;) VC funding has consistently remained robust and elevated above prepandemic levels (Exhibit 2).
Amid a challenging public-market environment, venture capital (VC) funding has provided a much-needed lifeline to fuel biotech innovation. Despite also registering a decline after peaking in 2021, with several investments occurring in down or flat rounds,4Gabrielle Masson, “After pandemic sugar rush, a market ‘hangover’ opens biotech to funding approaches steeped in stigma,” Fierce Biotech, October 9, 2023.;) VC funding has consistently remained robust and elevated above prepandemic levels (Exhibit 2). In 2022, start-ups secured more than $22 billion in funding across early- and late-stage rounds from venture capitalists; 2023 is also shaping up to be a solid year, with more than $12 billion raised through quarter three. Overall declines have largely been driven by a lower number of deals, while median deal size has remained consistent. Investors continue to favor innovation, with Series A funding rounds accounting for almost half of all deals (Exhibit 3).