Innovation
Life Sciences & Healthcare Venture Financing Report FY 2025
- Innovation
- Report
- 4 minutes read
This report explores the market conditions for life science and healthcare, with specific insight into key areas like biotech, medical devices and healthtech.
- 2025 marked a selective recovery for UK and European life sciences amid an improving macro backdrop. Global venture funding into life sciences and healthcare rose 10% year-on-year ($54bn to $60bn), with Europe up 28%.
- Biotech investment remained highly selective but showed renewed momentum. Capital continued to concentrate in differentiated platforms and biotech megadeals across Europe, particularly in the UK, while first financing rounds driven by AI, neuro, and platform technology showed resilience.
- HealthTech expanded 29% YoY, led by significant mega deal activity in Europe and new highs in first financing activity. As a standalone, the UK healthtech market was a bit muted; despite significant deployment (e.g. Cera Care, Lindus Health), the market shrank 17% YoY.
Life sciences and healthcare in 2025
2025 marked a selective recovery for UK and European life sciences amid an improving macro backdrop.
Capital markets remained cautious but stabilising, with improving equity sentiment and declining interest rates beginning to support risk appetite.
Easing financial conditions and clearer regulatory direction helped underpin confidence, even as geopolitical uncertainty and macro volatility persisted.
A moment for medical M&A?
We saw an uptick in $1bn+ M&A deals in 2025 compared to 2024 (8 vs 6) although we note a lack of mid stage M&A transactions ($100m-$1bn) in 2025 compared to 2024 (only 1 deal compared to 7 in 2024 e.g. Exscientia for $650m).
We believe this phenomenon is driven by an increase in a competitive bidding process by pharma for top-tier assets with later stage assets unsurprisingly commanding increasingly higher valuations.
Oncology assets continued to lead the way although we saw two large acquisitions in the respiratory space.
Tech-bio trending in the golden triangle
The year’s largest tech-bio financings were led by established investors including Novo Holdings, RA Capital, OrbiMed, Sofinnova, Thrive Capital, Alphabet, GV, NEA, and SROne.
Overall, activity reflects sustained investor appetite for data-driven and AI-enabled biology. Investors are increasingly drawn to opportunities that combine validated biological endpoints and clear market potential with next-generation, data-centric discovery and development models.
Medtech marches on
European MedTech financing increased materially in 2025, reaching its highest level of the past three years. Growth was driven by capital concentrating into a small number of large, high-conviction transactions, with the top twenty rounds accounting for close to 80% of total funding. Deal volumes remained broadly stable, reinforcing a shift toward more selective rather than volume-driven.
By indication, investor capital clustered most strongly around non-invasive monitoring (NIM) and surgical, both heavily represented within the top ten most active investors.
What might the future look like?
The report also includes predictions for each subsector – here are the headlines for each.
Biotech, Diagnostics/Tools
Could Africa, IPOs, and AI fuel a global biopharma recovery?
Medical devices
Blurred lines early, large scale late.
Health tech
Is a near Series A market emerging? Late stages still in search of Exit – but where’s the roll up?
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