Private Biotech Funding Takes a Steep Dive in H1 2025

The biotech sector’s prolonged funding slump is intensifying, with even previously robust private companies now facing significant challenges. An Endpoints News tracker reveals a sharp decline in “megarounds” (funding rounds of $100 million or more) for private biotechs in the first half of 2025.

Key Data Points:

• Megarounds Decline: Only 31 private biotechs secured nine-figure funding rounds in H1 2025, a 38% drop from 50 in H1 2024.
• Total Capital Halved: While the average round size slightly increased ($185 million vs. $178 million), the total capital raised plummeted from $8.91 billion (H1 2024) to $5.76 billion (H1 2025).
• Q2 Slowest in Seven Years: The second quarter of 2025 is tracking to be the slowest for private biotech capital raised in over seven years, with just 52 deals totaling $4.1 billion, compared to 71 rounds totaling $7.1 billion in Q2 2024.

This challenging environment for the capital-intensive industry is attributed to several factors: slashed federal research funding, persistently high interest rates, the threat of pharmaceutical tariffs, changing drug regulatory oversight, the influx of China licensing deals, and a near absence of IPOs. The public biotech index ($XBI) also remains down about 7% this year.