US Life Science Tools & Diagnostics: Monthly sector health tracker (July data + 2Q26 earnings calls commentary)

Research evidence excerpt

18 August 2026

US Life Science Tools & Diagnostics

US Life Science Tools & Diagnostics: Monthly sector health tracker

(July data + 2Q26 earnings calls commentary)

Eve Burstein

Louisa Qiu

We publish a monthly life science tools & diagnostics sector health tracker to aggregate 1)

qualitative commentary from major events, and 2) quantitative data that can help us assess

market trends and sentiments. Our last published issue is available here.

From a qualitative perspective, sentiment from 2Q26 earnings calls trended more

positive versus the June conferences. Most notable was increased biotech spending

in both the clinical AND preclinical environment; while increased spending in the clinical

environment was expected, our base case didn’t include preclinical spend this early in

the year. We also saw more examples of large step-ups in pharma spend in the preclinical

environment, vs. prior periods where these step-ups were almost exclusively in clinical trials

(see our new exhibit which captures this). Beyond pharma / biotech, there were signs of

improvement in the Academic & Government end market especially near the end of the

quarter, which has been the other biggest question mark for us in the near-term recovery

story. There were other small changes (both positive and negative) that we cover later in the

note, but they are far less material than the ones we mention here.

From a quantitative perspective, July sector health metrics are still generally

improving on a TTM basis; sequentially, several metrics stepped down but we see

this more as “reversion to the mean" after very tough comps from the preceding

month / year. The cleanest positives: Drug approvals (both originators and biosimilars)

all improved sequentially. Pharma R&D was also up 8% vs. 2Q25, 1p.p. higher than

the 7% average over the last ~15 years. The most misleading negatives: Clinical trial

starts, licensing deals, and biotech funding are all down sequentially… but they are all up

considerably (10%+) on a TTM basis, so we see this as reversion to the mean. Mixed, but

maybe the most important: NIH. In June we noted a major sequential step-up in funding and

…