July 21, 2010
While capital remains hard to come by for Canada's life sciences companies, lawyers say that the industry will survive the current economic crunch and prosper.
But for life sciences entrepreneurs, money has always been hard to come by, especially in recent years. Venture capital activity in life sciences fell 41% in 2009 in Canada to just C$215 million invested in 39 transactions. By comparison, biotechnology investing in the United States declined 19%. Nonetheless, biotechnology became the single-largest venture capital investment sector, drawing US$3.5 billion.
However, given the relative unavailability of venture capital financing in Canada, it is important that Canadian companies appeal to U.S. and domestic investors.
"It's hard for a law firm to acquire life sciences industry expertise unless the firm is also doing U.S. deals," says Cheryl Reicin. Before joining Torys in 2005, Cheryl practised for two decades in the United States, including for 10 years as the head of an 85-lawyer international life sciences practice.
"Half my practice is still composed of U.S. deals and I want to keep it that way because that's how you stay in touch with the industry," she says. "We're busy because that helps venture capitalists and life science companies connect cross-border."
Cheryl is optimistic about the future of life sciences in Canada. "There was more U.S. money at the BioFinance 2010 conference in Toronto than ever before, with a significant number of U.S. investment bankers present."