Q1 IPOs Rise From Q4, But Unstable Markets Could Slow New Offerings
There were six biopharma initial public offerings on Western stock exchanges, including five in the US, during the first quarter, but plunging stock values could halt further IPOs.
There were six initial public offerings by biopharmaceutical companies on Western stock exchanges during the first quarter of 2025, up from four in the fourth quarter of 2024, but all of the IPOs occurred in January and February – perhaps a sign that stock market turmoil in March and in the early days of April are halting new first-time offerings.
Five of the six IPOs launched so far in 2025 occurred in the US, with one company listing on the SIX Swiss Exchange on 7 February – BioVersys, which grossed CHF76.7m ($89m) to fund its antibiotics development programs. The six IPOs in Q1 of this year grossed a combined $0.92bn, before inclusion of shares sold for overallotments, versus $0.67bn for the four IPOs in Q4 of last year, according to data from Evaluate Pharma. The average IPO size dipped to $153.3m in Q1 of 2025 from $167.5m in Q4 of 2024.
The health of biopharma stocks has declined significantly since the start of this year, with the closely watched XBI fund experiencing its largest single-day decline of 2025 on 4 April, closing down 5.7% from the prior day and continuing to decline 7 April, closing down 0.91%. It is down 20.26% year-to-date. The XBI started 2025 at $91.53 per share and has not traded above that price since 21 February, when it closed at $91.70.
The average IPO size dipped to $153.3m in Q1 of 2025 from $167.5m in Q4 of 2024
The XBI and Nasdaq Biotechnology Index (NBI) as well as broad US stock indices have all plummeted in recent days. The XBI and NBI, which is down 11.1% year-to-date, have been stung by massive staff cuts at the US Food and Drug Administration, including Center for Biologics Evaluation and Research (CBER) director Peter Marks, a champion for vaccines and novel cell and gene therapies.
Stock prices across all industries have plummeted due to hefty tariffs on imports into the US, announced by President Donald Trump on 2 April. While pharmaceutical products are excluded from the tariffs, for now, the US trade policy shift sank broad stock indices for the third day in a row, with the S&P 500 closing the week ending 4 April down 9.1% and down another 0.23% on 7 April, a loss of 13.74% year-to-date. The Dow Jones Industrial Average fell 7.9% for the week ending 4 April and dropped another 0.91% on 7 April, with a total loss of 10.44% year-to-date.
Macroeconomic uncertainty is bad for riskier asset classes, such as biopharma, which is why the XBI and NBI are sinking despite the industry’s exclusion from the Trump Administration’s tariffs. Investors are likely to be cautious about new investments in the drug development space for some time, as long as macroeconomic turmoil and FDA-related regulatory uncertainty persist.
The five biopharma companies that went public in the US in Q1 delivered an average one-day return of 15.2%, with three firms closing in positive territory on their first days as public companies. However, as of 4 April, all but one of the companies is trading in negative territory, with an average return versus IPO values of -24.4%. (See table below.)
The largest IPO this year was obesity drug developer Metsera’s offering in January, which grossed $316.2m, including overallotments. Maze Therapeutics, which went public on the same day, grossed $140m for its rare disease programs.
Aardvark had the smallest biopharma IPO in the US this year, grossing $97.9m, including overallotments. Despite developing treatments in the usually highly valued metabolic disease space, the company also had the year’s worst first-day performance.
The first drug developer to launch an IPO in the US in 2025, cancer specialist Ascentage Pharma, was the only company still trading above its offering price as of 4 April. The offering grossed $142.5m after overallotments.
Sionna Therapeutics went public in early February to fund its clinical trials in cystic fibrosis, grossing $219.2m after overallotments, but its stock is one of the worst performers of this year’s IPOs, down 44.6% as of 4 April.
BioVersys has performed relatively well since its IPO in Switzerland, closing at CHF35.55 ($41.37), down just 1.3% from its CHF36 ($41.90) offering price.
With poor post-IPO performance for most drug developers that have gone public this year, it may be hard for investors to justify support for additional first-time biopharma offerings in 2025.
Company
IPO Price
Gross Proceeds ($m)
First Day Close
Return Vs. IPO
4 April Closing Price
Ascentage Pharma (AAPG)
$17.25
$142.5
$17.38
0.8%
$20.95
21.4%
Metsera Inc. (MTSR)
$18
$316.2
$26.50
47.2%
$16.80
-6.7%
Maze Therapeutics Inc. (MAZE)
$16
$140
$15.95
-0.3%
$9.07
-43.3%
Sionna Therapeutics Inc. (SION)
$219.2
$25
38.9%
$9.97
-44.6%
Aardvark Therapeutics Inc. (AARD)
$97.9
$14.31
-10.6%
$8.16
-49%
Total: $915.8
Average: 15.2%
Average: -24.4%
