UK biotech financing July - September 2025
New Q3 financing data reveals how these pressures are reshaping UK venture capital and exposing a fragile moment for the sector. The findings underscore the urgent need for sustained government action to unlock long-term growth capital and maintain the UK’s global competitiveness.
The first three quarters of 2025 have demonstrated the sustained, resilient strength of UK biotech innovation, with total venture capital investment reaching £1.41 billion, already exceeding the total raised in all of 2023.
UK biotech companies secured £187 million in venture capital (VC) investment during Q3 2025, representing a 46% decrease compared to the prior quarter (£344 million). This contraction followed global trends as investors showed increased caution. Despite the lower capital volume, the deal count remained the same, with fourteen VC rounds completed.
Across the first three quarters of 2025, UK companies have raised a resilient £1.41 billion in VC funding, already surpassing the £1.25 billion total recorded for the whole of 2023. Funding activity remained concentrated in later-stage financings, with limited seed-stage participation.
The UK’s trend for the quarter was consistent with the wider European market downturn. Biotech venture financing in Europe declined to £832 million (down from £1.21 billion in Q2), signalling a more selective and cautious investment environment across the continent. This contrasts with the US, where biotech venture financing increased to £4.63 billion (up from £3.96 billion in Q2), driven by specific large deals.
In public markets, macroeconomic conditions continued to constrain activity. UK-listed companies raised £29.6 million through follow-on financings compared to £16 million in Q2, while no IPOs were completed during the quarter.
The quarter also saw continued M&A activity, most notably Sanofi’s £1.18 billion acquisition of ViceBio, which underscores ongoing international confidence in the strength of UK biotech innovation and its capacity to generate strategic assets.
