SNAPSHOT

Generate Biomedicines raises $400M, the biggest biotech IPO in nearly three years

AI drug discovery firm Generate Biomedicines raised $400 million in an IPO, the largest biotech stock offering since 2023, and the fifth biotech to go public in February.

Why it matters: The deal signals renewed investor appetite for later-stage biotech companies after 2025’s multiyear low of just 11 offerings and could mark a turning point after years of sluggish IPO activity.

Backstory: Founded in 2018 by Flagship Pioneering, Generate has raised over $800 million in venture funding and $110 million from partnerships with Amgen and Novartis.

Zoom in: Generate’s lead drug, GB-0895, is an AI-designed asthma therapy targeting TSLP, the same cytokine as Amgen and AstraZeneca’s Tezspire. The company says GB-0895, dosed twice yearly, could offer greater convenience than existing treatments. The drug is also in early testing for chronic obstructive pulmonary disease, with results expected this year.

Yes, but: The company shelved a COVID-19 drug in 2025 and laid off dozens of employees amid declining demand for coronavirus treatments.

Big picture: February became the most active month for biotech IPOs in over a year, with five companies raising nearly $1.4 billion. Investors are favoring firms with drugs already in Phase 2 or 3 to reduce development risk. The average IPO size in 2026 has climbed to $284 million, substantially larger than in recent years.

What’s next: Investors will watch clinical data from GB-0895 and upcoming pipeline milestones to gauge whether AI-designed drugs can deliver on their promise.

SNIPPETS

What’s happening in biotech today?

🫀 Cardio siRNA: Atrium Therapeutics has launched as a spinout from Novartis’ $12 billion acquisition of Avidity Biosciences, debuting with $270 million in cash and two preclinical small interfering RNA (siRNA) cardiovascular candidates. Led by former Avidity executive Kathleen Gallagher, the San Diego–based biotech will advance ATR 1072 for PRKAG2 syndrome and ATR 1086 for PLN cardiomyopathy, with plans to begin a phase 1 trial for ATR 1072 in the second half of 2026 and for ATR 1086 in 2027. Atrium also holds two undisclosed research targets and aims to build on Avidity’s RNA delivery platform to develop precision therapies for rare genetic heart diseases.

⚔️ GLP-1 showdown: Eli Lilly’s oral GLP-1 drug orforglipron outperformed Novo Nordisk’s Rybelsus (semaglutide) in a head-to-head trial involving nearly 1,700 people with Type 2 diabetes inadequately controlled on metformin, demonstrating superior reductions in blood sugar and body weight over 52 weeks. High-dose orforglipron lowered blood sugar by 1.9 percentage points versus 1.5 for high-dose Rybelsus, and achieved 8.2% weight loss compared to 5.3%, with similar advantages at lower doses. However, orforglipron was associated with higher discontinuation rates due to side effects. Lilly plans to seek FDA approval for diabetes later this year and expects an obesity decision next quarter, intensifying competition with Novo’s semaglutide franchise.

💉 ADC alliance: Earendil Labs has signed an $885 million licensing deal with WuXi XDC to access its WuXiTecan-2 linker-payload technology for developing next-generation antibody-drug conjugates (ADCs). Under the agreement, Earendil receives an exclusive license for specified targets and will leverage WuXi XDC’s end-to-end CRDMO platform for manufacturing, while WuXi XDC is eligible for upfront and milestone payments plus tiered royalties. Earendil is an AI-driven biotech advancing a pipeline of bispecific and multispecific ADCs, alongside its phase 1 anti-TL1A antibody HXN-1001. The partnership adds to WuXi XDC’s growing roster of ADC collaborations and reflects increasing industry demand for advanced bioconjugation technologies.

 💪 MDMA might: AtaiBeckley reported that its R-MDMA candidate, EMP-01, reduced anxiety severity in a phase 2a trial of 71 U.K. adults with moderate-to-severe social anxiety disorder, showing a placebo-adjusted 11.8-point improvement on the Liebowitz Social Anxiety Scale, which AtaiBeckley considers “clinically meaningful”, and 49% of treated patients rated as “much” or “very much improved” versus 15% on placebo. Although the study was primarily designed to assess safety, results were deemed clinically meaningful and generally well tolerated. Analysts described the drug as “high-risk, high-reward,” modeling blockbuster potential despite regulatory setbacks in the broader MDMA field, while the company’s stock fell following the announcement.

💉 Antibody boost: ViiV Healthcare, majority owned by GSK, reported positive 12-month interim results from the phase IIb EMBRACE study evaluating lotivibart, a broadly neutralising antibody, in adults with HIV on stable therapy. When administered every four months alongside monthly intramuscular long-acting cabotegravir, the regimen maintained viral suppression in 94% of participants receiving intravenous lotivibart and 82% receiving subcutaneous dosing, compared with 88% in the standard-of-care group. The findings demonstrate favorable efficacy and tolerability, supporting lotivibart’s potential as an ultra-long-acting treatment for HIV and enabling further study of a twice-yearly intravenous dosing schedule.

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