Geopolitical uncertainty has continued to “chill” IPO sentiment among British biotechs, an industry leader has told Fierce, even as the sector saw second-quarter venture capital funding reach a five-year high.
British biotechs secured 2.05 billion pounds ($2.7 billion) between April and June 2026, according to a July 20 report from U.K. trade body the BioIndustry Association (BIA). The majority of this haul came from the 1.6 billion ($2.1 billion) series B for the Alphabet-backed Isomorphic Labs in May. But even excluding this injection of Google cash, the remaining 498 million pounds ($669 million) raised by British biotechs was still close to double the 279 million ($375 million) raised over the same quarter last year.
This strong showing means the U.K. “strengthened its position as Europe’s leading biotech investment destination,” the BIA said in its report, with the nation accounting for 61% of Europe’s 3.3 billion pounds ($375 million) of VC capital raised during the second quarter.
“Beyond the headline megadeal, the funding landscape became increasingly balanced,” the BIA noted in its report. “Seed investment remained resilient, with eight seed deals completed during the quarter and rounds averaging 6.4 million pounds [$8.6 million] as companies bypassed smaller historic structures to raise substantial first financings.”
While it was good news on the funding front, a hoped-for resurgence in public listings among British biotechs has yet to materialize. Back in January, industry insiders were optimistic that the U.K would begin to produce public listings—including on the ailing London Stock Exchange—for its drug developers after a four-year drought.
But while U.S. biotech IPOs have boomed in recent months, including record-breaking Nasdaq listings from the likes of Kailera Therapeutics and Parabilis Medicines, there has not been a similar clamor on the other side of the Atlantic.
BIA CEO Chris Molloy pointed to an uncertain geopolitical landscape as the likely “major contributing factor” for this dearth of IPOs.
“We were seeing companies at the back end of last year, right into the early part of this year, considering a route to public finance,” Molloy told Fierce in an interview. “Obviously … the Middle Eastern conflict has chilled most global markets.”
“That's going to put companies on a pause,” he added. “If you're looking to a public market, you want to look to a public market where there is confidence and consistency that can be priced in.”
Michal Berkner, head of the EMEA biotech team at law firm Baker McKenzie, pointed out that the broader U.K. IPO market has been showing “early signs of recovery.” However, this has “not been the case for biotech companies, highlighting the disconnect between market reforms and the sector's appetite for risk.”
“There are several reasons why the U.K. biotech IPOs market has remained stagnant, including the continued pull of Nasdaq and a U.S. listing and the relative buoyancy of the M&A markets," said Berkner, who is based in London.
“Biotechs weigh the pros and cons of a listing, especially the costs of going public and ongoing reporting, and market liquidity and momentum play a key role in the assessment of which market is most attractive for life science companies,” he told Fierce.
Still, Berkner is optimistic about the longer-term view: “As the broader U.K. IPO market continues to show signs of revival, we are confident that biotech IPOs will also make a return to U.K. listings,” he added.
The BIA’s Molloy told Fierce that British biotechs are still looking to access the public markets, but described a pause in those plans as “sensible” as these companies wait for the markets to settle.