Biotech stocks are rallying, with the iShares Biotechnology ETF (IBB) up 24% year-to-date and Moderna surging 587%. Analysts attribute the boom to clinical trial successes, increased M&A activity, and advancements in new drug technologies such as genomics, mRNA, and AI. The global AI in drug discovery market is projected to grow from $20 billion in 2025 to over $160 billion by 2035. Biopharma dealmaking reached $134 billion in the first half of 2026, up from $112 billion for all of 2025.