UK biotech acquisitions: examining the conventional narrative
File(s)
Author(s)
Nanda, Ramana
Li, Xuelai
Type
Report
Abstract
UK life-sciences policy has increasingly converged on the view that British biotech startups are acquired by foreign buyers too often, and that the underlying cause is a shortage of late-stage growth capital. This concern has become central to broader debates about whether the UK captures sufficient value from its world-leading science base.
Using granular data on venture capital-backed biotech startups from multiple countries, we examine startup outcomes across Europe and North America between 2006 and 2025. We find a more nuanced picture than the conventional narrative suggests. Acquisition rates of UK biotech startups are not unusual by international standards, and the high share of foreign acquirers is largely a mechanical consequence of the UK’s relative size within a global industry. Greater capital availability is associated with more IPOs, consistent with capital enabling more standalone businesses, but it is also associated with more acquisitions, not fewer. This suggests that simply increasing late-stage capital is unlikely, by itself, to materially reduce foreign acquisition rates.
Separate from this analysis, we discuss structural factors in the pharmaceutical industry that are likely to continue driving robust M&A activity in the coming decade. To understand whether the UK captures sufficient long-term value from the global biotech ecosystem, we point to important research questions whose answers can help policy makers make more informed decisions to support this important sector of the UK economy.
Using granular data on venture capital-backed biotech startups from multiple countries, we examine startup outcomes across Europe and North America between 2006 and 2025. We find a more nuanced picture than the conventional narrative suggests. Acquisition rates of UK biotech startups are not unusual by international standards, and the high share of foreign acquirers is largely a mechanical consequence of the UK’s relative size within a global industry. Greater capital availability is associated with more IPOs, consistent with capital enabling more standalone businesses, but it is also associated with more acquisitions, not fewer. This suggests that simply increasing late-stage capital is unlikely, by itself, to materially reduce foreign acquisition rates.
Separate from this analysis, we discuss structural factors in the pharmaceutical industry that are likely to continue driving robust M&A activity in the coming decade. To understand whether the UK captures sufficient long-term value from the global biotech ecosystem, we point to important research questions whose answers can help policy makers make more informed decisions to support this important sector of the UK economy.
Date Issued
2026-05-01
Citation
2026, pp.1-9
Start Page
1
End Page
9
Copyright Statement
© 2026 The Author(s). This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License (https://creativecommons.org/licenses/by-nc-nd/4.0/).
Identifier
https://profiles.imperial.ac.uk/ramana.nanda