US biotechnology companies scored some notable victories in November, despite continued "wild gyrations" in the stock market fuelled by economic and political worries in Europe and the US, says a new report.

November saw some encouraging clinical developments, three drug approvals, two Initial Public Offerings (IPOs) and news that Gilead Sciences is to buy Pharmasset for $11 billion, says the report, from life sciences financial services specialist Burrill & Co.

The latter deal, which marries Pharmasset's pipeline of three clinical-stage hepatitis C virus (HCV) products to Gilead's own pipeline of seven clinical candidates, "could lead to therapies that transform the way HCV is treated by bringing together the promise of Pharmasset's drugs with the depth of experience Gilead has in antiviral therapies and its own pipeline of VCV candidates," commented Burrill & Co’s chief executive, G Steven Burrill.

"Many people have questioned the viability of drug development business models, but as this transaction shows, innovative companies are still capable of creating enormous value and rewarding investors for their patience," he noted.

Also, two US life science companies went public in November. Clovis Oncology, a company founded by the former executives of Pharmion, completed a $130 million offering, while New Link Genetic raised $43 million.

But overall, the 16 life science companies that successfully completed IPOs on US exchanges in 2011 are down an average of 14.2% from their IPO price, with five advancers, 10 decliners and one unchanged, says the report.

"IPOs will continue to get done, but companies will need to be both opportunistic and realistic," says Mr Burrill. "Once we get into the new year and there is greater clarity on the situation in Europe and recent market pressures ease, we should see a pick-up in activity coming out the annual JPMorgan Healthcare Conference," he forecasts.

November was a solid month for life science venture financings but less so for life science venture capital firms, the report adds. US venture funding totaled $690 million during the month, but the sector saw an increasing number of investors exit the life sciences space or announce plans to curtain their activity.

A survey by the National Venture Capital Association (NVCA) has found that nearly 40% of life science venture capitalist firms plan to invest less in the sector during the next three years, and Burrill & Co says this reflects both frustration with regulatory barriers and the weak market for IPOs that have made it difficult for venture investors to cash out of their investments.

"These are troubling developments that could constrain the availability of capital to promising young companies in the years ahead. It is vital that we address regulatory barriers and capital market constraints that ultimately may be choking off important sources of innovative medicines and new jobs," it says.

The US Food and Drug Administration (FDA) approved three new drugs in November - Transcept's insomnia drug Intermezzo (zolpidem tartrate sublingual tablet), Regeneron's eye disease drug Eylea (aflibercept injection) and EUSA Pharma's blood cancer treatment Erwinase (L-asparaginase). These raised the number of new drugs approved by the agency in 2011 to 29, significantly more than 2010's full-year total of 2010, says the study.

November also saw Pfizer's patent expire on Lipitor (atorvastatin), the best-selling drug of all time, and we will probably never see another market success like it, comments Burrill. In many ways, the patent expiry marks an end to the blockbuster era, and "we are now moving on to a future, one defined by targeted therapies and informed by an understanding of a patient's individual genetics, a future in which we'll be able to determine whether and for whom drugs such as Lipitor will provide any benefit," it says.