An Overview of Biotech Financing in 2024

Biotechs engaged in developing therapeutic assets have remained a focal point for both big pharma and investors. While the sector has experienced a recalibration of financing levels compared to the peak years of 2020 and 2021, 2024 has brought its share of opportunities and challenges. Drawing from the most recent data in the Biotechgate database, this article examines the financing landscape for biotechs in 2024.

The Biotechgate database defines companies that fall under the ‘Biotech – Therapeutics & Diagnostics’ banner as organizations that employ living organisms or biological substances to develop products and/or services, with the goal being to discover and develop novel therapeutic compounds and probe molecules for application in medicine. For further information, visit our page on industry sectors covered >>

2024 in Review

Total financing for biotechs globally surpassed USD 70 billion in 2024. While the typical seasonal “summer slowdown” was evident, the lowest monthly total occurred in November, with just USD 2.6 billion raised. In contrast, March stood out as the most robust month for financing. This was buoyed by several post-IPO deals, including Moderna, Viking Therapeutics and Madrigal Pharmaceuticals.

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Type of Financing

Private equity remained the dominant mode of funding in 2024, accounting for over 50% of transactions. This represents an increase from 45% in 2023, reflecting the growing reliance on venture capital and private equity investors to support early-stage and growth-stage companies.

In contrast, government grants saw a decline compared to the previous year. This reduction may show shifting priorities in public sector funding as governments move away from pandemic-related R&D support.

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Financing by Country

As expected, the United States retained its position as the global leader in biotech financing, capturing the majority of financing round activity. European companies ranked second, while organizations in other regions accounted for 19% of financing rounds.

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Among these regions, China emerged as a significant player, achieving the second-highest number of financing rounds on a per-country basis. Other notable contributors included Canada, Australia and Israel, each of which saw substantial levels of investment activity.

IPOs

The biotech IPO market in 2024 remained subdued, continuing the downward trend compared to the post-pandemic peaks. The number of IPOs dropped from 38 in 2023 to 28 in 2024, displaying both investor and company caution amid challenging market conditions for public offerings.

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Despite the decline in activity, there were some noteworthy IPOs. Immune drug developer Alumis raised USD 250 million in the largest public offering of the year, debuting on the Nasdaq at a share price of USD 16.00. However, as of the time of writing, the company’s price has more than halved, underscoring the volatility and risks associated with early-stage biotechs on the public markets.

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