Another January, another pilgrimage to San Francisco for the biotech industry’s annual reckoning. This year’s JP Morgan Healthcare Conference delivered sunny skies—a rarity that felt almost prophetic for an industry finally emerging from its brutal 2023-2024 slump. But while the mood was markedly improved, the undercurrents revealed an industry in flux: patent cliffs looming, AI moving from buzzword to business model, obesity therapies dominating everything, and hospitals quietly panicking.
Here’s what actually mattered at #JPM26:
The M&A Machine is Warming Up (Finally)
Yes, it was notably quiet—biotech investor Brad Loncar called it “the slowest JPM for news in a long time”—but don’t mistake silence for inactivity. Big Pharma is staring down a $300+ billion patent cliff through 2030, and pre-JPM transactions tell the real story: $2.6 billion poured into public biotech follow-ons in the first two weeks of January alone, the highest ever for that window.
Q4 2025 biotech venture funding hit a three-year high, and HSBC’s report confirmed what deal-watchers already knew: investors have shifted from “conservative” to “it’s time to deploy capital.” Translation? 2026 may be a banner M&A year. The whispers around Revolution Medicines (rumored $28-32B Merck bid) and the steady drumbeat of China biotech licensing deals signal that buyers are done being selective and have urgency to fill pipeline gaps.
From JPM podiums, expect smaller tuck-ins, platform acquisitions, and late-stage asset grabs across oncology, neuroscience, and anything that launches by 2028-2030. The patent cliff doesn’t wait.
Obesity: Still the Main Character
If you thought GLP-1 mania would cool off, think again. Obesity therapies absolutely dominated JPM26, but the conversation has matured considerably. This is Obesity 2.0: oral formulations (Novo launching oral Wegovy with Lilly’s orforglipron awaiting FDA action), muscle-sparing combinations to address lean mass loss, and maintenance strategies post-weight loss.
The market dynamics got real, fast. Novo’s CEO admitted that roughly 1.5 million U.S. patients are using compounded versions of Wegovy and Ozempic because “they’re price sensitive.” The pricing conversation persists and new solutions must be found, even as the market races toward a projected $150 billion by 2030.
Amgen’s MariTide Phase 2 success keeps them in the game, Pfizer’s CEO reports the company is “all in on obesity” (especially after its $10 billion buy of Metsera) and everyone’s all-hands-on-deck as the pharma-direct-to-consumer model is causing the development of a whole new biopharma expertise set.
Hot Zones That Also Carried Weight: Neurology & Oncology
While obesity stole headlines, neuroscience and oncology quietly dominated pipeline discussions. J&J’s $14.6 billion acquisition of Intra-Cellular Therapies (announced pre-JPM) validated the neuropsychiatry bet, and companies spotlighted progress in Alzheimer’s, ALS, and brain cancer therapeutics.
Oncology continues its evolution beyond checkpoint inhibitors: antibody-drug conjugates (ADCs), radiopharmaceuticals, and precision approaches targeting specific tumor types rather than broad organ categories. The conversation continued its shift from “what’s the next immuno-oncology blockbuster?” to “how do we get more durable, targeted responses with fewer side effects?”
Expect these two therapeutic areas to continue to attract heavy M&A and partnership activity.
AI: From Hype Cycle to Deployment Reality
The AI conversation at JPM26 finally grew up. Instead of breathless “AI will cure everything and solve every problem” pitches, tangible deployments and infrastructure investments captured the spotlight. Lilly and Nvidia committed $1 billion over five years to build a Bay Area AI research lab focused on drug discovery—not a pilot project, but a full-scale manufacturing facility for computational drug development.
Mayo Clinic dropped the mic: 155 AI applications currently in use, with 310 more in development. These aren’t demos; they’re live clinical tools improving diagnosis, surgery planning, and patient outcomes. A standout example? AI analysis identified that one specific anti-seizure drug doubled survival rates for glioblastoma patients—a finding human analysis missed.
AstraZeneca acquiring Modella AI signals that big pharma is done experimenting and ready to integrate AI into core R&D operations. We’ve moved from “AI as innovation theater” to “AI as competitive necessity.”
Hospitals: The Unhappy Exception
While biopharma and biotech executives radiated cautious optimism, nonprofit hospital system leaders presented a starkly different reality. The phrase that captured it? SSM Health CFO’s focus on “back to basics” as reported by STAT News.
With historic Medicaid cuts on the horizon and persistent labor cost pressures, nonprofit health systems abandoned talk of mega-mergers and aggressive payer negotiations. Instead, CFOs focused on staying solvent, operational efficiency, and integration synergies from past consolidations.
The mood: defensive, not expansive. One executive’s quote captured it perfectly: “Our desire has not been to stop the shaking—because we don’t know how to do that—but to engage and help the pieces fall in good places.”
The Undercurrents: What Else Mattered
- Notably absent? Major payers.
- China biotech competition dominated private conversations. Multiple deals (Novartis-Zonsen, AbbVie-RemeGen) showed Western pharma continue to embrace Chinese innovation—and pricing.
- Boston biotech’s health became a talking point after STAT reporters noted unusually empty flights from Logan to SFO, potentially signaling Kendall Square’s continued struggles while other regions recover.
- Policy uncertainty around Trump administration drug pricing initiatives created a curious dynamic: some companies secured “Most Favored Nation” deals, while small biotechs lobbied for exemptions from “peanut butter blanket” approaches.
- The compounding pharmacy debate exploded after Novo’s admission, raising uncomfortable questions about accessibility, safety, and whether high drug prices are inadvertently creating a shadow market.
The Vibe Check: Recovered, Not Euphoric
JPM26 felt like a sector that’s found its footing but hasn’t forgotten the fall. The weather metaphor everyone used? Actually perfect. After years of threatening black clouds and rain-soaked slogs, attendees got sunshine—but nobody’s willing to declare permanent clear skies just yet.
The biopharma and biotech industries at least are fat (capital is back), mostly happy (sentiment improved), but still hungry (patent cliffs demand action). 2026 will test whether this recovery has legs or if we’re just enjoying a brief respite before the next storm.
How are you planning to engage in 2026? Whether you’re hunting for acquisitions, deploying AI, navigating policy headwinds, or just trying to keep the lights on, I’d love to hear what you’re focused on this year.
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