Finding the next big impact investing opportunity in the UK biotech sector

By Alexandra Martinez, Co-Founder and Chief Visionary Officer of Clota Värde

The global burden of Alzheimer’s disease is staggering. With over 55 million people across the world affected by dementia-related neurodegeneration, and one in three people born in the UK this year developing it in their lifetime[1], the need for effective treatments and early diagnosis has never been more pressing.

Although current treatments for the disease are limited in effectiveness, recent advances have given hope to patients and their families. Clota Värde is at the vanguard of this progress, helping to secure funding for new diagnostic and treatment methods that will revolutionise the way we support people living with Alzheimer’s.

With such dramatic innovation set to change millions of lives, the sector is ripe with opportunity for investors to not only generate strong returns but also contribute to addressing some of the most pressing healthcare challenges of our time. Moreover, with the UK government’s recent commitment to making the country a life sciences superpower and global biotechnology leader by 2030[2], the potential for investment in the sector has never been greater.

A growing market

The biotech industry is projected to be one of the fastest growing sectors in the global economy, with the market size expected to reach one trillion dollars in the coming years. The industry is being fuelled by the growing demand for chronic diseases such as Alzheimer’s and cancer, especially as the global population ages[3], creating an attractive investment opportunity for biotech companies working on research in these areas.

The emergence of new technologies such as artificial intelligence (AI) and machine learning (ML) has led to more interest from investors in biotech research and development – the surge in venture capital funding reflects this trend, with over $52 billion invested between 2019 and 2021[4], evidencing an increasingly confident investor base which recognises short-term returns alongside long-term value creation potential associated with biotech investment.

Neuro-Bio is a prime example of this trend. Having successfully secured early-stage fundraising to the tune of £10.4m, Clota Värde is now supporting Neuro-Bio mavens in an ambitious £10m Series C fundraise. Now is an opportune time for investors to tap into lucrative and innovative enterprises while contributing towards revolutionary treatments for chronic diseases at scale – something which will have lasting effects on generations to come.

Returns as well as impact

As the prevalence of Alzheimer’s and other neurodegenerative diseases continues to increase, placing a mounting strain on global healthcare systems, the urgency for developing effective and efficient diagnostic tools and treatment strategies becomes increasingly critical.

The significance of investment into the biotech industry cannot be overstated as it not only grants investors access to ground-breaking research and development, but also enables them to actively participate in driving scientific breakthroughs.

By funding biotech research through investment, impact-focused investors contribute to the creation of innovative solutions that address the most urgent healthcare challenges of our time. This financial support is crucial to accelerating the progress of cutting-edge medical technologies, therapies and treatments, ultimately improving global health and transforming countless lives.

In this way, investing in the biotech sector is not just a sound financial decision, but also a powerful means of fostering positive change in the world.

Investing in biotech also offers a unique value proposition for impact investors, particularly in such a dynamic and rapidly growing sector that has the potential for significant long-term growth. Between January 2020 and January 2021, the average share price for European and US biotech’s increased at more than twice the rate of the S&P 500, highlighting the potential of this sector for investors[5]. By incorporating biotech investments into their portfolio, investors not only gain access to cutting-edge research but also achieve greater portfolio diversification, hedging against market volatility while enjoying minimal downside risk compared to other investments. Early investment in this burgeoning field allows investors to capitalise on innovative technologies before they enter the mainstream market, raising the likelihood of higher returns over time.

Influencing global health outcomes

Clota Värde is committed to facilitating investments in innovative solutions that can significantly improve healthcare outcomes worldwide. With the global burden of chronic neurodegenerative diseases on the rise, sustained investment into the biotech sector is critical for providing effective treatments and therapies. Investment into this area not only drives forward advances in science and medicine, but also has a tangible impact on societies around the world; only with sustained investment will the industry be able to effectively and efficiently create lasting positive effects on global health outcomes.

[1] https://www.alzheimers.org.uk/about-us/news-and-media/facts-media

[2] https://www.gov.uk/government/news/plan-to-forge-a-better-britain-through-science-and-technology-unveiled

[3] https://www.alz.org/alzheimers-dementia/facts-figures#:~:text=Unless%20a%20treatment%20to%20slow,out%2Dof%2Dpocket%20spending.

[4] https://www.mckinsey.com/industries/life-sciences/our-insights/what-are-the-biotech-investment-themes-that-will-shape-the-industry

[5] https://www.mckinsey.com/industries/life-sciences/our-insights/whats-ahead-for-biotech-another-wave-or-low-tide