Ongoing political and economic turbulence in the US is casting uncertainty over the biopharmaceutical sector, with initial public offerings (IPOs) expected to slow as investors assess the risks.
Sweeping policy changes under President Trump’s administration – ranging from new tariffs to drastic cuts in key health agencies – have created instability that could deter investment and delay IPO activity. However, while the US market faces headwinds, shifting regulatory dynamics may present new opportunities for UK-based innovation, according to speakers at the OBN BioTrinity conference in London on 2 April 2025.
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Experts at the meeting highlighted that while investor confidence in public markets remains fragile, companies should increasingly look at alternative funding strategies such as mergers and acquisitions (M&A). At the same time, regulatory restructuring in the US has led to concerns about the capacity of the US Food and Drug Administration (FDA), potentially creating an opening for the UK’s Medicines and Healthcare products Regulatory Agency (MHRA) to attract more business.
M&A and IPOs
Biopharma IPOs saw a resurgence in 2024, with 50 companies completing IPOs and raising a total of $8.52bn. This marked the highest total IPO value raised since 2021, signalling a recovery in public markets as per a GlobalData analysis, the parent company of Pharmaceutical Technology.
Despite this resurgence, investors are facing renewed volatility this year. The instability stems from Trump’s recent tariff announcements and sweeping cuts to healthcare agencies, including the FDA, the Centers for Disease Control and Prevention (CDC), and the National Institutes of Health (NIH).
“Investors hate uncertainty, and we’re getting a lot of uncertainty right now, unexpected tariff wars, global conflict. People aren’t sure what’s happening with the FDA,” said Bill Hicks, co-chair of Mintz’s life sciences law practice.
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By GlobalData“We could be looking at 18 months of pretty high uncertainty.”
He added that interest rates will also be a determining factor in how biotech investment trends evolve. “If interest rates come down, biotech becomes more [attractive]… We need some level of macro stability before the IPOs will come back.”
New England Biolabs director Kiran Gulati stated: “In this environment, companies should increasingly explore alternative funding strategies.
“It just lends to the argument to look at other options through M&A, or other ways to build funding, build the value of your business instead of sitting back and burning the cash.”
Hicks echoed this sentiment: “Waiting for the ideal market to come back, that’s not necessarily a strategy. Create your own opportunity.”
Regulatory uncertainty
Beyond capital markets, regulatory uncertainty in the US is creating challenges but may also open doors for other jurisdictions, including the UK. The removal of senior FDA officials such as Peter Marks and an ongoing restructuring of the agency have raised concerns about the stability of the US regulatory environment.
“What’s happening over in the FDA, and what is potentially happening with new leadership in the MHRA… could be a real opportunity for the UK,” said Stuart Rose, CEO of OBN. He noted that sentiment has shifted over the past year, with many now seeing the MHRA as a more attractive regulatory partner. The MHRA appointed a new CEO, Lawrence Tallon, in March 2025.
Kirsty Wydenbach, head of regulatory strategy and drug development clinician at Weatherden, highlighted the challenges facing the FDA: “There is huge uncertainty… the FDA announced a reorganisation back in October last year, even before the election. And for anybody who’s been through regulation in the UK in the last few years, that rings huge alarm bells.”
She noted that the MHRA had undergone its own restructuring post-Brexit but has since stabilised, whereas the FDA now faces significant disruptions, including potential restrictions on its ability to communicate transparently with stakeholders.
Lehane Consulting’s managing director Lucy Lehane framed this uncertainty as an opportunity for UK innovators: “I think one of the things that I’m certainly trying to do within my business and encouraging clients to do is see this as the opportunity that it can be, to shape what the future might look like in terms of both innovation and regulations.”
