Key Points

The sector saw an upturn in 2024, with 50 completed IPOs raising $8.52 billion, from $5.06 billion raised in 2023 and marking the highest total IPO value raised since 2021.

This rebound, driven by US Federal Reserve interest rate cuts, marks the highest total since 2021, said GlobalData, a leading data and analytics company.

While cautious, investors are showing increased interest in companies with strong clinical data, signalling a recovery in the public markets and a shift toward more advanced-stage biopharmaceuticals.

Completed IPOs that raised more than $100 million almost doubled, from $4.39 billion across 15 IPOs in 2023 to $7.88 billion across 24 IPOs in 2024.

The increase in the number of high-value IPOs in 2024 suggests that while public investors remain selective, increased capital availability due to interest rate cuts has facilitated investments in biopharmaceutical companies with a strong value proposition, said Alison Labya, business fundamentals analyst at GlobalData.

The largest biopharmaceutical IPO completed in 2024 was Switzerland-based dermatology company Galderma, which raised $2.48 billion, according to the report.

Galderma's IPO followed a planned IPO in February 2022 that did not close, as well as Galderma postponing its IPO in March 2023 amid market volatility.

Despite the overall increase in IPO value raised, discovery and preclinical-stage companies saw a four-fold drop in total IPO value from $490.6 million in 2023 to $112.5 million in 2024, indicating a shift in public investor preference towards more advanced stage companies, Labya added.

However, IPO activity could be dampened by an anticipated increase in private biopharmaceutical M&A in 2025 as companies seek to refill their pipelines ahead of upcoming patent expirations, said the report.

- IANS