When Australian biotech Telix Pharmaceuticals pulled a last-minute plug on its US public listing, it was yet another sign that the initial public offering (IPO) healthcare landscape was as unpredictable as ever.
But as 2024 ends, a look back on IPO activity suggests a resurgence that has investors “bullish” going into the new year. Investment is still a substantial step down from lofty heights seen during the 2021–2022 boom, but signs suggest green shoots of public listings by biotech and medtech companies are growing in an upward trajectory.
Go deeper with GlobalData
Pharmaceutical Technology looks back on this year and what 2025 may have in store for companies targeting this leap.
This feature will primarily focus on IPOs conducted on US stock exchanges.
2024 biotech round-up
Taking top spot in biotech IPOs this year is CG Oncology – the cancer drug specialist raised $380m when it hit the NASDAQ trading boards in January. This increased to $437m at IPO close after the underwriters exercised the option to purchase additional shares.
Funds raised are going towards CG’s lead asset, cretostimogene grendenorepevec, an oncolytic virus immunotherapy, which is in development for the treatment of high-grade non-muscle invasive bladder cancer (NMIBC) and muscle-invasive bladder cancer.
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By GlobalDataGlobalData’s business fundamentals senior analyst Ophelia Chan says: “Oncology continued to dominate as the leading therapeutic area for IPOs this year, highlighted by CG Oncology’s $437m upsized IPO—the largest and first of the year. The company’s robust clinical data and ability to secure substantial capital have contributed to its strong performance in 2024.”
After a quiet summer, the IPO market reached full swing in autumn when Bicara Therapeutics, Zenas BioPharma, and MBX Biosciences all opened on the NASDAQ on the same Friday in September. The ‘triple-header event’ saw the three companies pull in over $700m combined. It was no surprise that the surge in activity came after the Federal Reserve’s decision to lower interest rates for the first time in years, ushering in a more inviting funding environment. This fruitful month was a stark contrast to August, which saw a significant global stock market dip amid fears of a US recession.
In June, Telix Pharmaceuticals – an emerging player in the fast-growing radiopharmaceutical space – pulled a last-minute plug on its IPO. The Australian company had been planning to list on NASDAQ and was on course to raise $232m – a value that would have placed it high on the list of biotech IPO sizes this year. Telix cited that its board did not move forward with the plans due to market conditions at the time.
Medtech listings
As expected with in life sciences investments, biotech and pharma dominated public listings. But medtech companies still emerged on US stock exchanges. BrightSpring Health Services carried out the largest IPO across healthcare in January, raising $633m on Nasdaq. The community-based healthcare services firm that focuses on treating patients with complex or chronic medical conditions was valued at $2.2bn at the time. Despite the large value relative to other IPOs, the listing was seen as a warning indicator to the wider IPO landscape due to the opening being below BrightSpring’s targeted range.
Health technology company Tempus AI, who uses artificial intelligence (AI) to help healthcare professionals better diagnose and treat cancer and other diseases by accessing large genomic and clinical datasets, debuted on Nasdaq with $410.7m. CeriBell, a medical device maker with an EEG platform that uses AI to monitor patient seizures, priced its IPO at $180.3m, marking its inclusion in one of the few medtech listings of the year.
Experts’ analysis of 2024
Biotech IPOs raised $3.72bn in total in Q1 2024. This figure was six times the amount raised in Q4 2023 and marked the highest quarterly biotech IPO value in over a year on a quarter-on-quarter (QoQ) comparison, as per analysis by GlobalData. Analysts at the time said the increase set a strong pace for the year, forecasting the early success would be seen by private biotechs as opportunity to pursue public offerings later in the year.
However, the volatile IPO market weakened into Q2. “We have seen fewer IPOs since the start of Q1, likely influenced by factors such as economic uncertainty and anticipation of interest rate cuts,” Chan explains.
From a wider viewpoint, there has been a sharp decline in IPO activity over recent years. In 2023, biotech IPO investment reach $2.9bn, around 82% lower than the average IPO levels during the boom, says Antoine Papiernik, chairman and managing partner at Sofinnova Partners .
The headwinds in investment this year have meant a polarised setting has developed now, Papiernik explains. “Nasdaq's underperformance constrained many companies, forcing pipeline streamlining to extend their runway. Venture fundraising for life sciences stayed low compared to its 2021 peak, creating a stark divide: a minority of companies raised oversized rounds to fund progress, while most struggled to secure VC funding,” he says.
“This funding disparity highlighted the difficulty many innovators face in advancing breakthroughs amidst constrained capital markets.”
Leaving comparisons to the heady highs of the 2021–2022 period aside, 2024 has still been a prosperous year for life science IPO values.
“Completed IPO values have surpassed those of 2022 and 2023, reaching $7bn to date. However, IPO volumes have declined to below pre-Covid-19 pandemic levels, signalling a gradual stabilisation,” Chan adds.
Despite a year-over-year decline in listings specifically in the Q3 window, IPO activity demonstrated “remarkable resilience in equity offerings, launching 11% more IPOs than the previous quarter,” as per the EY Global IPO Trends Q3 2024 report, which analyses figures across all industries. The report adds that good IPO returns this year reflect robust investor confidence even in times of market uncertainty.
The report stated that health and life sciences and technology sectors continue to lead IPO activity by number of deals and total proceeds in the Americas from Q1–Q3 this year.
EY Global life sciences deals leader Subin Baral says: "The IPOs we are seeing look more like the traditional moves made by companies with late-stage, relatively validated and de-risked product offerings – as opposed to what we saw during the IPO boom during the pandemic."
2025 outlook
Senior leaders and investors from across the global healthcare sector are confident in an upward trajectory for IPOs next year. As per the Jefferies 2024 Temperature Check, 20% of respondents expect equity raising and IPOs to dominate transactional activity next year, versus just 6% who said the same last year. According to the investment firm, the figures mark the “most bullish outlook” for IPOs since the survey began in 2018. In a separate question, 64% of respondents expect to see an IPO level uptick in 2025.
Meanwhile, as per EY’s report IPO activity was expected to continue progressing, apart from any uncertainty in YE 2024 due to the US presidential election and other events.
Baral says: "Obviously [it is] too early to say what specific policies will be enacted or what the downstream impact of the new administration will be for the industry, but many investors are optimistic and a surge in investor optimism could in itself trigger a reopening of the IPO window."
It is hard to predict how US-President Elect Donald Trump’s new administration will affect investment. Some policies that look to implement tax cuts and tariffs will increase optimism, whilst developers of vaccine might see their stocks slide if new health secretary Robert F. Kennedy Jr., who is a vaccine sceptic, makes any drastic decisions.
Chan says that the administration's deregulatory stance “may create unpredictability in healthcare policies, particularly concerning drug pricing reforms and regulatory frameworks”, which could “further impact investor confidence, potentially dampening enthusiasm for new market entrants.”
Papiernik states: “The life sciences investment and M&A market is poised for continued growth through 2025, building on the recovery seen in 2024."
As ever with IPOs, unpredictability seems to be an inherent characteristic that can’t be shaken. A clearer image of 2025 will only emerge once the first companies make the plunge to go public.
