The life sciences IPO market has experienced a dramatic shift following the deluge of deals during the Covid years of 2020-21, with deal volumes well below historical means over the past three years and through the first half of 2025. The dollar amounts tell an equally stark story, with total proceeds falling from over $20 billion in peak years to less than $3 billion in recent periods. Rising interest rates, market volatility, federal agency uncertainty and investor skepticism have created a perfect storm that has left many promising life sciences companies shelving their public offering plans indefinitely.
However, this challenging environment shouldn’t derail your communications strategy – it should reinforce its importance. Markets are cyclical, and companies that emerge the strongest when IPO windows reopen will be those that used this slowdown to build their investor relations and communications foundation.
Think Beyond Market Timing
If you are handling investor relations or communications for a private life sciences company, it’s important to operate from the assumption that an IPO will happen in the future. This mindset allows you to build discipline and lay a solid foundation that serves multiple strategic purposes – whether your company goes public next year or in five years. The most successful life sciences IPOs don’t happen because companies get lucky with timing. They succeed because companies spent years building the investor relations and communications infrastructure (alongside the R&D) that enables them to execute flawlessly when market opportunities arise.
Building Your Investor Relations Foundation During the Slowdown
Develop a Consistent Narrative Across All Audiences
Your IPO success hinges on a compelling investment narrative that resonates with institutional investors. Use this time to refine your story and validate the market opportunity with credible data and milestones. The most successful life sciences IPOs present clear paths to product approval and sustainable competitive advantages that differentiate them in crowded therapeutic areas.
Start Building Buy-Side Relationships Now
Begin cultivating relationships with healthcare-focused institutional investors, analysts, and portfolio managers. These connections take time to develop and cannot be rushed during TTW (“Testing The Water”) meetings and the IPO roadshow. Regular updates on clinical progress, partnership announcements, and regulatory milestones keep your company on their radar for when you do go public. Developing relationships with Sell-side banker and Analysts will also help in this endeavor.
Establish “Normal Course of Business” Investor Relations Activities
The SEC’s quiet period restrictions mean you can only continue “normal course of business” activities during IPO processes – you cannot start new investor outreach initiatives. If you want to maintain visibility with investors during your quiet period, you need to establish regular investor relations rhythms now. This could include quarterly updates to key investors, participation in healthcare industry conferences, or regular analyst briefings.
The Communications Component That Supports Your Investor Relations Efforts
Third-Party Validation Matters to Investors
Key opinion leaders, patient advocacy groups and clinical investigators who understand your therapeutic area(s) can provide credible perspectives that enhance your IPO narrative. These relationships cannot be built overnight or during the compressed timeline of an IPO process. They require consistent cultivation and authentic engagement over extended periods.
Media Relationships Pay IPO Dividends
Having established your story through media relationships developed prior to the quiet period mitigates the possibility for misperceptions about what your company does, particularly if you have a complex offering. Business and financial journalists covering life sciences have long memories, and the relationships you build during quiet periods often prove most valuable during high-stakes IPO moments.
The Coordinated IPO Approach
When the time comes to go public, you’ll need a specialized, coordinated investor relations and communications approach:
- Investor Education Materials: Your investor relations team, internal or external, needs to have content that translates complex science into compelling investment narratives for different institutional investor segments
- Coordinated Messaging: investor relations and communications must deliver consistent stories across all stakeholder groups
- Listing Day Execution: Success requires precise coordination, prioritized outreach strategies to media contacts, and contingency plans for various scenarios
You will want to consider partnering with an agency that has deep experience in both the investor relations and communications aspect of life sciences IPOs. The process can be unpredictable, and having seasoned professionals who have navigated these waters before is invaluable.
The Strategic Value Beyond Going Public
Maintaining an IPO-ready mindset delivers benefits that extend far beyond a stock offering. Companies with strong investor relations and communications foundations are better positioned to
- Navigate partnership discussions and M&A opportunities with clear, consistent messaging
- Communicate clinical trial results effectively to all stakeholder groups
- Weather regulatory challenges and competitive threats while maintaining credibility
- Execute strategic pivots with shareholder confidence
Conclusion: Preparation Meets Opportunity
Rather than viewing the current IPO drought as a reason to delay communications planning, consider it an opportunity to build competitive advantages. The life sciences companies that emerge strongest when markets reopen will be those that used the time wisely – building relationships, refining narratives, and establishing communication and investor relations disciplines that serve them when opportunities arise, regardless of market conditions.
Whether it’s six months or two years from now, preparing for an IPO should start well in advance. Having everything in place is the key to success, and as communications and investor relations professionals, we know that time is not always your friend.
Start building that foundation now, and you’ll be ready for whatever opportunities the market recovery brings.
