UK biotech VC rises 44% to £270m in Q3 as Basecamp Research's AI round leads

UK biotech companies raised £270 million in venture capital in the third quarter of 2026, a 44% increase, according to figures the BioIndustry Association (BIA) published on 26 October¹. That lifts the year-to-date total to £2.8 billion, and the BIA says 2026 could produce the sector's largest VC haul since 2021¹.

What the figures show

The quarter's rise came while UK venture investment fell across all industrial categories¹. AI-led drug discovery accounted for the largest single round. Basecamp Research closed a £104 million Series C, which it plans to spend on training its next generation of AI models and moving AI-designed medicines towards clinical testing¹. Draig Therapeutics and Mironid followed with second rounds of £49 million and £27 million¹.

The UK took 26% of European biotech venture funding in the quarter, out of a European total of £1.1 billion, keeping its position as the top destination in the region¹.

The headline year figure rests heavily on one deal. Isomorphic Labs' £1.6 billion Series B makes up much of the £2.8 billion raised so far this year, and the BIA describes the third quarter as "in line with broader UK venture investment trends"¹.

Below the large rounds the picture is weaker. Seed funding fell to £12 million across four deals and mid-sized rounds were scarcer, which BIA chief executive Prof Chris Molloy identified as the quarter's weak spots¹. Follow-on financing reached £151 million, nearly all of it from Silence Therapeutics' £130 million Nasdaq raise, which preceded Merck KGaA's $1.3 billion takeover offer for the company¹. The UK sector has now gone 17 quarters without a biotech IPO¹.

What it means for the market

For investors and corporate development teams, the data point to a UK market where capital is following AI. Molloy said the overlap of life sciences and AI is what distinguishes the UK, with "big pharma, big tech, and US investors" backing companies there¹. He cited NVIDIA's two investments in the past month in London start-ups Prima Mente and Boltz Bio¹.

The money is concentrated, though, in a small number of large, late rounds, much of it from overseas. Molloy said "too few British investors are taking part" in either private or public markets, so gains are not being recycled into the UK ecosystem¹. For early-stage founders, the £12 million seed total suggests that first institutional money is harder to raise than the headline figures imply¹. With no IPO window and follow-on capital dominated by one Nasdaq raise ahead of a sale, exits for UK biotechs are running through trade sales and US listings rather than London¹.

Caveats

The figures come from a trade body's quarterly report and are reported here through one news account¹. A single Isomorphic Labs round distorts the year-to-date total, so the comparison with 2021 says more about one company than about the sector's breadth¹.

Ahead of this week's Autumn Budget, the BIA is asking the government for preferential access to UK R&D infrastructure for domestic life sciences companies and a tax system with "enhanced R&D tax credits and incentives for reinvestment at its core"¹.