The following are excerpts from The Boston Globe story originally published on August 26, 2025:
The industry group MassBio released its annual temperature check on the state’s biotech industry Tuesday, and the results are grim.
Both public and private funding have plummeted as federal policy changes have thrown the biotech sector into an era of uncertainty. Venture capital investment in Massachusetts-based companies dropped more than 17 percent to $2.75 billion in the first half of 2025, compared to the same period in 2024, the lowest level since 2017.
Massachusetts is also projected to receive around $463 million less in National Institutes of Health funding this year than it did in 2024, according to MassBio, a trade and lobbying organization for the life sciences industry.
“It has been a very challenging year for the industry, but when I look at the report, I know none of the numbers are particularly surprising,” said MassBio CEO Kendalle Burlin O’Connell. “Disheartening? Yes. Surprising? No.”
The outlook isn’t all doom and gloom. Because Massachusetts has long been established as a biotech hub, the state has fared better than others in weathering the turbulence of the market.
Massachusetts job totals for research and development fell 1.7 percent from 2023 to 2024. New Jersey and Maryland each lost 6.7 percent of their R&D jobs in the same period.
Massachusetts also accounted for 22.5 percent of venture capital funding for the first half of 2025, second only to California, with 45.2 percent. The next closest state, Washington, received only 3.7 percentof the venture capital investment.
Drug development is continuing in Massachusetts despite the funding struggles, with the number of drug candidates in the pipeline in July 2025 outpacing the number in July 2024.
Even the vacant lab space, which is at nearly 36 percent, according to brokerage firm Newmark, could be beneficial, said Burlin O’Connell.
“For so long, we were almost at 100 percent capacity, so companies didn’t even have an option of where to go and how to get there,” she said. “Now we have vacancy, we have space available, and that creates optionality for these companies.”