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​​Life Sciences Funding in View​

1/26/2026

Global funding activity across the life sciences sector was mixed in 2025. Venture capital (VC) activity was slightly higher, while the initial public offering (IPO) market experienced a down year. M&A deals accelerated sharply as pharmaceutical companies increased acquisition activity. Investor sentiment weighed on funding early in the year but improved meaningfully in the second half, driving a pickup in activity and signaling stronger momentum heading into 2026. 

Despite improving funding conditions, the life sciences CRE recovery is expected to lag. Elevated vacancy and subdued leasing demand persist across major markets, as companies continue to exercise discipline in hiring and expansion. While the CRE recovery may progress gradually, this disciplined occupier approach will position the sector for healthier, more sustainable growth ahead as underlying fundamentals fuel long-term growth.

Key Takeaways
  • Globally, life sciences VC activity was slightly higher in 2025, while the IPO market experienced a down year. The U.S. continued to dominate deal volume, followed by China and the UK. Activity strengthened in the second half of the year, pointing to improving momentum entering 2026.
  • M&A surged in 2025, with deal volume more than doubling YOY as pharma companies accelerated acquisition activity to strengthen pipelines.
  • In the U.S., investor sentiment constrained VC and IPO activity early in the year before improving meaningfully in the second half. Despite the pickup, companies continue to face a higher bar to raise capital or pursue public offerings.
  • Although some 2025 headwinds have eased, investors remain focused on companies with strong clinical results and clear regulatory pathways, reinforcing a selective funding environment.
  • Life sciences CRE remains in a reset phase. While improving funding conditions are expected to support the sector over time, elevated vacancy and muted leasing demand are expected to weigh on the pace of recovery.

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