.

Similar to our Q1 Biopharma Recap, we'll examine cumulative funding totals by region, upcoming clinical trial plans, FDA drug approvals, and more. This time, we've added dimensions to our analysis such as therapeutic focus area and company size to ensure actionability across the board. 

Skip to a topic:

• Cumulative Funding by Region
• FDA Drug Approvals
• Funding by Company Size
• Funding by Therapeutic Focus
• Study Initiations and Closeouts
• Upcoming Clinical Trials
• Cell & Gene Therapy Future Plans
• Active Companies by Highest Phase of Development
• Newly Identified Biotechs

Cumulative Funding by Region

Typically, the first and last quarters of the calendar year are the strongest for funding within the biopharmaceutical landscape. So far this year, that trend has held true, with a 14% decline in total funding globally and Q1 funding at $37.22 billion (USD). Figure 1 displays cumulative funding totals for the second quarter of 2024, for companies in North America, Europe, and APAC. 

Figure 1:

New FDA Drug Approvals

In the first quarter of 2024, the FDA approved 10 new drugs. In Q2 there were also 10 new drugs approved. 

Figure 2 displays newly approved drugs alongside the API and approved use. 

Global Funding by Employee Count

Funding headlines are dominated by big-ticket deals, making it easy to get tunnel vision and miss out on prime opportunities that aren't discussed. In the first half of 2024, just about 50% of all funding has gone to biotech & pharma companies with 100 employees or less. Simply put, service providers targeting this demographic of sponsor companies have a much larger runway (1388 companies), and will face far less competition when they reach the RFP stage.

Figure 3 displays the funding landscape in 1H 2024, broken down by company size. The chart includes the percentage of total funding and number of companies present in each grouping. 

Figure 3:

 Global Funding by Therapeutic Focus

Many service providers, namely CROs, will segment and size their serviceable addressable market based on therapeutic area. To do so, it's important to stay on top of which therapeutic areas are receiving the financial support needed to progress through the drug development cycle. Figure 4 breaks down the top 10 therapeutic areas by total funding throughout the first half of 2024. 

Figure 4:

One notable observation is that Infectious Diseases fall outside of the top 10, coming in at around 2.5% of the total year-to-date funding. Due to COVID, infectious diseases have been a highly active therapeutic area of research for the past few years and we're now starting to see a slowdown. 

Study Initiations & Closeouts

The clinical development process becomes more expensive, lengthier and complex as you progress further along in the journey. Naturally, it becomes increasingly difficult to get to the next stage due to these additional hurdles. Historically, about 70% of Phase 1 trials will move to Phase 2, and 33% will then move forward to Phase 3. In the grand scheme of things, this is a safe estimate - however, newer, less researched technologies will innately have longer development times and lower rates of success.

Looking at study initiations and closeouts can help paint a picture of the clinical trial landscape, and how companies are fairing. Normally, you'd expect the numbers (Initiations and Closeouts) to taper off as you move forward from Phase 3.

Figure 5 displays the total number of study invitations and closeouts that occurred globally during Q2 2024, broken down by phase.

Figure 5:

Interestingly, there were more Phase 3 initiations than Phase 2. As a result, we might expect to see fewer Phase 3 initiations 18-24 months down the road. 

Upcoming Clinical Trials by Region

Getting in front of clinical trials is challenging, but necessary to give yourself the best chances of landing new opportunities... especially with organizations where there's no existing relationship. 

For service providers, clinical phase of development is another effective way of sizing your serviceable addressable market, perhaps more so than therapeutic area or molecule type. 

Why? Timing. 

An oncology-focused biotech with plenty of cash might seem like a prime prospect. But if they're already planning their Phase 3 trial, chances are you're too late, regardless of your offerings. 

Figures 6 through 8 break down the number of companies that have disclosed upcoming clinical trial plans, broken down by phase and region. 

Figure 6:

Figure 7:

Figure 8:

Cell & Gene Therapy: Future Development Plans

The Cell & Gene Therapy space is the most discussed research area in the biopharma field. With 37 approved products, CGTs are a prime example of newer, more complex, and less-researched technologies within the clinical trial arena. As time progresses, further research and experimentation will allow biotechs to build a better understanding of these technologies, leading to reduced development timelines and more successful trials. 

Figures 9 and 10 show future development plans for gene and cell therapies, respectively. 

Figure 9:

221 Companies had preclinical/non-clinical study activity relating to a gene therapy during Q2. 

Figure 10:

134 Companies had preclinical/non-clinical study activity relating to a cell therapy during Q2. 

Active Companies by Highest Phase

Yet another market sizing exercise is to observe the activity of drug developers based on their highest phase of development. Just under 6000 biopharma companies had some level of activity during Q2, 36% of them have yet to reach the clinical trial stage. 

Preclinical service providers are still in a great position halfway through the year. Early-stage biotechs are highly active and possess half of the total funding that's been awarded year-to-date. Figure 11 displays the number of companies with activity in Q2, broken down by their highest phase of development. Figure 12 compares the number of new biotechs Zymewire has identified in Q1 vs. Q2.

Figure 11:

Figure 12:

As always, thank you for reading! We'll be back again in a few months for our Q3 recap.