Key highlights from October:

• Biotech markets remained divergent in October, with large pharma (+8.6%), specialty pharma (+7.2%) and large-cap biotech (+6.4%) outperforming, while small-cap (6.0%) and micro-cap (15.1%) biotech declined; the NBI gained 2.9% despite a (3.5%) decline in the broader biotech basket, and year-to-date performance diverged further, with large-cap biotech up 43.8% and micro-cap biotech down (4.4%)
• M&A activity rebounded to 8 transactions (vs. 4 in September), with 4 deals exceeding $1bn, led by Shionogi/IntraBio ($2.0bn), Viatris/Pacira BioSciences ($1.65bn), Ferring/Gameto (up to ~$1.4bn) and Merck KGaA/Silence Therapeutics ($1.3bn); acquisitions spanned marketed assets and development-stage programs, with Viatris paying a ~45% premium for Pacira and Merck KGaA paying a 130% premium for Silence and its Phase 3-ready polycythemia vera candidate divesiran
• Licensing, partnership and asset-sale activity increased to 38 transactions (vs. 32 in September), with 12 carrying potential consideration of $1bn or more; China outbound deals again featured prominently, led by Hansoh/Roche’s ADC agreement (~$15.5bn; $400mm upfront; WW ex-Greater China) and Abogen/Novartis’ autoimmune agreement (up to ~$7.8bn if all options are exercised; $575mm upfront). Other major agreements included Regeneron/Sanofi’s $8.0bn expansion into four long-acting antibodies ($1.0bn upfront; 50:50 cost and profit sharing) and Gilead’s $1.9bn Vir collaboration and $1.3bn upfront acquisition of PepStar’s oral IL-23R inhibitor program
• Biopharma IPO activity accelerated to seven offerings raising ~$1.1bn (vs. two offerings in September), with 9 companies publicly on file with the SEC; October IPOs traded up 17.2% on average through month-end, led by Lycia (+66.7%), Iambic (+48.8%) and City Therapeutics (+24.4%), although the median return was flat and average pricing was 1.0% below the filing-range midpoint
• Follow-on activity rebounded to 12 priced deals raising ~$2.8bn (vs. 7 deals / ~$1.2bn in September), while the average file-to-offer discount widened modestly to (4.6%) from (3.9%); 8 of the 12 offerings followed major catalysts, including Vaxcyte ($500mm), Disc Medicine ($450mm) and Rapport ($200mm). Private financings declined to 18 deals raising ~$2.2bn (vs. 24 deals / ~$2.2bn), with large rounds including Dren Bio ($350mm) and Pathos AI ($237mm at a $3.0bn post-money valuation)
• Treasury’s October 22, 2026 NPRM implementing the COINS Act (comments due December 7) added biotechnology as a prohibited sector for US outbound investment into China-connected entities; cash-only ex-China licenses remain out of scope, but several key terms (“joint venture,” “direction or control,” and the anti-evasion standard) are undefined or broadly drawn, and industry commenters are seeking clarification on how they apply to common cross-border licensing and company-formation structures
• Drug-pricing policy remained a central industry issue, as CMS finalized its GLOBE most-favored-nation pricing model for selected Medicare Part B drugs and PhRMA sued to overturn the rule, escalating the industry’s legal challenge to international-reference pricing