Pharmaceutical and life sciences accounted for 21% of UK healthcare M&A in 2025, down from 27% a year earlier, as inbound activity fell by more than a quarter. Heligan Healthcare’s new report paints the year as one of caution rather than acceleration, particularly for UK assets seeking overseas buyers.
Resilient, not expansive
“2025 proved to be a year of resilience rather than expansion for UK healthcare M&A,” said Ramesh Jassal, Partner, Corporate Finance, Healthcare, Heligan Group, highlighting a range of factors behind the plateau, including a cautious investment landscape, a selective private equity mood and US policy uncertainty.
The sector nonetheless demonstrated relative strength. While overall UK dealmaking declined by 10–15%, healthcare transactions held strong. “Deal volumes held steady at 280 transactions, which is notable given the broader slowdown across UK dealmaking,” Jassal added. Healthcare also outperfromed other industries such as technology, consumer and industrials, which recorded a low double digit decline in deal activity.
Biotech drives deal flow
Interestingly, a key driver was biopharma and biotechnology deals, which together represented 35% of activity. Acquirers focused on securing access to innovative drug pipelines, spanning cell and gene therapies, advanced biologics and other specialised technologies.
For example, AstraZeneca agreed a £774.2m acquisition of EsoBiotec, an in vivo cell therapy technology company in May. While Sanofi announced its £1.2bn takeover of respiratory vaccine biotech Vicebio, one of its largest biotech purchases of the year, in July.
Future outlook
Looking to 2026, Heligan expects buyers to prioritise technically complex, capability-led assets, including high-spec manufacturing, gene therapies and advanced analytics. Platform businesses with recurring, service-based revenues are also likely to attract attention as investors seek more predictable returns.
In the UK, a supportive fiscal backdrop could help drive results too, particularly in the biotech sphere. Budget commitments such as the £520m Life Sciences Innovative Manufacturing Fund, £86bn in R&D funding and continued access to Horizon Europe are expected to underpin activity, helping companies navigate cost pressures and remain attractive targets despite the fierce competition for investment.
