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EY Biotech Beyond Borders Report 2025: Focus on fundamentals to bounce back
In this report, we take a closer look at how the world has changed and how that shift has impacted the biopharma sector at large, as well as the strategies that will position the industry for long-term success even as uncertainty persists.
The 35th annual EY Biotech Beyond Borders report finds the biopharma industry at a crossroads with history, where sentiment and numbers do not always align. Since the pandemic, the biotech industry has been going through a down cycle, but the numbers show financing returning to the sector in 2024.
Yet, a clear picture of the haves and have-nots has persisted, with only a small number of companies having access to capital while others need to cut costs and create operational efficiencies.
This picture is further complicated by the macroeconomic uncertainty. The advent of tariffs into the economic policy landscape has greatly increased uncertainty and market volatility for both biotechnology companies and investors – creating an environment that makes corporate M&A and IPOs highly unlikely.
Public company revenue over the last four years was nearly
more annually than in four years.
The overall biotech workforce dropped
to 288,195 employees.
EY Biotech Beyond Borders Report 2025
Despite pessimistic views of the biotech market, US and European public biotech revenues were strong in 2024, growing 6.8% year over year to $205 billion. Public company revenue over the last four years was nearly $50 billion more annually than in the four years prior. Yet, 2024 still had companies operating at a deficit, reporting an aggregate loss of $26.8 billion.
Biopharmaceutical companies are already feeling the effects of new tariffs on Canada, Mexico, China, and other nations subject to universal 10% tariff rates. While pharmaceutical products have historically been exempt, materials used to package and produce drugs could be impacted. The industry will be further affected by impending sector-specific tariffs.
Heather Meade
Principal, Washington Council, Ernst & Young LLP
Biopharma companies continue to face a challenging financing environment that has only been made more complicated by a rapidly changing world and political environment. The ongoing hurdle for biopharmas will be to adapt their business models to a new, highly compartmentalized world and to update tax and operational strategies to fit the demands of the new norm.