January 31, 2025
January 31, 2025
Is biotech on the rebound in 2025? On the heels of this month's JP Morgan Healthcare Conference (JPM) – attended by investors and executives from the world’s largest pharma companies, innovative biotechs and digital health companies – we've been closely monitoring industry conversations and analyzing the trends we believe will dominate discussion this year.
Growth, innovation and AI again dominate that list. Here's what we're seeing:
A Resurgence in Dealmaking
JPM 2025 saw a burst of dealmaking, with major announcements setting an optimistic tone for the year. Johnson & Johnson’s $14.6 billion acquisition of Intra-Cellular Therapies stood out alongside deals from GSK, Gilead and others. While deal volumes remain below pre-pandemic levels, this year’s pace is an encouraging sign.
Looming patent cliffs are one of the drivers behind this renewed M&A enthusiasm. As several blockbuster drugs approach the end of their exclusivity, pharmaceutical companies are seeking acquisitions and partnerships that expand their pipelines. This underscores the urgency – particularly for companies in preclinical or earlier stage trials – for biotechs to sharpen their value propositions to demonstrate the long-term impact they can bring potential partners.
<split-lines>"While deal volumes remain below pre-pandemic levels, this year’s pace is an encouraging sign."<split-lines>
AI’s Maturing Role in Drug Development
The role of AI in life sciences continues to evolve, with both headlines and JPM satellite events showcasing how deeply embedded it has become. Once a promising add-on, AI is now viewed as a non-negotiable component of modern drug development. This evolution has been fueled by collaborations between big pharma and TechBio companies – many of whom were in attendance. For example, Nvidia was a visible presence, announcing new partnerships, while Recursion and Ginkgo Bioworks hosted events to discuss AI advances and share technology.
What has now shifted about the AI conversation is the sophistication and nuance surrounding its use.
JPM again spotlighted the progress AI is making in reducing the time and cost associated with the discovery part of the long journey to bring a drug to market. This is not a new conversation, although the sheer number of drug candidates that have been discovered is impressive. JPM also drove deeper discussions about the use of AI across other aspects of development – such as clinical trials – as a means of improving the process. The dialogue has also expanded to AI’s use for other aspects of healthcare, from pathology to clinical care.
Aside from JPM-focused buzz, we’ve been tracking evolving conversations around the lofty expectations now placed on AI (i.e., to solve all challenges in drug development at once). Executives remain optimistic yet pragmatic when it comes to these loftier goals. Most seem confident that AI – alongside talented professionals – will ultimately revolutionize how we develop drugs. But, they are also clear that the modest gains made in speeding drugs to market in the meantime – even if incremental to start – represent an all-around win for patients.
<split-lines>"Once a promising add-on, AI is now viewed as a non-negotiable component of modern drug development."<split-lines>
China’s Rise in R&D Innovation
China’s rapid ascent in biotech was another trending topic at JPM, and it continues to garner attention. A recent report revealed that China now contributes 23% to the global pipeline of drug candidates. China is already a notable supplier of medicines and drug ingredients globally.
With this rise comes geopolitical tensions and regulatory uncertainties, painting a complex picture of what happens next. The potential for U.S. policy changes, such as those proposed in last year’s Biosecure Act, adds unpredictability for those collaborating with Chinese companies. This is particularly true as the new administration begins to take action, with potential tariffs being discussed. In the U.S., while China’s rise means increased competition in an already tough funding environment, there’s plenty of ongoing innovation – with companies like Antheia, for example, using novel biomanufacturing methods to transform essential medicine supply chains.
While we don’t yet know what will happen next, the conversation is sure to intensify.
<split-lines>"In the U.S., while China’s rise means increased competition in an already tough funding environment, there’s plenty of ongoing innovation..."<split-lines>
Looking Ahead
Other trending topics emerged, including innovative therapeutics like radiotherapy and cancer vaccines, women’s health; and digital tech and the role of virtual healthcare.
All told, it’s clear that while the biotech sector still faces lingering headwinds, we are starting off strong – led by cutting-edge innovations, partnerships and the widespread use of AI. While uncertainties remain, the recent JPM news cycle points to a stronger future.
For biotech communicators, realizing that positive future will likely entail:
- Putting a finer point on scientific storytelling and value propositions (including leveraging their most compelling storytellers);
- Developing clear AI and tech narratives that showcase the rationale and differentiated impact of their approach, and;
- Delivering transparent communications surrounding not only successes but also the failures so inherent to the sector.
Biotechs are often shooting for the stars – seeking to transform care, save lives and revolutionize how we treat disease.
We’re confident we will see some of that ambition and innovation come to light in 2025.
Lastly, stay tuned for more analysis from Mission North’s Life Sciences Practice!
