When 28-year-old Meera Rao, an Indian biotech founder, posted on LinkedIn, “We thought the check had dried up. Then, late-Sept, a lead investor called, ” it caught attention. Her startup, working on a microbial therapy for gut disorders, had been stuck in the “valley of death” funding drought. That phone call echoes a broader shift: after years of lethargy, the biotech investment market is flickering to life. A report shows the biotech industry saw a 70.9 % increase in total venture financing deal value in Q3 2025. Pharmaceutical Technology DCAT Value Chain Insights
For a sector that many wrote off when public valuations tanked, this is a hopeful turn.
Backdrop: The dried public market and VC pull-back
The piece “The Biotech Landscape in 2025 and Beyond” notes that the sector faced macroeconomic pressure, declining valuations and an almost complete IPO drought. DCAT Value Chain Insights
For early-stage biotech founders this meant tight capital, especially outside major hubs.
Signs of revival: Venture deal uptick and major acquisitions
- GlobalData reports a 70.9 % rise in biotech venture financing deal value in Q3 2025. Pharmaceutical Technology
- The funding tracker from Labiotech shows renewed activity across seed to late rounds. Labiotech.eu
- Larger strategic deals and acquisitions (see the acquisition article in news) add confidence. Financial Times
For Meera’s startup, this meant her investor pool opened again — albeit more selectively.
What’s changed: investor mindset & startup strategy
Investors are now prioritising fewer, higher-quality bets — biotech firms with clearer paths to revenue or partnerships rather than broad pipelines. Innovative Genomics Institute (IGI)
Founders report emphasising realistic milestones, cost containment and strategic partnerships (Meera shifted her business model accordingly).
Lessons for founders and investors
- Founders: focus on near-term value creation (platform validation or partnerships), build lean burn models.
- Investors: be prepared for longer timelines, build domain expertise beyond tech hype.
- Ecosystem: regional hubs (including India) may benefit as global capital searches for diversified risk. Meera’s Bengaluru-based team now attracts interest from European VCs.
Conclusion
The biotech sector may not be back to the frothy valuations of 2018–19, but funding is flowing again and with a more disciplined mindset. For founders like Meera, the message is: be ready but realistic. For investors: it’s time to engage with biotech, but with due diligence.
References
- “The Biotech Landscape in 2025 and Beyond: Is a Rebound …” DCAT Value Chain Insights
- GlobalData biotech industry Q3 2025 financing report. Pharmaceutical Technology
- Labiotech 2025 biotech funding tracker. Labiotech.eu
- News item: Novartis to buy Avidity Biosciences for $12 bn. Financial Times
- News item: Biotech stocks are up again in 2025. Barron’s
