BIO2025 is more than a gathering of 20,000 biotech community leaders; it affirms that innovation and investment are committed to the sector.
Gil Bashe, Health Tech World Correspondent and Editor-in-Chief, Medika Life, is onsite at BIO2025. Gil serves as Global Chair Health and Purpose at FINN Partners
Industry observers are quick to say biotech is going through “hard times.” Headlines note the drop in venture capital since the peak of the COVID-19 pandemic and cite a sluggish IPO environment as evidence of an industry in distress.
However, a closer examination reveals a more complex—and ultimately optimistic—story: biotech is not retreating. It’s realigning.
In recent months, respected media outlets have noted that the biotech pendulum has swung—from a period described as a ‘dark place’—to renewed optimism that ‘biotech is back.”
If the energy at BIO2025 indicates the current mood, the halls are filled with cautious optimism.
From Surge to Stabilisation
The investment surge during the COVID era was not an anomaly but a catalytic event.
The demand for vaccines, treatments and global coordination pushed biotech into the spotlight, opening wide the funding spigot along with infrastructure investment.
Contract Research Organizations (CROs) expanded rapidly, providing clinical trial support with new approaches to remote monitoring and digital tech, and manufacturing muscle at a scale previously unseen.
At the moment, it was not seen as a temporary boom, but a structural reset.
But, if we look at the peaks and valleys of investment, it appears times have changed.
“The Biotech Industry is a vibrant, thriving industry. Growth and investment in the commercial organisation are increasing for those with a commercial product,” says Craig Ackerman, partner, Alexander Group.
“We also see a significant uptick in late-stage clinical organisations looking to commercialise therapeutics. The COVID cliff is behind us, and the future is bright.”
The biotech sector experienced a dramatic rise in attention and capital during the early phase of the COVID-19 pandemic.
Global venture funding into biotech topped $40 billion in 2021, driven by urgent vaccine development and therapeutic innovation. Biomanufacturing capacity skyrocketed.
CROs, long essential but often behind the scenes, became indispensable.
The Ackerman Group suggests that in 2025, more than 85 per cent of biotechnology and pharmaceutical companies plan to increase their commercial investments.
In Boston alone, lab space demand tripled during COVID’s peak, and large-scale CROs such as Charles River Laboratories and WuXi AppTec scaled rapidly to support the pace of development.
Investments in single-use bioprocessing platforms ballooned to meet demand for nimble production. In effect, a new biotech infrastructure was built—not just for COVID, but for the next generation of drug development.
Today, total capital remains relatively steady, but it’s flowing differently.
Fewer companies are commanding a greater share of investment, and a new global map of biotech leadership is emerging—one where Israel, Italy, Korea, Saudi Arabia, and NAME are not just participants but strategic innovators and investors in the space.
While some correction was inevitable after the pandemic’s urgency subsided, the sector’s foundation had already changed.
CROs didn’t scale down; they doubled down, offering sponsors the flexibility to develop therapies without taking on the full weight of manufacturing and trials in-house.
This shift underpinned a new era of capital efficiency and strategic outsourcing, which is strongly influenced by new smart technologies that generate code and content at a blink of an eye and refine research protocols.
Selective but Strong: The New Capital Math
After the surge of 2020–2021, a funding correction began in late 2022.
According to Jefferies, biotech funding in May 2025 was down 57 per cent year-over-year, dropping to roughly $2.7 billion.
Public markets also cooled. In 2023, biotech IPOs hit their lowest numbers in a decade, and follow-on offerings became increasingly rare.
This deceleration prompted talk of a “biotech winter.” Yet key indicators suggest a market in transition rather than decline. Private equity and venture capital remain active but are more selective.
While early-stage companies face greater hurdles, late-stage biotechs and those with de-risked clinical programs continue to attract significant funding.
Follow the Late-Stage Money
A recent GlobalData report underscores this trend: late-stage biotech companies now receive nearly double the capital of their earlier-stage counterparts.
Median venture rounds for Phase III companies have climbed to $62.5 million, as investors increasingly prioritise assets with regulatory clarity and near-term commercialisation potential.
The post-COVID period has revealed an important funding shift: fewer biotech companies are securing a larger percentage of available capital.
In an environment of macroeconomic uncertainty, geopolitical risk, and rising interest rates, investors are retreating from speculative bets and doubling down on known quantities.
Similarly, PitchBook notes that while biotech deals are down, deal sizes are up, particularly in oncology, rare diseases, and platform technologies such as cell and gene therapy.
This trend toward capital concentration doesn’t necessarily signal weakness—it suggests a maturing, wiser marketplace.
Investors are becoming more disciplined. They expect data, not hype; operational clarity, not aspirational roadmaps.
Biotech Without Borders: From Seoul to Tel Aviv
Perhaps the most dramatic transformation underway is geographic.
Once dominated by North American and Western European hubs, Biotech is now experiencing a global renaissance and diffusion.
South Korea has become a strategic a global contract development and manufacturing organisation heavyweight.
Samsung Biologics reported revenue of $3.3 billion in 2024 and continues to expand its manufacturing footprint.
In 2025, the South Korean government launched its National Bio Committee to accelerate biotech, AI, and data science integration.
Saudi Arabia is staking its claim as well.
At BIO 2025 in Boston, the Kingdom showcases a national strategy backed by billions in public investment to develop domestic biotech R&D and production capacity.
The country’s National Biotechnology Strategy projects $12.2 billion in investment by 2030.
Italy, long home to academic excellence and manufacturing strength, is gaining momentum.
With a €12 billion biotech economy and vaccine contributions from companies like IRBM, Italy is now attracting increased EU and private sector interest, particularly in oncology and neurodegenerative disease.
New models of investment, innovation, and collaboration are emerging from Japan.
Companies like Corundum, which combine academic research, global science partnerships, and investment mechanisms, are looking far beyond Japan’s traditional mindset of central control.
Corundum is even considering combining basic and applied research models abandoned by big pharma decades ago to pursue long-awaited cures.
“Medicine has become hyper-specialised.
“We have gastroenterologists who only look at the upper esophagus or the colon, cardiologists in electrophysiology, and neurologists focused on one nerve pathway.
“They perfect art, but they have blinders,” says Yasushi Yamamoto, musician, philosopher, investor, founder and CEO of Corundum Convergence, who is breaking down those walls.
Even amid regional conflict, Israel remains a beacon of resilience.
Its biotech sector, home to more than 1,600 life sciences companies, continues to attract global funding and advance research and clinical development.
The Israeli Innovation Authority’s new BioConvergence initiative—focusing on AI and biology integration—is just one sign of a system that doesn’t pause in adversity; it innovates through it.
“PolyPid is at the forefront of innovation in drug delivery, and the company is a clinical-stage startup,” notes Ori Warshavsky, chief operating officer, PolyPid.
“BIO2025 accomplishes this, providing us access to companies worldwide, all in one place.
“As important, companies attending BIO are interested in, and here to discuss our future pipeline development.”
This expanding global presence is not only increasing the talent pool and R&D capabilities—it’s diversifying the risk profile for investors and enabling companies to scale smarter through international partnerships.
The Rise of Leaner, Sharper Biotechs
The post-2020 biotech landscape isn’t just leaner—it’s more resilient.
The COVID bump accelerated the creation of infrastructure: labs, trial networks, digital platforms, and regulatory frameworks that endure.
The widespread adoption of decentralised clinical trials, AI-driven compound screening, and globalised regulatory partnerships has changed how therapies come to market.
As a result, a new class of biotech companies is emerging—leaner in structure, stronger in partnerships, and more strategically placed to weather capital cycles.
These companies are not chasing every indication; they are deeply focused, often targeting precision medicine, orphan conditions, or high-impact oncology assets.
Many are structured to operate with CRO partners from day one—sometimes as equity partners—allowing them to progress through trials without the capital burdens of a full-stack operation.
The Future Belongs to the Prepared
“Biotech is regrouping before its subsequent rise,” reflects long-standing health IR executive Fern Lazar, managing partner, Global Health Practice Lead at FINN Partners, onsite at BIO2025.
“Innovation is accelerating, but markets need time to absorb new technologies and therapies.
“I’m optimistic—investors are taking a longer view, giving leaders room to execute without chasing artificial milestones.”
As capital becomes more discerning, biotech leaders are adapting.
Companies entering the market today must meet a higher bar: a strong science foundation, a credible path to commercialisation, and the ability to communicate value across both clinical and investor audiences.
Investors, meanwhile, are adapting their strategies.
Funds like Blackstone Life Sciences and ARCH Venture Partners are increasing their exposure to late-stage assets, often through co-development or royalty-based financing structures.
From Seoul to Riyadh, governments are becoming investors and ecosystem builders, recognising biotech as a cornerstone of economic resilience and public health sovereignty.
Biotech is not in retreat—it’s in reinvention. The investment dollars are still flowing, but toward fewer, stronger hands.
The infrastructure built during the COVID-19 crisis remains in place, bolstered by CROs, manufacturing scale, and digital acceleration.
A new global order is emerging, with players like Israel, Italy, Japan, Korea and Saudi Arabia are investing heavily in their biotech futures.
The industry is pursuing a recalibration that will result in more sustainable innovation, better capital allocation and a broader global talent base.
Companies that adapt to this new environment—those that are data-driven, globally oriented, operationally lean and culturally collaborative—will define the next era of biotech breakthroughs.
The future remains bright.
However, it belongs to the leaders who will look anew at their funding and operating model.
Header Image Credit: Gil Bashe, Health Tech World Correspondent
