TSX Venture Exchange (TSXV), a premier junior stock exchange, has a strong history of helping early stage health and life sciences companies raise patient capital for research and development purposes. On average, companies that go public on the TSXV raise ~ $8 million and have a market value of ~ $47 million. As of February 28, 2022, TSX & TSXV is home to 159 life sciences companies that have a total market capitalization of $32.2 billion. This type of capital helps companies focus on staying true to the original vision of their founders with the support of investors that are willing to forgo immediate returns for more substantial, lasting returns.
Having a two-tiered stock exchange model in Canada, with TSX for later-stage companies and TSXV for earlier-stage companies, gives emerging companies the opportunity to access public markets earlier in their lifecycle. When they’re ready, it helps them graduate from the TSXV to the TSX – also presenting them the opportunity to dual-list on a major U.S. exchange down the line should they choose to.
The top performer in 2021 in the clean technology and life sciences sector was Sernova Corp. (TSXV:SVA), a clinical-stage company focused on regenerative medicine therapeutics technologies for chronic diseases. As of December 31, 2021, it had a market cap of $475 million while its share price increased by 172% over the course of the year. Sernova’s growth demonstrates the benefits of patient capital in drug development and biotech therapeutics.
The pandemic accelerated focus on the life sciences sector globally, and here in Canada, highlighting the importance of early investing in the development of therapeutic solutions for emerging health issues. Another TSX Venture top performer was Therma Bright Inc., which saw its market cap double and share price rise by 91% in 2021. The company focuses on thermal therapy technology, incorporating artificial intelligence and Internet of Things (IoT). During the pandemic, Therma Bright added Covid-19 diagnostics to its product line with at-home rapid antigen testing kits for a growing list of coronavirus variants.
Rising awareness among health-conscious consumers, coupled with the needs of an aging population, means the life sciences industry will continue to be an important driver of health innovation in North America. With support from investors and other government funding programs, Canada can become a major global hub for clinical trials, drug development, and research and development of AI-enabled biotech health solutions.
* Unless otherwise noted, all data is sourced from the Market Intelligence Group of TMX Group as of December 31, 2021 and values are quoted in Canadian dollars.
Daniel Lubienietzky is the Manager of Innovation and Life Sciences at the Toronto Stock Exchange and TSX Venture Exchange, based in Toronto. Daniel works alongside his colleague George Khalife, VP of Capital Formation, based in Chicago, and who covers the Midwest U.S. for all sectors at TSX and TSX-V. Daniel and George can be reached at daniel.lubienietzky@tmx.com and george.khalife@tmx.com, respectively.
