Life Sciences Funding in View: 2025 Outlook

Venture Capital

U.S. Markets VC investment volume rose across most hub markets, continuing to capture the lion’s share of funding, with 69% of total VC flows in 2024 directed toward these areas. The San Francisco Bay Area led with $8.5 billion in deal volume (+25% YOY), including the year’s largest deal only billion-dollar transaction, Xaira Therapeutics. Average deal size in the Bay Area climbed to $28 million (+33% YOY). Deal activity was softer in Boston at $7.1 billion (-12% YOY) and an average deal size of $26 million (-1% YOY). San Diego experienced robust growth, reaching $3.7 billion in deal volume (+115% YOY), with deal size increasing to $35 million (+125% YOY). Philadelphia recorded $632 million in deal activity (+21% YOY) with an average deal size of $13 million (+60% YOY). Raleigh- Durham posted $762 million in volume (+32% YOY), including the second-largest deal of the year — $480 million funding of Areteia Therapeutics. Deal size in Raleigh-Durham averaged $22 million (+115%). The Suburban Maryland market saw declines in both deal volume, down to $280 million (-22% YOY), and deal size, averaging $10 million per deal (-3% YOY).

Secondary markets also saw notable gains, New York and Los Angeles-Orange County rounded out the top five markets. Deal activity in New York totaled $1.8 billion (+102% YOY), with an average deal size of $26 million (+217% YOY). The Los Angeles-Orange County market posted $1.5 billion (+34% YOY) in deal volume, with average deal size of $27 million (+217%). Seattle experienced a drop in volume, totaling $482 million (-14% YOY), though deal size increased to $17 million (+42% YOY). Emerging markets reported significant deal activity in 2024. Deal volume in Houston totaled $285 million (+70% YOY), with an average deal size of $9 million (+118% YOY). Minneapolis saw deal activity rise to $394 million (+88% YOY) with an average deal size of $17 million (+186% YOY). Austin also experienced robust deal growth, with $349 million in deal volume (+34% YOY) with an average deal size of $17 million (+124% YOY). CRE VIEW: VC funding remains critical for the CRE recovery in hub markets. Increased deal activity in these markets is expected to influence vacancy rates and asking prices over time.

11 / CUSHMAN & WAKEFIELD

LIFE SCIENCES JANUARY 2025