Biopharma may see a happier year ahead in 2026 than in recent years, according to analysts at William Blair.
For one thing, the industry’s top stocks have recovered from lows that stretched into last spring. Blair cited the SPDR S&P Biotech exchange-traded fund (NYSE Arca: XBI), which bounced back from $66.66 a share on April 9, nearly doubling (up 85%) to $123.43 on December 19.
Another reason for optimism, the analysts wrote in a recent report, is better-than-expected policies from President Donald Trump’s second administration—from encouraging the reshoring of biopharma manufacturing in the United States to most favored nation (MFN) pricing, which has spared companies from much-feared tariffs in return for commitments to selling key drugs at lower prices to patients.
“While there are still some unanswered questions regarding drug pricing in the United States, changing frameworks at the FDA, and international threats to the U.S. biopharma ecosystem from China, we believe continued strong clinical data, commercial launches, and M&A will keep the sector performing better than the bear markets of 2021 through 2024,” concluded William Blair analysts Matt Phipps, PhD; Sami Corwin, PhD; Lachlan Hanbury-Brown; Andy T. Hsieh, PhD; and Myles R. Minter, PhD.
“As long as the sector continues to reward strong clinical results and companies are able to commercially launch drugs without significant government regulations around pricing, we believe specialist investment in biotech can continue to have strong performance.”
Below are seven biopharma-related trends for 2026 that have emerged from GEN interviews with experts and other industry stakeholders, and from reviews of reports and public statements.
AI: Focusing beyond targets, to trials and models
Artificial intelligence (AI) will continue to reshape biopharma, from big pharmas to smaller “pure play” AI-based drug developers, as the technology advances beyond target selection toward optimizing operations and managing clinical trials.
Deloitte’s 2026 Life Sciences Outlook Survey showed 78% of the 180 biopharma C-suite executives surveyed are expecting it to “play a central role in driving major change,” with 29% of biopharma leaders saying they plan to use AI tools or training to help improve workforce productivity. However, only 22% of 280 leaders in the broader life sciences (which includes medtech) acknowledged having successfully scaled AI, while only 9% reported achieving significant returns on their AI efforts. Just 14% of life-sci executives reported full implementation of AI tools into daily workflows, and another 40% are currently working toward this goal.
“People are moving from use cases to actual delivered value. For pharma companies, that entails answering, what can it really do in clinical development? What can it really do in the commercial function?” Roel van den Akker, PwC’s pharma and life sciences deals leader, told GEN. “That’s where we’re moving in ‘26 and ’27: If we can shave off months and years in clinical development or do things more efficiently to get to peak sales, that’s all going to accrete to the deal models.
“People in pharma are using AI in due diligence to see what it can do and will continue to do so. It’s here to stay,” van den Akker added. “I think people are bought into what it can do, but now it’s really the year of having to deliver tangible value, both in deals and in the ordinary course of the operating cycle, for this to stick.”
One key way AI can deliver value is by managing clinical trials for drug developers. Last January, AI-based drug developer Recursion began a “ClinTech” effort designed to apply the technology toward the way it approaches clinical trials. “First, it’s really around smarter trial design programs. Second, it’s about accelerating enrollment. And the third is around enhancing evidence generation,” Najat Khan, PhD, Recursion’s CEO as of January 1, explained to GEN.
Khan is succeeding co-founder Chris Gibson, PhD, who now chairs Recursion’s board. Speaking with GEN in November, Khan articulated priorities ranging from corporate needs such as team/culture and delivering shareholder value, to showing proof of concept through its internal pipeline plus partnerships with Roche, its Genentech subsidiary, and Sanofi; to staying on top of AI tech advances via its partnerships with MIT, Nvidia, and Boltz-2.
“The next TechBio inflection point will be around how to go from potential to tangible proof points,” Khan said. “Gone are the days when an interesting model is sufficient. We need models that improve the medicines that we’re making.”
Recursion pruned its pipeline from 11 to seven programs in May, one month before a restructuring that included eliminating 20% of its workforce, about 160 jobs. During 2026, Recursion has guided investors to an early Phase I safety and PK monotherapy data readout in the first half for REC-1245 (targeting RBM39) in biomarker-enriched solid tumors and lymphoma; and to potential Phase I study launches for REC-102 (ENPP1) in hypophosphatasia and REC-7735 (PI3Kα, H1047R mutation) in HR+ breast cancer.
Another pure-play AI drug developer, Insilico Medicine, launched an initial public offering (IPO) on the Hong Kong Stock Exchange (ticker no. 3696) in late December with the aim of raising HKD 2.026 billion ($260.5 million) by offering 94.69 million shares at HKD 24.05 ($3.09) each. At deadline, trading was set to start December 30, with proceeds intended to fund drug R&D, expand its AI platform, and grow its automated labs.
Insilico’s IPO has attracted 15 “cornerstone” investors, including Chinese tech conglomerate Tencent and Eli Lilly, with which Insilico in November expanded a two-year collaboration by agreeing to partner in AI drug development. Insilico could potentially generate “over $100 million” from the pharma giant.
Insilico’s 40-program pipeline is led by TNIK-inhibitor rentosertib (ISM001-055), set to launch a Phase IIb/III study in China for idiopathic pulmonary fibrosis (IPF) in the first half of 2026. Also in 2026, Insilico plans to file IND applications with the FDA to launch trials of inhalable rentosertib in IPF and small molecule rentosertib in kidney fibrosis, both in the first half of the year.
BIOMANUFACTURING: Industry commits $480B+ to U.S. projects
Biopharma giants based in and outside the United States say they will translate promises into performance in 2026, having embraced President Donald Trump’s call to “reshore” manufacturing and R&D operations domestically—if for no other reason than to avoid having tariffs levied on pharmaceuticals manufactured outside the United States. According to the Council on Foreign Relations, biopharma giants had committed more than $480 billion as of mid-November toward manufacturing and R&D projects that are either now under construction or are planned.
Two pharma giants account for nearly one-third of that total $480 billion-plus: Pfizer and Merck & Co. have announced plans to spend $70 billion each. Pfizer chairman and CEO Albert Bourla, PhD, made the promise publicly from the Oval Office in September, where he also agreed to apply MFN pricing to drugs sold to Medicaid patients, in return for a three-year exemption from 100% tariffs. Pfizer has not spelled out where it plans to invest its capital.
Merck’s plans include a $3 billion Center of Excellence for Pharmaceutical Manufacturing in Elkton, VA, that will focus on the production of small-molecule drugs and is expected to create more than 500 full-time permanent jobs. The Center broke ground in September and is set to start operations in 2028 and begin producing drug product two years later.
Virginia enjoyed a double dose of good biomanufacturing news in 2025, as AstraZeneca in October announced plans to build a $4.5 billion manufacturing site in Albemarle County near Charlottesville, where the company plans to base 600+ permanent jobs—part of a $50 billion investment commitment to U.S. facilities. The site is envisioned to produce drug substance for AstraZeneca’s weight management and metabolic portfolio, including oral GLP-1, baxdrostat, oral PCSK9, and combination small molecule products, and has been expanded from earlier plans to include manufacturing for the company’s antibody drug conjugate cancer portfolio.
Long the runner-up to Maryland in building up the regional life sciences cluster branded the BioHealth Capital Region, Virginia is one of several non-traditional states that have begun to benefit from the prospect of a domestic biomanufacturing boom, Matt Gardner, leader of CBRE’s Advisory Life Sciences practice in the United States, told GEN.
Also set to benefit from new biopharma projects is Alabama, where Eli Lilly said on December 9 that it plans to build a $6 billion plant for producing active pharmaceutical ingredients (API) for small molecule as well as peptides such as orforglipron, the oral glucagon-like peptide 1 (GLP-1) receptor agonist for which Lilly plans to file for approvals by the end of 2026. The plant will create 450 permanent jobs and is part of Lilly’s $50 billion U.S. commitment.
New projects are also taking shape in:
- Indiana—Eli Lilly, based in Indianapolis, is constructing a $4.5 billion Medicine Foundry designed to combine R&D with manufacturing in Lebanon, IN. The Foundry is set to open in late 2027 and create 400 jobs.
- Ohio—Amgen announced in April a $900 million expansion of the manufacturing plant it is building near Columbus in New Albany, OH, raising the projected investment to $1.4 billion and projected employment to 750 jobs.
- Texas—Lilly announced plans in September for a $6.5 billion API plant at Generation Park in Houston, set to create 615 jobs.
“These are definitely locations where, generally speaking, new investment is completely additive for the industry,” Gardner said. “It’s definitely bringing the industry to some new locations.”
CANCER: Pfizer eyes “backbone” therapy; Vaccine trials progress
Long recognized as a pillar of biopharma, cancer drug and vaccine development is expected to reach several clinical milestones in 2026. On the drug front, Pfizer plans to launch two Phase III trials assessing the 3SBio-discovered SSGJ-707—which Pfizer now calls PF-08634404—a next-generation bispecific antibody being co-developed with the Chinese biopharma and designed to target PD-1 and VEGF. One trial will assess PF-08634404 in adults with locally advanced or metastatic non-small cell lung cancer (NSCLC; NCT07222566) while the other will evaluate the candidate in adults with metastatic colorectal cancer (NCT07222800).
“We also plan to initiate Phase I/II studies in liver cancer, kidney cancer, and bladder cancer, where we’ll explore ‘4404 in combination with Pacdev® (enfortumab vedotin-ejfv),” a Pfizer spokesperson told GEN.
Pfizer—which co-markets Pacdev with Astellas Pharma—agreed in July to license ex-China rights to SSGJ-707—in return for paying 3SBio $1.25 billion upfront and making a $100 million equity investment in the Chinese biopharma. The agreement also gives Pfizer an option for Chinese rights to SSGJ-707/PF-08634404, with the pharma giant agreeing to pay 3SBio up to $150 million should it exercise the option.
“Since completing the licensing agreement just six months ago, we’ve already made progress to accelerate development and execute on the promise of ‘4404. This includes opening three Investigational New Drug applications and transferring another, successfully manufacturing the first batch of ‘4404, and selecting more than 500 global clinical trial sites,” the Pfizer spokesperson said.
Pfizer envisions SSGJ-707/PF-08634404 as a new backbone of cancer therapy, particularly in early stages, offering a treatment effective enough to not require chemotherapy. In doing so, Pfizer is challenging head-on the world’s best-selling prescription drug, Merck & Co.’s multi-indication cancer immunotherapy Keytruda® (pembrolizumab), which generated $23.303 billion in the first three quarters of 2025, on top of $29.482 billion in all of 2024—topping GEN’s A-List of Top 10 Best Selling Drugs, published earlier this year.
Among trials being closely watched are those related to two cancer vaccines being developed by biopharma giants. Moderna said in November that enrollment was completed in the Phase III adjuvant melanoma combination trial (NCT05933577) of the mRNA-based cancer vaccine it is co-developing with Merck & Co., now known as intismeran autogene (and formerly called mRNA-4157 by Moderna and V940 by Merck), with Keytruda. Efficacy data from the study are expected in 2026, Moderna CEO Stéphane Bancel told analysts on November 6 on the quarterly call following the release of third-quarter earnings.
The trial is one of three Phase III studies in progress for the combo of Keytruda and the vaccine candidate, an individualized neoantigen therapy (INT). The other two (INTerpath-009; NCT06623422 and INTerpath-002, NCT06077760) are designed to assess intismeran autogene in non-small cell lung cancer (NSCLC). Both NSCLC trials are enrolling patients, Moderna said in November.
The cancer vaccine is also the subject of numerous Phase II studies, of which one is fully enrolled, a randomized adjuvant treatment trial in renal cell carcinoma (INTerpath-004; NCT06307431). In December, Moderna and Merck launched a Phase II study (INTerpath-13; NCT07221474) evaluating intismeran autogene as a first-line treatment for patients with metastatic squamous NSCLC. The companies are also recruiting patients for Phase II studies in high-risk muscle invasive bladder cancer (INTerpath-005; NCT06305767), high-risk non-muscle invasive bladder cancer (INTerpath-011; NCT06833073), and in first-line treatment for patients with metastatic melanoma (INTerpath-012; NCT06961006). Moderna expects to release five-year follow-up data from another Phase II study in adjuvant melanoma (KEYNOTE_942; NCT03897881).
“We’re pleased by the growth and breadth of our clinical stage oncology pipeline and the continued strong momentum of the multiple Phase III and randomized Phase II trials within our intismeran clinical trial program conducted in partnership with Merck,” Stephen Hoge, MD, Moderna’s president, told analysts.
In October, BioNTech joined partner Regeneron Pharmaceuticals to present data at the 2025 ESMO Congress from the Phase II BNT111-01 trial (NCT04526899) evaluating their mRNA cancer immunotherapy vaccine candidate BNT111 plus cemiplimab, marketed by Regeneron as Libtayo®, in patients with anti-PD-(L)1 refractory/relapsed, unresectable Stage III or IV melanoma. The trial met its primary endpoint by showing a statistically significant, improved 18.1% objective response rate (ORR) in patients treated with BNT111 plus cemiplimab, compared to 10% for the historical control.
After 24 months, 37% of patients were still alive, while 21% were free of tumor progression after treatment with the combo. BNT111 is based on BioNTech’s fully owned, off-the-shelf FixVac platform, and encodes four melanoma-associated antigens.
“Taken together, these results support that BNT111 is active in this difficult post-IO [immune-oncology] setting and provide us useful footing to guide setting selection and optimal combinations going forward,” Özlem Türeci, BioNTech’s chief medical officer, told analysts on November 3 on the quarterly call following third-quarter results.
FINANCE: M&A, VC funding, even IPOs expected to accelerate
Market watchers are expecting to see merger and acquisition (M&A) activity accelerate further in 2026, after a year that saw a clear comeback for such deals, considered by investors to be the most lucrative avenues for cashing in on their investments. GlobalData’s Pharma Intelligence Center Deals Database recorded a 31% jump in total deal value to $179.6 billion as of December 16, from $137.1 billion in 2024, though the number of deals fell nearly 20% to 468 from 583.
M&A activity began with a flurry of deals including the year’s biggest one, Johnson & Johnson’s $14.6 billion acquisition of Intra-Cellular Therapies, then slowed down in Q2 before picking back up during Q3-Q4 as reflected by Novartis’ $12 billion acquisition of Avidity Biosciences, set to close in the first half of 2026; and the $4.8 billion buyout of Amicus Therapeutics by BioMarin Pharmaceutical, announced December 19 and expected to close in the second quarter. Pfizer won a bidding war with Novo Nordisk to acquire obesity drug developer Metsera for up-to-$10 billion, while Alkermes prevailed over H. Lundbeck to buy Avadel Pharmaceuticals for up-to-$2.37 billion.
One key driver in M&A is the scramble by biotech giants and especially big pharmas to backfill pipelines that will shrivel in the coming years due to losses of exclusivity on numerous blockbuster drugs, what the industry calls the “patent cliff.” A recent GEN A-List found that the top 20 drugs heading for the patent cliff between 2026 and 2029 accounted for a combined $176.442 billion in 2024 sales—75% of the $236 billion in annual sales set to disappear with the loss of exclusivity, a combined sales figure widely quoted by biopharma market watchers that includes Deloitte and EY.
Subin Baral, global life sciences deals leader with EY-Parthenon, said the patent cliff was just one factor behind M&A activity heating up in 2025. Would-be buyers enjoy a huge reservoir of cash, nearly $1.4 trillion set aside for dealmaking by the top 25 biopharmas—what EY-Parthenon calls “firepower.” And many would-be takeover targets are squeezed for cash, as they have drawn down on their venture financings of the COVID-19 era and soon after, only to find investors are less willing to finance them.
“If you look at the targeted assets, these are assets that are well into maturity up to Phase II, some even have marketed products. In many cases, these assets have been heavily targeted for quite some time, and now companies are pulling the trigger,” Baral told GEN.
“We do feel that the industry fundamentals continue to be strong. We are seeing a flurry of activity that is coming back, which is always encouraging,” Baral added. “We would love to see a little bit more activity in the very early, early stages of funding biotech companies. The fundings are a little bit more latter stages and involve bigger rounds, which is something that is good, but it probably would require a little bit more refocus, and the spread should be wider. Outside of that, we would expect a good year, an active year.”
Also expected to accelerate in 2026 are venture capital (VC) financings, which have skewed in recent years toward fewer and larger deals with later-stage startups. J.P. Morgan and DealForma recorded $17.1 billion biotech VC investment in 290 deals during the first three quarters of 2025, compared with $27.2 billion in 459 deals in all of 2024—a far cry from the $44.4 billion in 776 deals in 2021
Should VC financing and M&A accelerate as expected in 2026, market watchers expect the effects to spill over into the long-sluggish initial public offering (IPO) market. A GEN spot check shows 11 companies having gone public in 2025 (as of December 19), which is less than half the 24 companies that completed IPOs in 2024.
EY recorded $1.8 billion in total IPOs during the first three quarters of 2025, compared with $4 billion in 2024 and $22.7 billion in 2021.
“We needed to see a level of certainty to get back into the marketplace, confidence in the marketplace for new issues to work again,” Michael Allwin, head of biopharma investment banking, Truist Securities, told GEN. He said 2025 saw a “meaningful” uptick in non-IPO financings such as follow-on offerings, secondary stock sales, PIPEs (private investment in public equity), and convertible debt financing.
“IPOs are typically the last shoe to drop,” Allwin said. “We’re hopeful and optimistic that these trends will dovetail into a much more active IPO market in 2026. And while we’re not anticipating a resurgence in activity to the tune of what we saw at all-time highs in 2020 and 2021, we are anticipating a more normalized level of activity, maybe on parity with 2019.”
GENETIC MEDICINES: After KJ, FDA sets pathway and makes waves
Development of individualized “N-of-1” therapies for disease is expected to accelerate in 2026, following the successful treatment this past year of a boy who turns 17 months old in January. KJ Muldoon, born with severe carbamoyl phosphate synthetase 1 (CPS1) deficiency, made medical history in 2025 by becoming the world’s first patient to be treated with a personalized CRISPR therapy designed to make a correction directly to the genome.
KJ received a personalized CRISPR therapy that corrected his individual disease-causing mutation through an ongoing collaboration by Rebecca Ahrens-Nicklas, MD, PhD, director of the Gene Therapy for Inherited Metabolic Disorders Frontier Program (GTIMD) at Children’s Hospital of Philadelphia (CHOP), and her former doctoral classmate Kiran Musunuru, MD, PhD, cardiologist and professor of translational research at University of Pennsylvania’s Perelman School of Medicine.
Ahrens-Nicklas and Musunuru led a team of researchers who detailed KJ’s treatment in a study published in the New England Journal of Medicine (NEJM). “We anticipate that rapid deployment of patient-specific gene-editing therapies will become routine for many genetic diseases,” the study’s 45 authors predicted.
“I avoid using the world cure,” Musunuru cautioned in October, addressing the European Society of Gene & Cell Therapy (ESGCT) annual conference. “We have a responsibility not to exaggerate and give undue hope to the families.”
KJ’s successful treatment resulted from collaboration between the FDA and multiple academic and industry partners, including the Innovative Genomics Institute at the University of California, Berkeley; Mass General Brigham Gene and Cell Therapy Institute; Danaher; and Acuitas Therapeutics. Upon submission to the FDA of the application to treat KJ, the agency granted approval in just one week.
“We can give American children like Baby KJ a remarkable future. We need to believe in American solutions,” Fyodor Urnov, PhD, director of technology & translation at the Innovative Genomics Institute (IGI) and professor of molecular and cell biology at the University of California, Berkeley, told an audience of officials from the FDA and other agencies in June. The occasion was an extraordinary roundtable of cell and gene therapy leaders, including molecular geneticists, immunotherapists, physicians, nonprofit directors, and patient advocates.
Five months later in November, FDA Commissioner Martin A. Makary, MD, and Center for Biologics Evaluation and Research (CBER) Director Vinayak (Vinay) Prasad, MD, announced the agency’s commitment to supporting additional “N-of-1” therapies through a new “Plausible Mechanism (PM) Pathway,” designed to accelerate access to treatments, notably for ultra-rare genetic diseases affecting too few patients to sustain a randomized clinical trial.
“A plausible mechanism pathway will also be available for common diseases, particularly diseases for which there are no proven alternative treatments or in which there is considerable unmet need after use of available therapy,” Makary and Prasad added in NEJM.
Prasad came under criticism for his stricter approach to regulating drugs and approval applications, which included a preference for overall survival efficacy benchmark, more rejections of applications through Complete Response Letters, and especially for his response to the deaths of three Duchenne muscular dystrophy (DMD) patients receiving Sarepta Therapeutics’ marketed treatment Elevidys® (delandistrogene moxeparvovec-rokl).
A 16-year-old male succumbed in March to acute liver failure after being dosed with Elevidys, the only gene therapy to win FDA approval as a DMD treatment. Three months later, a second Elevidys patient of undisclosed age died. As both patients were non-ambulatory, Sarepta halted shipments of Elevidys for non-ambulatory patients and paused the Phase III ENVISION trial (NCT05881408).
Following a third death, that of an eight-year-old Brazilian boy, the FDA demanded Sarepta also pause shipments of Elevidys to ambulant patients. Sarepta initially refused before agreeing on July 21. A few days later, the FDA reversed itself, allowing Sarepta to resume Elevidys shipments to ambulant patients, after Brazilian authorities ruled out treatment with the gene therapy as a factor in the boy’s death.
The FDA changed course on Sarepta, according to news reports, following pleas to Congress, the FDA, and President Donald Trump by conservative leaders and DMD patient advocates, who launched a Change.org petition. Prasad resigned on July 29 but returned to his FDA post on August 9.
OMICS: Growth from multiomics to sequencing
From multiomics to good ol’ next-generation sequencing (NGS), several big names are expected to make big moves toward expanding their footprints in omics tools during 2026.
In spatial biology, Illumina aims to shake up the field by commercially releasing the spatial transcriptomics technology it unveiled last February at the 2025 Advances in Genome Biology and Technology (AGBT) General Meeting. That spatial technology is designed to let researchers examine the spatial proximity of millions of cells per experiment, using what Illumina says is a capture area nine times larger and with four times greater resolution than current technologies.
Illumina says its spatial tech will use a new multimodal analysis platform and be compatible with its NextSeq and NovaSeq sequencers. The longtime sequencing giant expanded into multiomics in 2024 when it acquired Fluent BioSciences, a single-cell technology developer, for an undisclosed price.
“We are expanding on the multiomics vertical and across the horizontal of the multimodal capabilities,” Steve Barnard, PhD, Illumina’s chief technology officer, told GEN in an October interview. “We are doing this because it fills a deep market need that is currently missing in providing the ability to create comprehensive biological information. We will complete that goal next year, when all the roadmap technologies will be on the market, [and we] will have a strong portfolio of products to support our customers.”
Consolidation has continued in spatial biology as Takara Bio USA expanded beyond single cell in January when it acquired spatial genomics pioneer Curio Bioscience for an undisclosed price. The deal created a combined company that added to Takara’s portfolio of single-cell genomics tools with Curio’s two spatial biology platforms, Trekker and Seeker Spatial Transcriptomics Kit. Takara in October launched a series of updates to its product portfolio designed to bring its new class of spatial technology to more researchers.
In NGS, Illumina is facing a growing challenge from Roche, which unveiled its Sequencing By Expansion (SBX) technology at last February’s AGBT. SBX combines tech that Roche previously acquired from Stratos Genomics and Genia Technologies and uses biochemical conversion to encode DNA into a surrogate molecule called an Xpandomer (50x longer than target DNA) and encodes the DNA sequence information in large, high signal-to-noise reporters. According to Roche, this enables highly accurate single-molecule nanopore sequencing using a Complementary Metal Oxide Semiconductor (CMOS)-based sensor module.
Roche poses a legal as well as commercial challenge to Illumina. In October, Roche Sequencing Solutions joined 10x Genomics to sue Illumina in a federal court, accusing the NGS leader of infringing on five single cell patents—three assigned to 10x, and two licensed by 10x from the unit of Roche’s Diagnostics division. Illumina said it “strongly denies these claims and will vigorously defend ourselves” against that suit and another focused on four spatial biology patents that were filed separately by 10x and Prognosys Biosciences.
WASHINGTON: From FDA to Trump, calmer 2026 expected
After a year in which President Donald Trump’s second administration convulsively changed how the federal agencies overseeing biopharma do their work—from research to drug approvals to health policy—at least one industry watcher expects a calmer, more consistent 2026.
Truist’s Allwin said the FDA has proven to be commercially constructive under Makary, who took office in April following nomination by Trump. Makary has called for a “New FDA” that reviews drug applications much faster, partners with industry, and applies AI and big data. In November, Makary launched a Commissioner’s National Priority Voucher pilot program, entitling drug developers to application reviews within 1–2 months rather than the standard 10–12 months—if, in return, they agree to increase affordability, manufacture the product in the United States as a national security issue, or address an unmet public health need.
“I think it’s proven to be constructive in a sense that clinical data milestones, clinical data endpoints, and things like that have actually trended in a more normalized direction,” Allwin said. “We’ve seen several normalized drug approvals and a more normalized approval cadence, as well, based on PDUFA and regular way review processes.”
“In general, I think the market has been favorable in terms of what was perceived to be significant impediments not being as much the case towards the end of the year, into ’26,” Allwin explained, adding: “Look, it’s not without its fragility, and it’s not without potential increased disruption and noise.”
That disruption was evident at the FDA, which eliminated 3,500 jobs as part of the 10,000 layoffs carried out in April by the Department of Health and Human Services (HHS) and its secretary, Robert F. Kennedy Jr. A quarter of those FDA jobs were later reinstated.
The FDA has continued to see a revolving door of officials fill, then exit, key positions. Peter Marks, MD, suddenly tendered his resignation in March after clashing over vaccine policy with Kennedy, and was succeeded by Prasad. At deadline, five people led the FDA’s Center for Drug Evaluation and Research (CDER) in 2025, with Tracy Beth Høeg, MD, PhD, named acting director in December. She succeeded Richard Pazdur, MD, who retired in December after about a month in the position. Pazdur, the founding director of the Oncology Center of Excellence (OCE), succeeded George Tidmarsh, MD, PhD, who succeeded acting director Jacqueline Corrigan-Curay, MD, JD, who succeeded Patrizia Cavazzoni, MD, who left the FDA to become Pfizer’s chief medical officer and executive vice president.
Disruption was also evident at the NIH, whose Fiscal Year 2026 budget President Trump sought to slash by 40%—a proposal rebuffed by appropriations committees of the U.S. Senate and House of Representatives. In February, the NIH imposed a 15% cap on indirect costs for research grants that was upheld by the U.S. Supreme Court.
As Trump-nominated NIH Director Jayanta (Jay) Bhattacharya, MD, PhD, took office in April, his agency axed 1,200 positions toward the 10,000 HHS layoffs. Another 2,400 jobs were cut at the U.S. Centers for Disease Control (CDC), where Kennedy dismissed all 17 members of the Advisory Committee on Immunization Practices (ACIP), naming 11 new members, several with a history of skepticism about current vaccination schedules. The reconstituted ACIP in December recommended against universal vaccination of newborns against hepatitis B.
