Questions remain as to how long this bifurcation will continue and whether we will first see a slowdown in VC activity or an increase in public-market enthusiasm.
Data from the first three quarters of 2023 shows VC funding continuing to level out from 2021 highs but remaining above prepandemic levels. This continued resilience contrasts starkly with public markets, which have remained hesitant about biotech throughout 2022 and 2023. Questions remain as to how long this bifurcation will continue and whether we will first see a slowdown in VC activity or an increase in public-market enthusiasm. It might be that public investors cannot tolerate the typically extended time horizons toward profitability in the sector, while VC investors are comfortable waiting for the results of biotech innovation.