The collapse of Silicon Valley Bank will leave early-stage biotechnology companies with a funding void, investors and analysts said on Monday, but larger, publicly-traded drug companies should escape unscathed.
Startup-focused lender SVB Financial Group last week became the largest bank to fail since the 2008 financial crisis, sending shockwaves through the global financial system and prompting regulators to step in to contain the fallout.had the U.S. government not steppedSVB’s demise likely leaves smaller biotech clients without an alternative lender, said Brozak, since other banks will now probably raise their funding thresholds to points that make investment difficult for smaller entities.
One healthcare investor who spoke on condition of anonymity said SVB’s absence meant fewer companies financed and biotechs paring back pipelines of medicines in development. “There’s definitely going to be a winnowing of the herd,” he said.
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