Another week, another biotech prepares to go public. That’s how it seems this year, with more than two dozen biotechs going public to date–with more in the works, including two this week. It’s the largest biotech IPO class since 2021.
These aren’t the mega-IPOs of the likes of SpaceX or Anthropic. Though some of the newly public biotechs have reached multi-billion-dollar valuations in the public markets, others trade well below $1 billion, like gene-editing tools startup Scribe Therapeutics. Biotechs typically go public before bringing in revenue because they need so much money for development, so this isn’t unusual.
The biggest of this year’s crop, by market cap: Veridermics ($4.9 billion). It’s working on an extended-release pill to treat hair loss, and has seen its stock soar 252% since its February IPO. Founder Reid Waldman, a dermatologist and alum of the 2024 Forbes 30 Under 30 list, has said that the boom in weight-loss drugs showed the viability of consumers paying directly for treatment. Investors are now convinced that hair loss could be “the next weight loss,” he’s said.
Others that IPOed this year and now sport market caps above $1 billion include Parabilis Medicines ($3.3 billion), which is developing cancer therapies based on a novel class of peptides, and Braveheart Bio ($1.7 billion), which is coming up with treatments for serious cardiovascular disease. But both have seen their shares fall since their IPOs, with Parabilis down by 19% and Braveheart by 36%.
“The quality of the IPO companies has been relatively strong, but there has been a lot of investors crowding into these deals,” says Chris Bardon, managing partner at biotech investment firm MPM BioImpact. “[The] 2026 IPOs traded well through end of summer, but now they are hitting the reality of their valuations.”
On the docket for this week: Iambic Therapeutics, which uses AI to make new drugs, and City Therapeutics, a developer of gene-silencing therapies for deep vein thrombosis, pulmonary embolism and other diseases. Aspen Neuroscience, which is working on a cell therapy for Parkinson’s disease, and Bambusa Therapeutics, which has therapies for atopic dermatitis and eczema in early-stage clinical trials, should follow, Both filed their regulatory paperwork late last week.
AI drug discovery darling Isomorphic Labs is in funding talks at a valuation of at least $40 billion, according to Bloomberg. The Alphabet-founded firm had raised $2.1 billion led by Thrive Capital just five months ago, at an undisclosed valuation — but it’s undoubtedly a big jump. (The startup did not respond to a request for comment about the latest reported funding.)
That headline number–$40 billion–shows just how differently investors are viewing AI drug development than actual drugs.
AI for drug development is a huge area of promise both for its potential to speed an excruciatingly slow process and to address diseases that had previously been considered “undruggable.” Isomorphic has been at the forefront of those hopes, thanks to its Nobel Prize-winning CEO Demis Hassabis. “We’re aiming to redefine the way we create medicines,” Isomorphic President Max Jaderberg told Forbes earlier this year. The company has signed partnerships with Big Pharma and intends to design its own therapeutics in-house–a big move for any AI company.
At $40 billion, though, investors would be valuing Isomorphic like a tech company, not a pharmaceutical one. “Quite the Demis premium,” says one venture investor, noting that it’s “hard to make sense of the valuation when they don’t have an asset in the clinic.” Consider: Revolution Medicines, which recently got FDA approval for a breakthrough pancreatic cancer drug that’s expected to quickly become a blockbuster, has a market cap of $41 billion.
