Venture financing for U.S. cell and gene therapy startups pulled back sharply in 2025, with seed and Series A activity falling notably while China remained a relative bright spot. The pullback reflects investor cooling on capital-intensive modalities and a reallocation toward de-risked assets and later-stage programs. At the same time, overall biopharma financing showed signs of normalization: monthly totals declined from October peaks but retained meaningful deal flow, including larger rounds and a pickup in strategic M&A for assets in oncology, obesity and cardiovascular disease. Market participants described the environment as shifting from froth to selective funding based on clinical de-risking and near-term commercial potential. The trend is expected to pressure early-stage platforms to pursue non-dilutive options, partnerships, or geographic diversification to China and Europe where capital remains available.