Are European biotech VCs under pressure to scale? Time to get pragmatic 

Asabys Partners, a Spanish venture capital (VC) firm focused on healthcare, has rolled Aliath Bioventures (formerly Alta Life Sciences) into its platform in a move that boosts its assets under management (AUM) from €300 million ($348.4 million) to over €400 million ($464.5 million). The teams will co-manage the Alta Life Sciences Spain I FCR fund together with AltamarCAM, and key Aliath partners, Montserrat Vendrell and José María Fernández, will become partners at Asabys. Does that move reflect a potential trend in the European biotech VC landscape?

On paper, no new capital was injected; this is not a fresh fundraise, but a consolidation of teams and resources under one roof. Asabys frames this move as part of a longer strategic trajectory: it hopes to surpass €1 billion ($1.16 billion) in AUM by 2030, expanding into a full “life sciences investment platform” spanning tech transfer, company creation, scale-ups, and growth-stage ventures. 

This integration may look modest, but in a European biotech funding environment under stress, it offers a window into how VC firms are adapting. Funding in biopharma is down; Q1 2025 biopharma venture financing declined about 20% year-on-year. Meanwhile, the broader European VC ecosystem is seeing deal counts drop and megadeals dominate. 

What the Asabys-Aliath integration reveals about Europe’s biotech VC market

The Asabys-Aliath integration may seem like a straightforward reshuffle, but it might capture a broader reality in European biopharma venture capital: the need to scale in a tougher market. As Sergey Jakimov, managing partner at LongeVC, put it, “Boosting AUM and adding expertise signals a push for scale in a competitive market facing funding declines. It’s a strategic move to strengthen Europe’s ecosystem against U.S. dominance, not just internal tweaks.” 

Europe’s VC ecosystem has become more concentrated as limited partners (LPs), the investors who supply capital to VC funds, grow increasingly selective, channeling commitments toward established managers with proven track records. Smaller or first-time funds, which once thrived in a more buoyant fundraising climate, now struggle to attract commitments. Biopharma venture funding in Europe is down, and global deal counts have dropped as investors consolidate their bets. “This move signals pressure to scale amid tougher fundraising and selective LP commitments,” said Jakimov. “With biopharma VC down significantly, smaller funds struggle, pushing integrations like this for better deal flow and expertise.” 

“What drives these kinds of moves is primarily tougher fundraising and LPs’ focus on scaled managers, plus synergies in expertise and portfolios. Europe’s biotech faces regulatory hurdles and capital gaps, making integrations a survival tactic,” said Jakimov. 

Against that backdrop, integrations like Asabys absorbing Aliath are less about headline-grabbing expansion and more about pragmatic adaptation, pooling talent, networks, and capital without the lengthy process of raising a new fund. As Jakimov noted, such consolidations “help deploy larger capital for extended R&D cycles,” a crucial advantage in biotech, where the road to exit is long and capital intensity high. Though still relatively uncommon in Europe, such moves may foreshadow a gradual shift from a patchwork of smaller players to a handful of more resilient, specialized investment platforms. 

How does the European VC landscape look?  

European VCs are no longer just adjusting structures; they are changing how they invest, partner, and position themselves for survival and growth. Jakimov noted, “post-pandemic corrections and economic headwinds are driving efficiency through mergers, especially in biotech hubs like Spain and the U.K.” This hints at more than cost-cutting or staff reshuffles; it indicates a deeper rethink of how a VC operates in a more constrained environment. 

First, fundraising is more arduous. In that climate, European biotech VCs can’t lean on momentum; they need conviction and discipline. Some firms are narrowing their target portfolios, investing more selectively, and doubling down on companies that can clear higher scientific and clinical bars. A number of industry observers report that VCs are increasingly backing startups only when there is strong in vivo data, clearer clinical pathways, or more tangible de-risking before major rounds. 

Second, VCs are placing more emphasis on strategic partnerships and external expertise. In a less forgiving market, the ability to co-invest with pharma, tap into translational networks, or leverage external scientific or operational infrastructure becomes a differentiator.   

Finally, cautious optimism and differentiated bets are the default posture. According to Grant Thornton, while the life sciences VC downturn has dragged volumes, deal activity appears to be stabilizing, and the deal sizes among later rounds are inching upward again. That suggests VCs are quietly rebuilding confidence by doubling down on fewer, higher-conviction plays rather than scattering funds thinly. Combined with policy pushes to unify the European Union biotech environment, there is reason to believe the next phase will reward discipline. 

Here is how Jakimov described the current biopharma VC landscape in Europe: “Cautiously resilient but selective, with funding stabilizing at lower levels post-2025 Q1 drop. Strengths in academic hubs and policies like Horizon Europe, but challenges in initial public offerings (IPOs) and talent retention. It’s a buyer’s market demanding discipline.” 

So yes: while full mergers remain unusual, what we’re seeing now is a change in mindset. European biotech VCs are adapting not just by consolidating, but by evolving their investing behavior, partnerships, and cost structures.