For biotech companies the past two years have been challenging. Biotech investments have not reached the record levels of 2020 and 2021 and an anticipated stock recovery in 2024 failed to materialise. The good news is that funding is available. However, its distribution has changed to favour fewer biotech companies with much larger deals. These mega rounds result in a lucky few biotech companies having longer runways to develop their assets. For investors this model makes sense, the biotechs they invest in can focus on drug development rather than fundraising to underwrite successive development phases. In 2025 ICON Biotech conducted a follow-up survey of biotech leaders, previously carried out in 2023. The new results show changing trends in the risks, challenges and opportunities in the biotech sector.
More biotechs plan to seek additional funding for R&D
Our global survey found that the majority of respondents (75%) expect to increase their R&D spending in the next one to two years. This tracks closely with the 2023 survey results where 72% of respondents planned to increase R&D spending. What has changed is that in 2025, 41% of respondents expect to seek additional funding to pay for their R&D, compared to just 14% seeking additional funding in 2023. The top three funding sources for biotechs in 2025 were large pharma partnerships, venture capital firms and government grants/public funding. Angel investor funding decreased by five percent between 2023 and 2025 but there was a corresponding seven percent increase in venture capital funding.
China: Threat or opportunity?
One of the biggest biotech news stories of recent years is China’s continued rise as a biotech and life sciences powerhouse. China conducts a quarter of all clinical trials and drug development and has almost 1,500 new drugs in development.¹ Many China-based biotechs have benefitted from government funds, out-licencing deals with large pharmas and venture capital funding. However, policymakers in the US and EU have concerns about the possible threat to their region’s biosecurity and competitiveness as centres for health and life science research. Given China’s increased importance, ICON Biotech conducted the same biotech sector survey with 100 China-based biotech leaders. The results show that Chinese biotechs face many of the same challenges as biotechs located elsewhere. They share the same funding challenges and burdens associated with increasingly complex clinical trials and regulations.
Therapeutic activity trends
A notable difference between the survey responses in China and globally was the therapeutic area activities of respondents’ organisations’ pipelines. In the 2023 global survey, oncology led as the therapeutic area with most activity (42%). By 2025, neurology had overtaken oncology as a research activity for respondents, 44% of respondents’ organisations were active in neurology vs 30% in oncology. Cardiovascular (39%) and immune disorders (32%) were also ahead of oncology. By contrast, in China oncology remains in the top three therapeutic area activities at 53% along with cardiovascular (58%) and neurology (37%). One of the reasons that oncology may have waned is due to the difficulty of differentiating from other oncology biotechs. This has resulted in some companies pivoting to immunology or autoimmune or, where possible, enhancing their oncology treatments with technology. Despite these pipeline activity changes among our survey respondents, oncology remains a hugely competitive research area. In 2025 oncology R&D partnership deal values tracked ahead of deal values for the same period in 2024.²
Biotech sentiment
Biotech companies are adept at operating through ambiguity – drug development is always a process of trial and error with no guarantees of success. Despite the ongoing challenges, biotech leaders who responded to our surveys remain confident. Globally 92% of respondents and 95% of China-based respondents are confident that they will meet their next investment milestone. That confidence extends to their expectations about their products’ success with 91% of global respondents and 94% in China confident their products will succeed. Both global and Chinese biotech leaders are also optimistic that AI and digital tools will accelerate drug research and development in the coming years. Resilience and optimism are essential qualities to manage the challenges biotech professionals face daily within the lab and from the world outside. When those qualities are matched with sustainable funding, biotech companies and ultimately patients, will benefit in the long run.
¹ Haydock I. Scrip Asia 100 Industry News & Insights. Pharma Intelligence UK Ltd/Citeline. https://insights.citeline.com/scrip/focus-on-asia/scrip-asia-100/. Published 2025. Updated October 2025. Accessed 10 November, 2025.
² Harutyunyan A. Cancer R&D Partnerships, M&A and Ventures – H1 2025 Review. DealForma. https://dealforma.com/cancer-rd-partnerships-ma-and-ventures-h1-2025-review/. Published 2025. Updated 2 September. Accessed 15 October, 2025.
