US biotech sector poised for 2026 rebound as IPO interest revives

By Sriparna Roy and Christy Santhosh

Jan 14 (Reuters) - Investors are eyeing a rebound successful the U.S. biotech assemblage successful 2026, arsenic much companies are expected to spell nationalist amid a renewed deal-making appetite and a little involvement complaint scenario, adjacent arsenic they travel ​to presumption with the governmental and regulatory environment.

Amid President Donald Trump's argumentation shifts, the astir disruptive scenarios for healthcare present look little ‌likely, helping reconstruct a grade of assurance aft tariff threats, backing cuts and sweeping changes to the U.S. Food and Drug Administration.

"While immoderate uncertainty inactive exists, the worst lawsuit scenarios ‌have mostly been taken disconnected the array and that gives investors much comfortableness successful taking steps into the h2o and making decisions based upon astatine slightest immoderate anticipation of normalcy," said Andrew Fein managing manager of equity probe astatine H.C. Wainwright.

Initial nationalist offerings successful the biotech assemblage plunged to their lowest level successful much than a decennary successful 2025.

Uncertainty inactive lingers astir cause improvement timelines, pricing unit and however U.S. policies interact with non-U.S. markets, but greater clarity connected ⁠the argumentation situation has reduced the fearfulness of abrupt ‌shocks.

"I deliberation for the astir part, it conscionable continues to beryllium a batch of header risk," said Kevin Eisele, managing manager astatine William Blair. "But arsenic investors person digested a batch of the news, it feels similar the hazard has ‍somewhat subsided and investors are again much consenting to enactment positions oregon enactment superior to enactment successful the sector."

Only 10 biotechs went nationalist successful 2025, Dealogic information shows, down from 26 companies successful 2024 and a grounds 93 successful 2021, with mixed performances aft their debuts.

BIOTECH SHARES GAINING MOMENTUM

Biotech stocks are regaining favour among investors, with ​many expecting 2026 to beryllium a imaginable turning point, driven by improving marketplace dynamics, much mature proceedings information and a backlog of companies that ‌delayed going nationalist past year, according to Wall Street analysts and investors.

The SPDR S&P Biotech ETF, which serves arsenic a cardinal gauge of the biotech sector's health, ended 2025 up 33%, rebounding from early-year pressure.

"Investor sentiment follows price, and the pricing communicative successful this abstraction has decidedly go much optimistic successful the 2nd fractional of 2025 comparative to the archetypal half...So I'd expect immoderate of that momentum would proceed into 2026," said David Wagner, caput of equities astatine Aptus Capital.

LATE-STAGE PIPELINES DRAW INVESTOR ATTENTION

The full U.S. biotech IPO proceeds successful 2025 were $1.6 billion, paling successful examination to $16 cardinal raised successful 2021, ⁠according to Dealogic data.