The annual report on the state of the life sciences industry in Israel produced by IATI (Israel Advanced Technology Industries) indicates continued stagnation in 2025, despite that fact that globally it was a successful year for the sector.
In 2024, the industry experienced a recovery and there was great optimism about the coming year, but in fact 2025 turned out to be fairly stagnant, with a few flickers of optimism in certain fields. In 2026, biomed is flourishing globally, but in the first half of this year too it is not clear that Israel is part of the trend.
The report, produced jointly by IATI and the Israel Innovation Authority will be presented at this week’s MIXiii Health-Tech conference run annually by IATI. It shows a decline in investment in life sciences in Israel from $2 billion in 2024 to $1.4 billion in 2025, which is lower even than the amount invested in Israeli companies in the sector in 2023, which was $1.7 billion.
The main decline is in medical devices, which was also the field that grew in 2024. Excluding the rise and fall in this field, investment in general can be described as stable since 2023.
These numbers are a long way below the investment in Israel’s biomed sector in the period of the Covid pandemic, when world attention was focused on health, interest rates were low, and money flowed to this area. Israel at that time was considered an intriguing and attractive place for investment in general and in life sciences in particular. In both 2021 and 2022, $3 billion were invested in life sciences in Israel, more than double the amount invested in 2025.
An arid year on the stock exchange
According to the report, the average valuation of companies in investment rounds also fell, as did the amounts raised. The average raise in the sector as a whole was $10 million. In medical devices, it was $6 million. Such numbers generally indicate that many companies are raising small sums simply to survive until the end of the crisis.
Nevertheless, there were some impressive investment rounds, such as by Syremis Therapeutics, which operates in Israel and the US, and raised $165 million; Empathy, which offers support at times of loss, and raised $72 million; and Eleos, which offers psychological counselling, and raised $60 million.
As far as capital raising on the public market was concerned, 2025 was a fairly arid year for Israel’s life sciences sector, even though globally it was a year that saw improvement in amounts raised for this sector on stock exchanges. Israeli companies raised just $116 million in initial and secondary offerings, which compares with $637 million in 2024 and $460 million in 2023. Most of the offerings were on Nasdaq. No life sciences company was floated on the Tel Aviv Stock Exchange last year, and secondary offerings totaled just $3.2 million.
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Some comfort can be found in the acquisitions item, which, although it didn’t grow in 2025, maintained stability. Life sciences companies were sold in 2025 for a total of $1.3 billion, which compares with $1.4 billion in 2024 and just $230 million in 2023. Excluding 2023, the 2025 total is the lowest since 2017.
The figure for 2025 changes dramatically for the better, however, if the sale of 89bio is taken into account. The company grew up in Israel, and was sold to Roche in 2025 for $2.4 billion, with the possibility of further payments later. If that deal is included, 2025 can be presented as a strong year for mergers and acquisitions.
Exports continue as usual
While events and interest rate changes and market taste have shaken life sciences startups, Israeli exports in this area remain stable. In medical devices exports have been worth $3.3.5 billion in each of the past five years, the peak being in 2023. In drugs, except for an impressive rise in 2022, there has been a decline from $2.1 billion in 2021 to $1.7 billion in 2025.
The industry employs 81,000 people, representing a good proportion of the approximately 400,000 people employed in Israel’s technology sector as a whole.
67 new life sciences companies were founded in Israel in 2025, which compares with 70 in 2024, and 53 in 2023, which was not only a tough year in Israel but also a weak year globally in biomed. There are currently some 1,800 active biomed companies in Israel.
Most of the new companies founded in 2025 deal in digital health and medical devices. The existing companies divide approximately one third in each sub-sector: digital health, medical devices, and drug development, but drug development companies employ far more people than those in the other fields, accounting for about 60% of the total number employed in the sector.
The burgeoning of digital health has changed the geographical spread in the sector. Tel Aviv currently leads with 310 companies. After it comes Rehovot, with 120 companies, and Jerusalem, with 112. Other places with a fairly high concentration of companies in the sector are Haifa, and the Sharon region (Herzliya-Ra’anana).
Published by Globes, Israel business news – en.globes.co.il – on June 28, 2026.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2026.
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