“Nuclear winter” and “extinction event” were two of the less-than-positive terms used during last month’s BIO International convention to describe the state of play for biotechs in recent years. Fortunately, while this may be only a partial exaggeration, there were many more positive notes as well.

Fresh from my third BIO International and after digesting my many pages of notes, I’ll be sharing highlights around a few key themes in this short blog series. Let’s start with biotechs. Later, we’ll cover the future of dealmaking, competitive intelligence and the role of China.

How are biotechs weathering the storm?

Let’s start with a couple of data points from the event.

• EY’s latest biotech report noted that 39% of listed biotechs have a cash runway of under a year.
• There are around 700 publicly listed biotechs on the US markets. This was described bluntly as “too many” during one panel session.

However, there are reasons to be cheerful. Several panelists representing Big Pharma said that dealmaking was always on the table, whether that’s licensing deals or M&A. And with $300bn of sales at risk due to loss of exclusivity, pipelines need to be filled. In fact, the latest news that Merck & Co. plans to acquire Verona Pharma addresses exactly that issue.

In the dozens of panel sessions held throughout the event, there was a lot of advice for biotechs who need to secure their future and several themes became apparent.

1. Plan your outreach carefully. The larger pharma players all have clear areas of focus and many of them discussed the importance of strategy and discipline in their dealmaking activity. For biotechs aiming to make a deal, it’s important to understand that strategy to ensure you invest your time in the right places.
2. Start early, communicate often. Relationships are at the heart of any dealmaking process and many of the business development and licensing panelists highlighted the importance of beginning conversations early. You may be years away from being ready to sign a deal but starting a discussion early can put you on the radar of potential partners who can also help guide your clinical processes and advise you on the studies they’d require to move forward.
3. Get your commercial data right. Investors and Big Pharma want to be sure that you’ve got a clear, granular view of your competitive landscape, your true market size and other key factors. Failure to have this data will undermine your credibility. One panelist from Stifel spoke of “informational asymmetry” which is driven by wishful thinking on the part of biotechs and results in skepticism from investors. Any gaps will be highlighted in a due diligence process, so get ahead of the game.

For biotechs with the right fundamentals – that is great science and great teams – there is still huge opportunity, even in a challenging market. While many people I heard from at the meeting expect M&A to pick up in the second half of 2025, no one was expecting the IPO window to dramatically swing open. For biotechs and their investors, this means that a mix of ruthless capital efficiency, effective story-telling, and a firm grip on your path to market are critical.

If you’d like to find out how Evaluate’s experts can help you build a data-driven story to take to potential partners, contact us here or take a look at how we help with market sizing.