- The 2021 biotech SPAC boom produced mega-vehicles raising billions to merge with mostly pre-revenue, clinical-stage companies at lofty valuations.
- Post-merger outcomes diverged, with Roivant holding roughly $4–5B in cash to fund late-stage trials despite large operating losses and Celularity growing product revenue while still unprofitable after restructuring and retiring debt.
- As deal performance, regulatory scrutiny, and legal exposure increased, the SPAC market cooled and investors shifted focus from speed-to-capital to clinical execution, revenue growth, and financial discipline versus the IPO route.
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The “SPAC Attack: The 10 Biggest in Biotech” article from September 2021 documented major SPAC transactions in biotech, highlighting valuations, target companies, and raised capital, reflecting exuberant investor sentiments during that period [Primary]. However, large-scale biotech SPACs have since faced mixed outcomes. Recent financial data from prominent SPAC-origin companies like Roivant and Celularity illustrate both progress and persistent risk.
Roivant’s Evolution Since SPAC: Having merged via SPAC, Roivant (ticker ROIV) has built a robust cash position ($4-5B) that now supports late-stage programs. Key programs like brepocitinib (Phase 3 dermatomyositis, non-infectious uveitis, cutaneous sarcoidosis) and batoclimab (MG, CIDP, and other immune disorders) are progressing, with several pivotal readouts expected over 2025-27 [Roivant 7][Roivant 2]. Roivant’s share buyback of ~$1.3-$1.5B reflects confidence but also suggests limited acquisition or revenue upside thus far, given operating losses remain substantial (>$700M) [Roivant 2][Roivant 7].
Celularity’s Post-SPAC Trajectory: Celularity, another SPAC target, has shown strong growth in biomaterial sales: net revenues increased ~138% year-over-year for 2024 to ~$54M, largely driven by the Biovance® line and recent product acquisitions such as Rebound [Celularity 1][Celularity 10]. The company also took steps to retire ~$41.6M in senior secured debt and restructured into operating subsidiaries for its business lines—including biomaterials, biobanking, and cell therapy—to improve balance sheet flexibility [Celularity 6]. Nonetheless, despite momentum, Celularity still incurred significant operating loss and continues to need approvals and revenue diversification to move toward profitability.
Broader SPAC Market & Regulatory Dynamics: After a surge in SPACs raised in 2020-21, the market cooled significantly under regulatory scrutiny and deteriorating deal performance [News 12]. Recent signals suggest some revival—Goldman Sachs re-entering selectively in 2025 amid a more disciplined SPAC environment [News 13]. Yet, cases of shareholder lawsuits—particularly in Delaware—highlight legal and reputational tail-risks for SPAC sponsors and target companies [News 12].
Strategic Implications & Open Questions: For investors and biotech management, the key is execution. The pre-SPAC justifications—access to capital and speed to market—are now being replaced by demand for demonstrated clinical outcomes, revenue generation, cost discipline, and regulatory compliance. Some open issues include: whether Roivant and Celularity can achieve profitable scale; whether current valuations (often large enterprise values set during SPAC deals) can be justified by clinical and commercial milestones; how investors will weigh the risks of product failure versus potential upside; and how regulatory/legal reforms will shape SPAC deal disclosures, investor protections, and sponsor liability going forward.
Supporting Notes
- Roivant reported cash, cash equivalents and marketable securities of approximately $4.9 billion as of March 31, 2025, giving it a substantial runway into profitability [Roivant 2].
- Roivant’s operating loss widened to $729.8 million in fiscal year 2025, driven by rising R&D and G&A expenses, even as revenue remains modest [Roivant 2][Roivant 4].
- Roivant expects top-line results for the Phase 3 trial of brepocitinib in dermatomyositis (DM) in the second half of 2025, and for non-infectious uveitis (NIU) in first half of 2027 [Roivant 7].
- Celularity net revenues for full year 2024 rose to $54.2 million, up 138.1% from the prior year; growth driven by biomaterial product line (wound care) and acquisition of Rebound [Celularity 1].
- Celularity retired all $41.6 million in senior secured debt, restructured into operating subsidiaries, potentially reducing financial risk ahead of a February 2026 repayment due date [Celularity 6].
- The Delaware Chancery Court has allowed shareholder lawsuits to proceed alleging misrepresentations in SPAC merger terms regarding share value; legal risk remains material [News 12].
- Goldman Sachs has reengaged in SPACs in 2025 after a hiatus, signaling renewed institutional interest under stricter selectivity and regulatory context [News 13].
- The 21 biotech-focused SPACs not yet closed in 2021 had raised approximately $5.2 billion; traditional IPOs over the same period had raised ~$9 billion, showing competition between SPAC and IPO routes [Primary].