Posts tagged biotech

Notes from Cleantech Panel Discussions at BioFinance

As mentioned in my prior post, there was a first at BioFinance this year – a panel on Cleantech, and a number of Cleantech presenting companies.

The discussion began with the question: Is cleantech the future of life science? (maybe for investors looking for quicker and more reliable returns on investment?! take a look where the dollars are going! The Cleantech sector is now outperforming other sectors, it is the best sector in US stock market and was up 46% last year.

Deloitte is compiling the “Green 15″, from 150 candidates who have submitted profiles this year. Interestingly, some companies seem to be waivering between life sciences and cleantech – they just can’t decide where they are or where they should be. After all, if they call themselves a life science company, investors approach cautiously … but that’s just me being cynical.

Susan McLean, a Senior Manager of Business Development at the TSX, gave an interesting overview of the sector. The TSX had 94 cleantech issues in 2007, and it is growing. In fact, there was a tripling of activity from 2005 to 2007, progressing well in 2008; there were 2.5 billion shares traded in 2007. It is looking at pure-play companies and integrated companies. Some sub-sectors of listed companies include solar, wind, hydro, geothermal, fuel cell, waste to energy, and others. Now, for the best part – companies even at the $50 million value are getting analyst coverage – something unseen for many “small” companies on US exchanges.

Another panelist was a well-recognized member of Bay Street, Steven Winokur from Canaccord Adams. A few high-level points came out of his talk. He recognized Cleantech to be the best performing sector. There are a number of biotech applications in Cleantech that he mentioned:

  • Agriculture: genetic crop technologies, organic fertilizers, water/waste remediation
  • Nanotechnology for desalinization
  • Biofuels – lignol, syntec biofuel
  • Green Building – a noted possibility

Canaccord Adams puts out a newsletter with quality research reports each month, and they are a highly recommended read by Duncan Stewart, from Deloitte.

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Climate is Changing Now, Business Opportunities

The latest report from the Intergovernmental Panel on Climate Change (IPCC) is one of the first to use observations of the Earth’s climate, as opposed to theoretical models to predict what might happen in the future. The data shows that climate change is real and is happening right now.

Source: IPCC. (Click to enlarge)

Take a look at the different key areas being affected here: water, ecosystems, food, coasts and health. There might be some business opportunity in the new wave of cleantech, biotech, or Blue Gold!

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Pharma and Biotech Update

Pharma seeking patents on old drugs, and a 40x increase venture capital spent on biofuel-related companies:

An article from CNN talks about big pharmaceuticals looking to acquire new patents on old drugs to fend off generic competition. They are using the creative minds of their in-house, legal teams to try to “work the system” to their advantage… see Big Pharma teaches old drugs new tricks for the full story.

On the biotech side, there was a report today that discussed a 4000% year-over-year increase in the amount of venture capital spent on biofuel companies from 2005 to 2006. The majority of the funds were geared toward genetically engineering enzymes in the production of bioethanol.

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Biofuel Investment Jumps 4000%

Dramatic increases in Venture Capital in the area of Biofuels was realized in 2006. I just caught wind of an article from the Associated Press, Biotechnology that highlights one of the largest one-year increases in venture-backed funding I have ever seen.

An interview at Associated Press with Ron Pernick, who co-founded Clean Edge (a company tracking venture capital investment), said that “Venture capital investment in biofuels has increased from less than $1 million in 2004 to $20.5 million in 2005 to $813 million last year [in 2006]. Much of that investment is flowing to biotechnology companies that genetically engineer microbes that produce enzymes needed to break down crops into alcohol.” If we’re cracking out the calculator, that’s about a 4000%, or 40x increase year-over-year! Now, it is extremely helpful to the venture investors, and the companies, that the US Department of Energy (DoE) has awarded $385 million over the last four years (to six companies, albeit) to develop ethanol.

Please see Biofuels Spark Biotech Rally for the full article.

Some other relevant links include: Biotechnology Industry Organization, and US DoE.

Are you investing an a Biofuel company yet? Maybe you should jump on that wagon before it leaves town…

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