Predictions for Belgian Biotech in 2020

January 22, 2020 Article BioVox

With the Belgian biotech landscape blooming, BioVox reached out to some of the investors in our network to see what their predictions are for the coming year. From trends to companies to keep an eye on, here’s their take on 2020!

Belgian biotech has been gaining momentum and seems poised to take the new year (and the new decade) by storm. This is unsurprising, as 2019 was an action-packed year with both ups and downs. Before we get into the predictions for 2020, let’s have a quick look back at some major events from 2019.

Highlights and lowlights of 2019

Trends-wise, immuno-oncology is still going strong with personalized medicine and digital health featuring heavily as hot topics. Of the deals and licensing agreements made last year, the blockbuster $5 billion-dollar deal between Galapagos and Gilead took the cake. There was a lot of money raised for companies, new and old, including €30 million by Confo Therapeutics, €35 million by Imcyse and a €47 million by Promethera.

On the Brussels Stock Exchange, Galapagos and Argenx did exceptionally well. The combined stock market value created in 2019 by these two companies alone came to €10 billion. No wonder Galapagos founder and CEO Onno Van de Stolpe was chosen as the Trends Manager of the Year 2019. However, not all companies were so lucky: although things went well overall, there were some smaller biotech companies that really struggled last year. ASIT biotech, for example, is scrambling for survival after the company’s lead drug candidate, an immunotherapy product to treat grass pollen allergy, failed its Phase III trial.

But that is the way of biotech businesses: they are high risk, high reward. Nobody knows this better than investors, who put a lot of thought and effort into trying to predict which companies will rise to the challenge and which will fail. BioVox spoke with V-Bio Ventures and KBC Securities, to pick their brains on the coming trends and companies to keep an eye on in 2020. So, without further ado, let’s jump into some predictions for the year to come!

What trends will we see in 2020?

At KBC Securities, we expect oncology to remain front and center in 2020… This is part of a larger trend in the pharmaceutical industry, already ongoing for many years, and which we believe will continue into 2020.
– Lenny Van Steenhuyse, KBC Securities

When asked what new or continuing trends we’ll be seeing in biotech and healthcare this year, Lenny Van Steenhuyse (Financial Analyst (Biotech & Pharma) at KBC Securities shared the following ideas:

“At KBC Securities, we expect oncology to remain front and center in 2020. With Sanofi deprioritizing any further efforts in diabetes, and starting M&A in the oncology space, we have yet another big pharma pivoting towards cancer care. This is part of a larger trend in the pharmaceutical industry, already ongoing for many years, and which we believe will continue into 2020.”

“Additionally, rare diseases are continuing to attract significant R&D investments. It is a space where novel technologies such as gene therapy have delivered compelling proof-of-concept results. In 2019, gene therapy was often in the spotlight, with Novartis’ launch of Zolgensma and several multi-billion-dollar acquisitions in the gene therapy landscape. It will be most interesting to see how 2020 follows up with new clinical data and how the societal discussion on pricing around these therapies will progress.”

“Of course, this focus on oncology and rare diseases often comes at the cost of other treatment areas. Cardiovascular diseases, neurology and infectious diseases are all areas with high clinical needs and/or societal impacts, but unfortunately remain under-investigated in the current R&D landscape.”

We foresee the usual strong rate of biotech start-up creation here in Belgium. This includes the likely creation of new cell- and gene therapy start-ups, as well as the continuation of new investments into immuno-oncology.
– Christina Takke and Willem Broekaert, V-Bio Ventures

Christina Takke and Willem Broekaert, both co-founders and Managing Directors of V-Bio Ventures, agreed with the KBC Securities take on trends and had some further insights of their own:

“We foresee the usual strong rate of biotech start-up creation here in Belgium. This includes the likely creation of new cell- and gene therapy start-ups, as well as the continuation of new investments into immuno-oncology, albeit at a lower level as compared to previous years.”

“We also believe there will be strong private follow-on rounds in biotech funding, and that we’ll be seeing some exciting Series B and C rounds.”

What will be some major companies to keep an eye on?

Accurately predicting the performance of a company for any stretch of time is nigh on impossible. There are many factors to take into account, and the unpredictability of clinical trials and unforeseen events can throw even a strong candidate off balance. However, there are always indicators for companies that look set to shine.

Galapagos has had a stellar year in 2019 and 2020 will remain eventful. The coming year will be peppered with clinical readouts throughout their pipeline… However, a word of caution: it is likely that not all of these readouts will be positive.
– Lenny Van Steenhuyse, KBC Securities

Based on their performance in 2019, KBC Securities believe that the following companies will likely continue to do well in the coming year:

“On the public markets, Argenx is set for an eventful year.” Van Steenhuyse tells us. “The company has already disclosed the third positive Phase II data for their lead candidate efgartigimod, in the autoimmune disease pemphigus vulgaris. The first Phase III data for efgartigimod, in myasthenia gravis, are expected mid-year. Positive data from this trial would represent a major de-risking event for the drug and for the company as a whole.”

Van Steenhuyse also commented on Belgium’s darling, Galapagos:
“Galapagos has had a stellar year in 2019 and 2020 will remain eventful. The coming year will be peppered with clinical readouts throughout their pipeline, including various Toledo compounds, Filgotinib in ulcerative colitis, GLPG1972 in osteoarthritis and GLPG1205 in IPF. These are all readouts to get excited for. However, a word of caution: it is likely that not all of these readouts will be positive, bringing some volatility back into the Galapagos stock.”

Oxurion faced some challenges last year, with poor results for their phase II trial in THR-317. However, in 2020 they have already published positive phase I results for THR-687 and their stock is climbing.
– Christina Takke and Willem Broekaert, V-Bio Ventures

Takke and Broekaert from V-Bio Ventures agree with Van Steenhuyse that Argenx and Galapagos are definitely companies that will continue to do well in 2020. They also had a two more suggestions from major companies to keep an eye on:

“In addition to Argenx and Galapagos, we believe that Mithra and Oxurion will continue to do well in the coming year. Mithra had a strong year in 2019 with multiple licensing deals for its two leading Women’s Health products Myring™ (a vaginal contraceptive ring) and Estelle® (an oral contraceptive). With an ongoing Phase III clinical trial for Donesta® (a hormone therapy for menopausal women), we think Mithra will continue to do well.”

“Oxurion faced some challenges last year, with poor results for their phase II trial in THR-317. However, in 2020 they have already published positive phase I results for THR-687 (a potential treatment for diabetic macular edema) and their stock is climbing. With a second Phase II trial (in THR-149) set to start this year, it will definitely be worthwhile keeping an eye on Oxurion.”

What are some up-and-coming companies that might become future stars?

Although Galapagos and Argenx are familiar names, there are also some smaller companies that are poised to take the world by storm. Van Steenhuyse provided some suggestions:

“In the private sphere, both Confo Therapeutics and Aelin Therapeutics have intriguing technology platforms in-house, coupled with credible management teams to strategically apply these platforms in the right disease areas. While these are two very early-stage companies, Europe has also seen nice maturation of private companies recently.”

“Northsea Therapeutics and Sanifit are both in mid-stage clinical development and are definitely worth keeping an eye on in 2020.”

To read more about Confo Therapeutics, check out this previous BioVox article.

Confo Therapeutics was also on the V-Bio Ventures list for up-and-coming companies, which is unsurprising as V-Bio is one of the main investors in the GPCR drug discovery
company. Takke and Broekhart had several other names for us though, both from their portfolio and elsewhere:

“Some newcomers worth paying attention to this year include Confo Therapeutics, as well as Aphea.Bio (developing miocrobiom-based agricultural solutions), Camel-IDS (developing cancer-targeted radiopharmaceuticals) and Indigo Diabetes (developing Continuous Glucose Monitoring (CGM) systems for diabetes).”

For more on Aphea.Bio, read this VC Views article.

With so much in the works, we think it’s safe to say that 2020 will be an interesting time of growth for the Belgian biotech ecosystem. We’re excited to see what the next year has in store!


BioVox
BioVox

With a local focus and global reach, BioVox shares insights into the Belgian life sciences ecosystem with an ever-growing global community. BioVox is a non-profit project: we are able to provide our community with free, quality content because of the generous support of Turnstone Communications and its clients. Our articles bring you hidden opportunities and exclusive insights into the latest research and industry trends!

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