Medtech IPO Window Shows Signs of Opening After Three-Year Drought

After a prolonged period of inactivity, the medical technology industry is seeing a resurgence in initial public offerings (IPOs), potentially signaling the end of a three-year drought. Recent months have witnessed a small burst of activity, with several companies successfully going public and raising substantial funds. However, the volatile economic landscape and lingering uncertainties continue to complicate the decision-making process for firms considering an IPO.

Recent IPO Activity Breaks the Silence

The medtech IPO landscape, which saw a significant spike in 2021 with 51 offerings, had been dormant for nearly three years. This drought was finally broken in October 2024 when Ceribell, a developer of technology for diagnosing neurological disorders, went public and raised over $207 million. This move paved the way for a series of IPOs in quick succession:

• Anteris Technologies, a heart valve developer, raised nearly $89 million in December.
• Beta Bionics, a diabetes technology firm, secured approximately $212 million in January.
• Kestra Medical raised $202 million with its public offering in March.

These successful IPOs have sparked discussions about whether the window for medtech public offerings is truly open again, potentially encouraging other companies to follow suit.

Market Volatility and Economic Uncertainties

While the recent IPO activity is promising, companies face significant challenges in navigating the current economic climate. The volatile market conditions, influenced by factors such as changing tariff policies and global economic tensions, have led to fluctuations in stock prices for newly public companies.

Ceribell CFO Scott Blumberg noted, "Because the gap in IPO activity was so prolonged — just over three years — the quality of most mature medical device companies is extremely high." This suggests that there may be several well-prepared companies waiting for the right moment to enter the public market.

However, the lack of control over market dynamics poses a significant challenge for public companies. Beta Bionics CEO Sean Saint highlighted this issue, stating, "There's a lack of control that's frustrating. The market moves, and all of a sudden, our stock moves for zero reason associated with anything with Beta Bionics."

Looking Ahead: Cautious Optimism

Industry experts are cautiously optimistic about the future of medtech IPOs. John Babitt, a partner with EY, predicts that "if the window is open in the second half of '25 … we'll see a decent amount of medtech IPOs." This sentiment is echoed by the observation of an unprecedented number of $100 million funding rounds in the first quarter of 2025, potentially indicating that more companies are preparing for public offerings.

However, some analysts, like PitchBook's Aaron DeGagne, believe that 2025 may not see the IPO surge that others anticipate. DeGagne suggests that while additional listings may occur, many companies might still prefer to wait on the sidelines for now.

As the industry watches closely, the coming months will likely provide clearer indications of whether the medtech IPO window is truly open and sustainable in the current economic climate.