German biotechnology sector on upswing

Germany's biotechnology sector says it is optimistic going into the new year and is forecasting further growth in 2016. The results of the latest survey taken by the association BIO Deutschland in cooperation with the trade magazine transkript indicate that a majority of the companies are planning to employ more people and increase investment in research and development (R&D).

Laboratory assistant investigates an infection
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The positive outlook is directly related to clearly improved finances within the sector. More than two-thirds of the companies surveyed say business conditions are favorable and nearly 60 percent say they expect further improvement in 2016.

Last year, equity capital investments were around EUR 553 million. That is 38 percent higher than they were in 2014 and the highest they have been in the sector since 2010. Venture capital investments in particular were on the up, too. In fact, at 53 percent, they more than doubled on the preceding year. Private investors put EUR 263 million into German biotechnology last year as well.

BIO Deutschland Chairman of the Board Peter Heinrich summarized, "The German biotechnology sector will continue its growth. Pharmaceutical partnerships and a greater role played by international investors will increase its importance, emphasizing its significance for Germany as a location for business." He added that the growth and internationalization of the sector would continue to require political support.

The firms surveyed in 2015 were much more positive about new investment, staff increases and research and development than they were the preceding year.  These plans could have a positive effect on the export and internationalization activities of German biotech firms.

New opportunities are also likely to come from the interplay between biotechnology and digital health. This interaction is becoming more significant for forward-looking German firms as personalized medicine grows in importance.

The Federal Ministry for Economic Affairs and Energy’s (BMWi) German Accelerator Life Sciences (GALS) program has since the end of last year been supporting German high technology and life sciences start ups in Boston as they search for investors in the US. The names of the first four companies selected for the GALS program in Boston were announced this month at the JP Morgan Healthcare Conference in San Francisco. These are the Cologne-based biosystems company AYOXXA, PEPperPRINT, an innovative biotechnology company in Heidelberg, Personal MedSystems of Frankfurt-Main and the Hamburg-based company, Sonormed.