Challenge: Companies need to understand and maintain the balance between organic and inorganic portfolio strategies … between different geographical and technological sources of innovation opportunity … between the search for robust financial efficiency and the need for novel partnering models to push innovation forward … and between the goals and priorities of the US administration and other policymakers.
Opportunity: The industry’s strong performance throughout the disruptions of the past year shows that biotech has the creativity, imagination and determination to meet these challenges successfully.
Learn more about the industry triumphs and challenges in this year's report.
Challenge: The industry’s innovative engines continue firing on all cylinders, with first-in-class products reaching the market. And biopharma has realized the potential to accelerate innovation. Widening the search for best-in-class R&D into historically less-established geographies and newer technologies such as the AI drug discovery engines being refined by TechBio leaders, opens new paths for the industry to develop and commercialize innovations more rapidly.
Opportunity: Staying at the forefront of innovation requires biopharmas to balance the potential for faster results and the risks involved in leaning into new sources of innovation for the future.
Challenge: VC continues to flow in, with US$20.6b raised in 2025, while 2026 saw some early major rounds and encouraging signs of revival in the IPO market. Emerging biopharma are also pioneering new financing models, including synthetic royalty agreements and innovative contracting structures.
Opportunity: The innovative capabilities of biotech are well-established — now companies need to become equally creative in redesigning financing models to secure the future of the industry.
Challenge:nbsp;Policy changes affecting the wider biopharma landscape and also changing the operating environment for biotech are ongoing, from pharmaceutical tariffs to downward pressure on prices to the onshoring drive. Wider policy commitments, including geostrategic moves which may increase pressures on supply chains, including energy prices and access to raw materials, are also a continuing concern for the sector.
Opportunity:nbsp;Companies need to consider how to balance, 1) portfolios to offset patent expiries with new pipeline assets and find the right mix of modalities and therapeutic areas to thrive, 2) future sources of innovation and leveraging the opportunities of AI to accelerate R&D, 3) the current financing pressures and demands, and 4) strategy across geographies, making use of global opportunities.