New report finds $5.6
billion invested in biopharma AI in 2024
SAN
FRANCISCO, Jan. 8, 2025 /PRNewswire/ -- Venture
Capital (VC) investment in healthcare grew to $23 billion in 2024, from $20 billion in 2023, as artificial intelligence
(AI) clearly established product fit in the healthcare sector,
according to the latest market insights report from Silicon
Valley Bank (SVB), a division of First Citizens Bank. AI
continues to take center stage, especially across biopharma, with
30% of healthcare investment in 2024 going to companies leveraging
AI.
With more than $5 billion in 2024,
investment in biopharma AI was the story of the year. The sector
saw a 300% increase in investment since 2023, surging past 2021
total capital invested by nearly $2
billion. Investment was largely driven by mega deals, with
deals over $100 million accounting
for 71% of total 2024 investment in biopharma AI, according to the
report.
"In 2025, we could see a steady yet modest increase in both the
volume and value of investments across various healthcare sectors,"
said Jackie Spencer, Head of
Relationship Management for Life Science and Healthcare Banking at
Silicon Valley Bank and author of the annual Healthcare
Investments and Exits Report. "However, despite this growth,
IPO activity is likely to remain subdued as market conditions
continue to stabilize and investors remain cautious. Advancements
in AI are poised to revolutionize drug development and clinical
trial management, driving efficiencies, precision, and speed in
bringing new therapies to market."
SVB's 2025 Healthcare Investment and Exits report analyzes and
predicts trends for venture capital investing, fundraising, and
exits across healthtech, biopharma, diagnostics/tools (dx/tools),
and device sectors in the US.
Key report findings:
- Seed Rounds: Seed rounds rose to 40% of all deals as
investors look forward. Among all companies receiving a seed deal
in 2024, 35% are leveraging AI – up from 25% in 2023.
- Biopharma: With AI-driven protein design gaining
momentum and results from clinical trials for AI-designed drugs on
the way, excitement for biopharma AI is expected to remain
high.
- Valuations: Valuations saw a 1.5x median increase among
companies raising after a down round.
- Healthtech: With notable raises going to companies with
proven track records and strong histories, a new crop of healthtech
startups must prove themselves quickly.
- Dx/Tools: Investments are slowly rising. Liquid biopsies
and precision diagnostics companies are showing strength, combining
their close relationship to the success of precision therapy with a
relatively untapped potential to collect and aggregate data.
- Device: Hospitals might turn out to be the key to
reviving a slow device startup space, with new IPOs largely focused
on the acute care space. Advances in imaging and monitoring tech
are restoring interest that's been lost from wearables and home
care.
Learn More
Access SVB's 2025 Healthcare Investments
and Exits report here: Healthcare Investments and Exits Report |
Silicon Valley Bank
To share its deep industry knowledge, SVB develops various
insights reports focused on sectors spanning the innovation
economy. For the complete library of SVB's signature research
reports, please visit Market Research Industry Trends &
Insights | Silicon Valley Bank (svb.com)
About Silicon Valley Bank
Silicon Valley Bank (SVB), a division of First Citizens Bank, is
the bank of some of the world's most innovative companies and
investors. SVB provides commercial and private banking to
individuals and companies in the technology, life science and
healthcare, private equity, venture capital and premium wine
industries. SVB operates in centers of innovation throughout
the United States, serving the
unique needs of its dynamic clients with deep sector expertise,
insights and connections. SVB's parent company, First Citizens
BancShares, Inc. (NASDAQ: FCNCA), is a top 20 U.S. financial
institution with more than $200
billion in assets. First Citizens Bank, Member FDIC. Learn
more at svb.com.
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SOURCE Silicon Valley Bank