US Biotech Share Sales Deliver Biggest First Week Since 2021

Biotech share sales in the U.S. hit a record high in the first week of 2026, with over $2.5 billion raised. This marks the busiest start to the year since 2021. The surge includes Aktis Oncology's $318 million IPO, which was upsized by 50%.

Aktis Oncology's IPO highlights the strength of the market. The company, backed by Eli Lilly, priced its shares at $18, raising $318 million and signaling strong investor demand. This is the first U.S. biotech listing of 2026, indicating a potential rebound in the sector.

Market conditions and regulatory changes have improved investor confidence. A rebound in biotech share prices, a rise in acquisitions by large drugmakers, and reduced regulatory concerns have contributed to the positive outlook. The State Street SPDR S&P Biotech ETF has gained 17% over the past three months.

Why Did This Happen?

A combination of factors has fueled the recent surge in biotech fundraising. Biotech stocks have become more attractive due to favorable regulatory conditions and renewed investor interest in the healthcare sector. The sector's valuation is also seen as relatively attractive compared to broader markets.

Regulatory changes have also played a role. The U.S. Food and Drug Administration has approved several biotech drugs in recent months, which has boosted investor sentiment. Additionally, the Federal Reserve has cut interest rates, making it cheaper for biotech companies to raise capital.

The strong start to the year has been reflected in the performance of biotech ETFs. The iShares Biotechnology ETF has surged 31.1% over the past year, outperforming the S&P 500. This trend indicates that investors are seeking growth opportunities in healthcare rather than relying solely on high-flying tech stocks.

Aktis Oncology's successful IPO has further reinforced this trend. The company's shares rose 24% on their first day of trading, reflecting investor enthusiasm. This has set a positive tone for future biotech listings in 2026.

What Are Analysts Watching Next?

Analysts are closely watching for signs that the momentum will continue. While a strong start to the year is encouraging, it does not guarantee sustained success. In 2025, initial enthusiasm waned due to issues like drug pricing negotiations and job cuts at the FDA.

The success of future IPOs will depend on several factors. These include continued regulatory support, positive clinical trial results, and a stable interest rate environment. Investors will also be watching for further developments in the sector's valuation and market performance.

The biotech sector is also expected to benefit from increased M&A activity. In 2025, nearly 70 biotech deals were completed, the highest in a decade. This trend is likely to continue in 2026, providing further momentum for the sector.