While biopharma financing exit activity has remained strong through the third quarter, public-market performance for the same period was muted, with most of the yearly gains for the U.S. biotech-specific index largely driven by the first half of 2026.
Since the year started, the SPDR S&P Biotech ETF (XBI) has outperformed the broader market. But 2026’s recent quarter doesn’t reflect that trend.
While the IPO window remained open in the third quarter, overall biotech indices were largely flat, according to an October biopharma report from J.P. Morgan.
For all of 2026, the XBI has risen 29.6%, compared with 14.7% for the Nasdaq and 10.9% for the S&P 500, according to J.P. Morgan. Despite the annual gains, the XBI stayed largely flat—down less than 1%—for the third quarter, while the Nasdaq and S&P 500 each ticked up slightly more than 2%.
Overall, this year’s stronger public biotech performance has coincided with an improved IPO market, with proceeds and exits surpassing yearly totals from 2022 through 2025.
By J.P. Morgan’s count, biopharma IPOs raised $7.5 billion across 22 offerings in the first three quarters of this year. This greatly exceeds 2025’s eight total offerings, according to BioSpace’s historical data.
As of Oct. 26, at least 31 biotechs have gone public, according to BioSpace’s count, which includes October debuts and non-U.S. IPOs. This includes Parabilis Medicines’ $670 million summer debut—the largest public debut in biotech history.
The momentum doesn’t appear to be slowing down either, with at least four more biotechs lining up to join the public markets soon. The market has also been buoyed by positive investor sentiment surrounding an increasing number of reverse mergers.
