The U.S. biotech capital markets remain the sophisticated in the world — and they continue to serve as the financial engine behind scientific progress. But the landscape has changed. What was once a hyperactive, momentum-driven environment has matured into a more selective, more disciplined ecosystem — one that still rewards innovation, but demands a far more thoughtful approach from company leadership.
Ankit Aggarwal, Executive Director at J.P. Morgan, provides insight into these shifts. With experience in capital raising and M&A transactions totaling in the billions, he works with leaders across biotech and life sciences to navigate financing strategy, investor sentiment, and the evolving path to the public markets.
From Surge to Strategy
The COVID-era saw record-breaking biotech IPO volumes and capital formation. But what followed was a necessary and, in many ways, healthy correction.
“We’re in a more rational market now,” Aggarwal says. “The exuberance of 2020 and 2021 brought a lot of companies’ publics that perhaps weren’t ready. What we’re seeing now is a recalibration — and that’s not a bad thing. It’s a market that still rewards the right stories, but with a higher bar.”
What’s Working in 2025
Valuations have stabilized, with the “sweet spot” hovering around the $1 billion mark — a level that matches current investor expectations. As per Ankit “In today’s market, successful IPOs tend to follow a distinct framework: Late-stage or de-risked platforms with strong clinical data or a clear regulatory path, Marquee healthcare specialist investors already in the book, Significant insider support covering much of the offering before launch, well defined value inflection points within 6–18 months post-IPO”
“The test-the-waters (TTW) process, once viewed as a prelude, is now a core part of market discovery. Companies are doing 60-plus TTW meetings in many cases,” Aggarwal notes. “It’s not just investor education — it’s about listening to feedback and refining the strategy before you’re live.” These practices—several of which Aggarwal has helped institutionalize —are now being applied across a range of biotech IPOs.
The Shift in Capital Strategy
The playbook for accessing capital has evolved, and CEOs need to shift with it. According to Aggarwal, the companies that are executing well today share a few traits:
They start early. Investor conversations begin well before a transaction is planned.
They value investor quality over valuation. Long-term alignment matters more than short-term optics.
They prioritize optionality. Cash is strategic, and raising at the right time unlocks flexibility.
They see IPOs as a starting point. Going public is a value creation event — not an exit.
“In this environment, success is more than the strength of the science. It’s about how prepared the company is to operate as a public entity — how they communicate, how they build the syndicate, how they execute.”
Reading the Room: Investor Sentiment Today
One major shift has been the pullback of generalist investors. While specialist healthcare capital remains active, it’s more concentrated — and more selective. “There’s still meaningful capital available,” Aggarwal says, “but it’s flowing within a more structured framework. The days of broad-based demand for every biotech name are behind us, and companies need to be honest about where they stand in the market's eyes.”
What’s Next: A Market Rebuilding with Purpose
Despite the tighter capital environment, Aggarwal remains optimistic. “This is a good kind of correction. It’s weeding out companies that weren’t ready and clearing space for stronger, better-positioned businesses.”
Mr. Aggarwal has been a key contributor in the Biotech space and has helped define how institutional investors evaluate readiness and sustainability in the post-COVID biotech landscape. He expects follow-ons and alternative financing structures — like PIPEs and strategic licensing deals — to remain important levers, especially as IPO activity ramps back up selectively. And over time, he believes the market will not only reopen but rebound with stronger foundations.
“The companies that emerge from this cycle will be more focused, better capitalized, and better governed. And the ecosystem will be better positioned to support real innovation.”
About Ankit Aggarwal
Ankit Aggarwal is an Executive Director at J.P. Morgan in New York, where he leads capital markets and strategic advisory for healthcare companies. He has advised on multibillion-dollar M&A and equity financings, contributing to how innovation is funded. He is a advisor to CEOs, boards, and institutional investors across the global healthcare landscape. Mr. Aggarwal has done his MBA from NYU Stern and B.Tech+ M.Tech from IIT Bombay.