CAMBRIDGE (January 7, 2025)—In a sign of a biotech rebound, Massachusetts-headquartered biopharma companies received $7.89 billion in venture capital (VC) funding, marking the first year-over-year increase since the pandemic, according to a newly released year-end report from biopharma member organization MassBio. For the first time ever, the report also found that private biopharma companies based in Boston collected more venture dollars than those headquartered in Cambridge, indicating a shift in the center of gravity for mid- to late-stage firms.
“Not only is biotech back, but Massachusetts is leading the recovery with a return to the fundamentals of investment following the best science on its way to patients,” said MassBio CEO and President Kendalle Burlin O’Connell. “We saw venture firms invest in startups with promising data and pharma companies acquire and partner with companies with advanced pipelines. We also witnessed the maturation of a cluster, with Boston staking its claim as the place growing companies go to advance through the clinic, while Cambridge remained the destination of choice for early-stage startups and global pharmaceutical companies. With a new Life Sciences Initiative in hand, and our own MassBio Vision 2030 roadmap to follow, you can count me among those who are bullish for the local industry in the year to come.”
Click here to view and download the full 2024 Massachusetts Biopharma Funding & Pipeline Report.
Venture Capital
Massachusetts-based companies received $7.89 billion in VC funding in 2024, an increase of $220 million over 2023. This funding accounted for 28.3% of national VC dollars, second only to California (41.6%) but well above New York (6.6%). Massachusetts funding was spread across 222 rounds of investment, down from 242 rounds in 2023. The average round was $35.5 million for Massachusetts companies versus a national average of $25.2 million. Notably, while the average Series A round increased from $56 million to $65.3 million for Massachusetts biopharma companies, the average local seed round continued to decrease from $10.1 million in 2023 to $8.85 million in 2024.
Seventy-two percent of venture funding went to companies headquartered outside of Cambridge, the largest portion ever. While Cambridge (73) had more deals than Boston (62), the capital city became the champion in the venture sweepstakes with $2.3 billion in funding compared to $2.2 billion for Cambridge. Watertown, Waltham, and Burlington rounded out the top destinations for investors to find companies to support. Cambridge remains the top destination for early-stage startups and global pharmaceutical companies while growing mid-stage private companies are gravitating to Boston’s Seaport and the suburbs.
Mergers and Acquisitions
The year started with an explosive quarter for merger and acquisition activity with nearly half of the year’s deals to acquire Massachusetts-based companies (15 of 32) closing between January and March. Though the number of deals was down six from 2023, the total value surged to $42.6 billion from just $13 billion in 2023. Bristol Myers Squibb’s acquisition of Boston-based Karuna Therapeutics for $13.8 billion was the top deal of the year and promptly paid off with the FDA’s approval of schizophrenia drug Cobenfy just six months later. Massachusetts-headquartered companies acquired 25 companies in 2024, with the sale of Alpine Immune Sciences (Seattle, WA) to Vertex Pharmaceuticals topping the list at $4.9 billion.
Initial Public Offerings
Six companies tested the market by holding an IPO in 2024, easily surpassing the two in 2023. Bicara Therapeutics (Boston), Zena Therapeutics (Waltham), and Upstream Bio (Waltham) raised the most from their IPOs. At market close on December 31, 2024, the stock values for five of the six companies were trading below their initial price, with only Rapport Therapeutics showing modest gains.
Drug Pipelines
Globally, Massachusetts continues to be a strong player in drug development, with 6.4% of the worldwide drug pipeline. Nationally, the Commonwealth stands firmly in second place with 15.1% of the pipeline, a slight increase from last year’s report (14.9%). It is important to note that these pipeline numbers only represent companies based in Massachusetts, excluding those with substantial R&D operations here and headquarters elsewhere. There are 762 active clinical trials underway in Massachusetts. In 2024, 23 companies either based in or with a significant presence in Massachusetts received FDA approvals, including groundbreaking treatments for RSV, Schizophrenia, leukemia, and advanced squamous cell carcinoma.
About MassBio
MassBio is the driving force behind Massachusetts’ life sciences ecosystem, supporting innovation and industry growth by offering best-in-class resources to over 1,700 member organizations at all stages of the biopharma lifecycle. Founded in 1985, MassBio aspires to extend Massachusetts’ impact as the global center of excellence in biomedical breakthroughs. Through strategic cost-saving initiatives, robust business partnerships, educational and networking opportunities, and proactive advocacy, MassBio empowers its members to launch the next generation of medical advancements to deliver the cures and therapies that enhance patient lives.