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Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong. Take 2 mins to learn more

Biotech investing… the UK is attracting attention
Feb 19 2021

We are seeing death rates and cases decrease and vaccination distribution increases, but does this mean that we are at the tail end of the pandemic? 

Well we all hope so; one of the trends that we have seen in these uncertain times is certain industries coming through this stronger, and biotech companies seem to have a tail wind. 

The SPDR S&P Biotech ETF is making fresh highs; investors have been reading their old biology textbooks and realise the importance of science on both the economy and society. 2020 was a marquee year for biotech fundraising. The total capital raised by the global biotech sector in 2020 raised almost $134bn.*

In line with the historical trends, in 2020, UK biotechs attracted the most attention from the venture capital community.

There are a number of key trends which are supporting the sector in the UK:

  • The UK biotech sector holds many of the solutions to today’s most urgent global challenges.
  • Biotech has received strong government support and with record levels of private and public investment over the last decade, the sector’s position as a key strategic sector is only set to continue after the COVID-19 pandemic.
  • Large, multinational pharmaceutical firms that distribute most medicines across the globe are developing fewer new drugs in-house –  making them eager buyers of biotech assets.

The UK Biotech cluster is the third largest in the world, driven by research and innovation the returns for investors are outperforming the tech sector over the long term.  In the UK, we have world-leading universities and research facilities.

Early stage biotechs and emerging pharma companies, who are at the forefront of innovation and technology, are especially in need of funding to strategically drive the future of their assets and company.

As a result, deal evaluation has never been more important when looking at the investment opportunities. Since its inception, the o2h group has developed a rigorous process to evaluate its deal flow, particularly regards seed investments. Opportunities come from a wide range of sources, as a result of the o2h group’s extensive network of contacts. These are quickly filtered using defined criteria. The evaluation committee will undertake thorough due diligence, utilising the support of network experts, where necessary. This process will include detailed assessment of the target validation/rationale, assets and their protection, team, business plan, risks and mitigation strategies and route to market/exit. The team will also speak to potential licensers/end users to ensure the business strategy is attractive for their needs.

We have access to some of the most interesting scientific ideas and talent in the UK., achieving a clearly differentiated position through its live working relationships, fostered over many years, working as a discovery services company. This potentially gives o2h Ventures earlier access than competitors to some of the most promising companies.

The business model we’ve developed provides an edge both in terms of access to opportunities as well as an understanding of the post investment support to nurture and grow during incubation. By combining these, we are providing a unique opportunity, reducing investment risk through our support mechanisms. The team believes that this will increase the Fund’s prospects to achieve successful exits.

Early stage biotechs and emerging pharma companies, who are at the forefront of innovation and technology, are especially in need of funding to strategically drive the future of their assets and company.

For more information on our open investments check the website www.o2hventures.com

*BioWorld.com. 2020. COVID-19 Therapeutics And Vaccines Available And In Development. [online] Available at: https://www.bioworld.com/topics/84-bioworld

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more articles by o2h ventures
  • o2h-ventures Biotech and digital therapeutics…a great opportunity 13 Jan 2021
  • o2h-ventures Investing in Therapeutics and Biotech Innovation 31 Dec 2020
  • o2h-ventures Knowledge intensive investing… a new investment era 09 Dec 2020
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o2h Ventures Limited
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Please refer to the relevant fund’s full risk warnings contained in their Information Memorandums.
Your capital is at risk. Investing in early stage businesses involves risks, including illiquidity, lack of dividends, loss of investment and dilution, and it should be done only as part of a diversified portfolio. o2h Ventures’ funds are targeted exclusively at sophisticated or high net worth investors who understand these risks and make their own investment decisions. Tax relief depends on an individual’s circumstances and may change in the future. In addition, the availability of tax relief depends on the company invested in maintaining its qualifying status. Past performance is not a reliable indicator of future performance. You should not rely on any past performance as a guarantee of future investment performance.
o2h ventures Limited is regulated and authorised by the Financial Conduct Authority (FRN 812245). Capital at risk, only suitable for high net worth and sophisticated investors
© 2025 o2h ventures
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Risk Information

Due to the potential for losses, the Financial Conduct Authority (FCA) considers this investment to be high risk

What are the key risks?

1 – You could lose all the money you invest

• If the business you invest in fails, you are likely to lose 100% of the money you invest. Most start-up businesses fail.

2 – You are unlikely to be protected if something goes wrong

• Protection from the Financial Services Compensation Scheme (FSCS), in relation to claims against failed regulated firms, does not cover poor investment performance. Try the FSCS investment protection checker here. (https://www.fscs.org.uk/check/investment-protection-checker)

• Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA-regulated firm, FOS may be able to consider it. Learn more about FOS protection here. (https://www.financial-ombudsman.org.uk/consumers)

3 – You won’t get your money back quickly

• Even if the business you invest in is successful, it may take several years to get your money back. You are unlikely to be able to sell your investment early.

• The most likely way to get your money back is if the business is bought by another business or lists its shares on an exchange such as the London Stock Exchange. These events are not common.

• If you are investing in a start-up business, you should not expect to get your money back through dividends. Start-up businesses rarely pay these.

4 – Don’t put all your eggs in one basket

• Putting all your money into a single business or type of investment for example, is risky. Spreading your money across different investments makes you less dependent on any one to do well.

• A good rule of thumb is not to invest more than 10% of your money in high-risk investments (https://www.fca.org.uk/investsmart/5-questions-ask-you-invest)

5 – The value of your investment can be reduced

• The percentage of the business that you own will decrease if the business issues more shares. This could mean that the value of your investment reduces, depending on how much the business grows. Most start-up businesses issue multiple rounds of shares.

• These new shares could have addition rights that your shares don’t have, such as the right to receive a fixed dividend, which could further reduce your chances of getting a return on your investment.

If you are interested in learning more about how to protect yourself, visit the FCA’s website here (https://www.fca.org.uk/investsmart)