Senior Editor: Alan Agbele
Despite the AI boom drawing record venture capital, biotech startup investment has remained remarkably stable, according to Crunchbase data. While AI companies have scooped up billions, biotech funding has hovered between $36 billion and $40 billion globally for the past few years, including 2026. This steadiness stands out in a volatile funding environment. Per Crunchbase, the numbers do not paint an especially bullish picture, but they show a sector that continues to attract consistent investor interest.
Steady Funding in a Volatile Market
Overall venture investment rose to a record level in the first half of the year, driven largely by generative AI behemoths. Yet biotech startups scooped up a respectable share of what remained. For the past few years, global biotech funding has stayed within a narrow band, per Crunchbase data. This stability suggests that investors continue to see value in drug development and therapeutic innovation, even as attention shifts to artificial intelligence.
AI Overlaps Dominate Large Rounds
A handful of biotechs have secured especially large financings this year, and the standout companies are those at the intersection of biotech and AI. More than $6 billion has gone to AI-focused biotechs so far, per Crunchbase. The largest biotech round of the year was a $2.1 billion Series B for London-based Isomorphic Labs, an AI-first drug design and development company. Other notable fundraisers include Earendil Labs, which develops AI platforms for protein therapeutics, and Chai Discovery, a startup applying AI to drug discovery. Below are three of the largest AI-biotech rounds:
Not all heavily funded biotechs describe themselves as AI-centric. NewLimit, a longevity startup raising $435 million in a June Series C, focuses on restoring youthful function in old cells.
Early-Stage Dominance and Quick IPOs
While top-funded biotechs skew later-stage, the overall startup pipeline remains heavily tilted toward seed and early-stage rounds. More than half of all biotech investment this year is in early-stage companies, per Crunchbase. This pattern reflects a trend where biotechs often go public after a Series B or Series C rather than raising additional venture rounds. This year has seen several high-profile IPOs from relatively young companies. Kailera Therapeutics, a developer of obesity therapies founded in 2024, went public in April just six months after its Series B. Personalized medicine startup Kardigan debuted on Nasdaq in June after raising over $550 million. Latigo Biotherapeutics, focused on non-opioid pain treatments, completed its IPO in August. The largest biotech IPO of the year came from 10-year-old Parabilis Medicines, which raised its Series F in January. Biotech M&A also remained active, with at least 12 funded companies sold in deals valued at $1 billion or more, including potential milestone payments.
Why This Matters
The steady funding level suggests biotech has become a mature, resilient asset class immune to the extreme swings of AI hype. For investors, biotech offers a diversified path away from the volatility of generative AI mega-rounds. The convergence of AI with biotech, however, means that the largest rounds are now flowing into ventures that combine both sectors, potentially reshaping drug discovery timelines. For patients, sustained investment ensures a pipeline of new therapies, particularly in oncology, obesity and pain management. But if AI continues to absorb an outsized share of venture capital, biotechs without an AI angle may face tighter competition for later-stage funding. The healthy volume of IPOs and M&A exits indicates that the sector retains clear exit paths, which is a positive signal for limited partners. Overall, biotech is proving that steady, long-term investment can coexist with a frenzied market for AI.
