Healthcare AI Funding: A Quarter-by-Quarter Analysis

All funding deals in the healthcare AI market over the last years

Below is the table listing all the deals. You can find our methodology at the end of this page.

If you want a deeper understanding of the market and its current dynamics, get our report covering the Healthcare AI Market.

Is Healthcare AI funding actually growing right now?

Healthcare AI funding is currently growing much faster in dollars than it is in actual deal activity.

We counted 75 financings in Q2 2025, followed by 66, 68, 64 and 66 over the next four quarters. Since Q3 2025, the market has basically stayed in a narrow mid-60s range. There is no obvious wave of more companies suddenly getting funded.

Capital tells a very different story. Funding moved from $1.99 billion in Q2 2025 to roughly $1.7–1.8 billion for the next three quarters, then jumped to $3.53 billion in Q2 2026.

The underlying market moved far less. Once we exclude rounds above $50 million, Q2 2026 comes down to $791 million, 8.5% above Q1 and still below the $934 million recorded one year earlier. The median round also slipped slightly from $12.8 million to $12.25 million.

Normal funding activity is fairly steady. The big change is that a handful of companies can now raise amounts large enough to transform an entire quarter.

Quarter	Deals	Total capital	Capital excluding >$50M	Median round
Q2 2025	75	$1.99B	$934M	$10.0M
Q3 2025	66	$1.82B	$728M	$10.0M
Q4 2025	68	≥$1.81B	≥$748M	$10.5M
Q1 2026	64	$1.70B	$729M	$12.8M
Q2 2026	66	$3.53B	$791M	$12.25M

Did one Isomorphic Labs round make Q2 2026 look much stronger than it really was?

Yes. Isomorphic Labs' $2.1 billion Series B explains most of the apparent explosion in Healthcare AI funding in Q2 2026.

The round alone represented about 59.5% of all capital we counted that quarter. The three largest financings accounted for 67.3%, while the top five absorbed 73.3%. One round carrying most of a quarter's capital is why we follow where the money goes and what investors back in our healthcare AI market report.

Compare that with Q4 2025, when the top five represented only 37.8% of funding, or Q1 2026 at 38.6%. Q2 suddenly looks like a completely different market because one financing became enormous.

Even the number of $100 million-plus rounds did not increase. We counted four in Q1 2026 and four again in Q2. Investors simply wrote a much bigger check at the very top.

Isomorphic's own funding announcement helps explain the scale. The company said the money would be used to scale its IsoDDE drug-design engine, grow internationally and move its therapeutic pipeline toward the clinic. Once an AI platform starts behaving more like a full drug-development company, the capital requirements change quickly.

Quarter	Largest round / capital	Top 3 share	Top 5 share	Capital from >$50M rounds
Q2 2025	18.3%	39.9%	49.5%	53.1%
Q3 2025	13.3%	33.1%	44.7%	60.0%
Q4 2025	11.0%	25.3%	37.8%	58.8%
Q1 2026	14.7%	28.0%	38.6%	57.0%
Q2 2026	59.5%	67.3%	73.3%	77.6%

Did Healthcare AI funding weaken after Q2 2025?

Healthcare AI funding clearly lost breadth after Q2 2025, even though the typical round held up reasonably well.

Deal count fell 12% from 75 in Q2 to 66 in Q3. Total capital decreased only 8.5%, but the drop reached 22% once we removed rounds above $50 million.

Meanwhile, the median round stayed exactly at $10 million. Investors had not suddenly slashed normal Healthcare AI checks. There were simply fewer transactions across the market.

The quarter also became more dependent on companies that were already established. Ambience Healthcare raised $243 million and OpenEvidence raised $210 million, while the share of first financings fell from 33.3% to 24.2%.

Q3 2025 was a narrower market. Big platforms could still raise aggressively, but fewer companies were participating underneath them.

Was Q4 2025 actually the healthiest quarter for Healthcare AI funding?

Q4 2025 was probably the healthiest quarter for Healthcare AI funding breadth during the five quarters we studied.

The headline numbers were hardly spectacular. Deals moved from 66 to 68, capital was almost flat and the median increased only slightly to $10.5 million.

Underneath that, the market became much less dependent on its biggest rounds. The top three deals fell from 33.1% of capital in Q3 to 25.3%, and the top five dropped to 37.8%, the lowest concentration of the period.

New-company activity also came back. First financings jumped from 24.2% of deals to 35.3%.

Q4 had something the later $3.53 billion quarter did not: more new entrants, lower concentration and a modest improvement in ordinary deal activity at the same time. The rebound did not last into early 2026, but the quarter itself was unusually broad.

Are fewer new Healthcare AI startups getting funded now?

Yes. First-time Healthcare AI financings became noticeably scarcer in early 2026, and the recovery in Q2 was only partial.

First financings represented 35.3% of Q4 2025 deals. That fell to just 18.8% in Q1 2026 before recovering to 22.7% in Q2.

The dollar gap became much wider than the deal-count gap. First financings attracted only about $65 million in Q2 2026, compared with roughly $3.46 billion for follow-ons. Their median round was also just $2.75 million, versus $16 million for companies that had already raised. Why some young companies stall before a follow-on round is something we examine through what stalled startups had in common in our report covering the healthcare AI market.

OpenEvidence illustrates the other side of this market. Once the company had institutional backing, capital arrived repeatedly: $210 million in July 2025, another $200 million in October and $250 million in January 2026.

Our financing-status classification is intentionally conservative because public funding histories are not always complete. Even allowing for that limitation, early 2026 clearly favored companies already inside the funded Healthcare AI ecosystem.

Quarter	First-financing share	Median first round	Follow-on share	Median follow-on
Q2 2025	33.3%	$4.3M	64.0%	$15.1M
Q3 2025	24.2%	$5.75M	75.8%	$18.75M
Q4 2025	35.3%	$4.4M	64.7%	$22.0M
Q1 2026	18.8%	$3.75M	81.3%	$14.2M
Q2 2026	22.7%	$2.75M	77.3%	$16.0M

Are Healthcare AI investors moving toward more mature companies?

Healthcare AI investors are backing somewhat more mature companies today, although early-stage deal activity itself has barely moved.

Early-stage rounds represented 72.0% of deals in Q2 2025 and 69.7% in Q2 2026. Series B activity was almost absurdly stable: seven rounds in Q2 2025, seven in Q3, eight in Q4, seven in Q1 2026 and seven again in Q2.

Company age moved more. The median dropped to two years in Q4 2025, then climbed back to three years in Q1 2026 and 3.5 years in Q2. Follow-on companies in the latest quarter had a median age of four years, compared with two years for first financings.

The giant shift appears when we look at capital. Later-stage deals captured 80.7% of Q2 2026 funding. Isomorphic Labs alone explains a huge part of that change, so calling this a broad stage rotation would go too far.

What does look real is a growing separation between ordinary early-stage deal activity and the amounts available to companies that have already reached serious commercial or clinical milestones.

Are Healthcare AI rounds actually getting bigger?

Healthcare AI rounds have become a little bigger in the middle of the market, while the mega-round story remains highly concentrated.

The median rose from $10 million in Q2 and Q3 2025 to $10.5 million in Q4, $12.8 million in Q1 2026 and $12.25 million in Q2.

More importantly, the $5 million to $20 million bracket became much more common. It represented 34.7% of Q2 2025 deals, then climbed to around 44% in both Q1 and Q2 2026.

There has been no comparable explosion in the frequency of $100 million-plus rounds. They accounted for only 6.1% of deals in Q2 2026.

The Q2 average round of $53.5 million therefore tells us very little about a normal Healthcare AI financing. When the average sits more than four times above the median, a few enormous transactions are doing most of the work.

Which Healthcare AI categories are actually gaining momentum?

Clinical AI Tools currently have the clearest growth in deal activity, while Care Workflow AI remains the broadest and most consistent category.

Care Workflow AI accounted for roughly 29% to 35% of all deals in every quarter we reviewed. That is remarkably steady. Whether care workflow tools, clinical tools and life science AI count as one market is spelled out in our market report about healthcare AI.

Clinical AI Tools moved much more. Their share of deals rose from 9.3% in Q2 2025 to 18.2% in Q2 2026. We counted seven financings at the beginning of the period and 12 at the end.

Life Science AI went the other way. Its deal share slipped from 26.7% to 22.7%, even as its capital share exploded to 69.8%.

Diagnostic AI remained fairly steady. Payer AI became more visible from late 2025 onward, but four deals in Q2 2026 is still too small a base for a strong claim about the category.

The useful distinction is breadth versus capital. Clinical AI Tools are attracting more separate financings. Life Science AI is producing much larger checks.

Category	Q2 2025 deal share	Q2 2026 deal share	Q2 2026 capital share	What we see
Care Workflow AI	30.7%	28.8%	12.9%	Broad and very steady
Life Science AI	26.7%	22.7%	69.8%	Huge checks, limited breadth growth
Clinical AI Tools	9.3%	18.2%	4.6%	Strongest deal-count expansion
Diagnostic AI	20.0%	16.7%	7.6%	Fairly stable
Revenue Cycle AI	12.0%	7.6%	3.9%	Uneven
Payer AI	1.3%	6.1%	1.2%	Growing from a small base

Is Life Science AI taking over Healthcare AI funding?

Life Science AI currently dominates Healthcare AI dollars because a few drug-development companies can absorb biotech-scale capital.

The category captured 69.8% of Q2 2026 funding while representing only 22.7% of deals. Isomorphic Labs accounts for most of the gap.

Pathos AI shows that the pattern goes beyond one company. Its $365 million Series D in Q2 2025 was earmarked for its clinical-stage oncology pipeline and continued development of its multimodal oncology foundation model. Just weeks earlier, Pathos had announced a major collaboration with AstraZeneca and Tempus built around clinical, molecular and imaging data.

Those businesses eventually need to finance far more than model development. Drug assets have to be selected, licensed or discovered, trials have to be designed and run, regulatory work begins, and clinical teams grow.

Recent developments reinforce that reading. After the end of our funding window, Pathos continued adding clinical assets, including an international licensing agreement for JSKN016. Its pipeline now spans several cancer programs that the company says were identified, evaluated or accelerated through its AI platform.

This is why Life Science AI can suddenly dominate a quarter without producing more deals. The companies that make it far enough can require hundreds of millions or even billions of dollars.

Why are Clinical AI Tools getting so much more investor attention?

Clinical AI Tools are getting more investor attention because products such as OpenEvidence are showing usage at a scale that was difficult to prove a year earlier.

OpenEvidence moved from a $75 million institutional round in early 2025 to $210 million in July, $200 million in October and $250 million in January 2026.

By the January round, the company was valued at $12 billion. It said its platform had handled 18 million clinical consultations from verified U.S. healthcare professionals during the previous month and had passed $100 million in annual revenue.

The adoption kept moving after that financing. In March 2026, OpenEvidence said it had handled one million clinical consultations in a single day.

That changes the funding discussion pretty quickly. Investors can now look at actual physician usage, repeated engagement and revenue rather than mostly betting on whether clinicians might eventually adopt an AI assistant.

The category-wide numbers are still more useful than any one company. Clinical AI Tools doubled their share of Healthcare AI deals over our five-quarter period, which suggests investor interest is spreading beyond a single breakout winner.

Is Care Workflow AI losing momentum?

Care Workflow AI still has one of the steadiest funding bases in Healthcare AI, despite looking weaker in the latest capital-share chart.

The category raised $455 million in Q2 2026 after $523 million in Q1. Its share of total market capital collapsed to 12.9%, largely because Isomorphic Labs made the overall funding pool so much larger.

Deal share barely changed. Care Workflow AI represented 30.7% of all financings in Q2 2025 and 28.8% in Q2 2026, staying close to one-third of the market throughout the period.

Ambience Healthcare shows where the money is going. Its $243 million Series C was announced after the company had expanded across ambulatory, emergency and inpatient workflows and said it supported more than 100 specialties.

The commercial evidence has continued to build. In early 2026, Ambience announced enterprise deployments with MultiCare and Houston Methodist. Houston Methodist reported a 40% reduction in documentation time and 80% utilization across specialties.

More recently, Ambience has moved further beyond ambient documentation. The company introduced a broader clinical AI infrastructure called Chorus and started promoting contracts where fees are tied to measurable health-system outcomes.

Care Workflow AI these days looks less like a new software experiment and more like an enterprise deployment market.

Is Europe actually catching North America in Healthcare AI funding?

Europe has become more relevant in Healthcare AI, but North America still has the broader funding base.

Europe captured 62.8% of Q2 2026 capital. At first glance, that looks like a dramatic geographic shift.

Deal activity tells a much calmer story. Europe represented 24.2% of Q2 financings, compared with 62.1% for North America. Europe's median deal was $6.25 million, versus $14 million in North America. How European and North American healthcare AI companies line up is shown on the market maps in our report covering the healthcare AI market.

The more interesting European quarter was actually Q1 2026, when Europe reached 21 deals and 32.8% of the market without needing one giant financing to create the result.

That breadth did not fully carry into Q2. Isomorphic Labs then turned Europe's capital share into an eye-catching number almost single-handedly.

Europe clearly has Healthcare AI companies capable of raising at the very top of the global market. We still need more quarters like Q1 2026 before saying that funding activity itself has materially shifted away from North America.

Are the same investors taking over Healthcare AI funding?

Healthcare AI capital is concentrating around repeat winners, while the lead-investor pool itself remains fairly wide.

We identified 87 disclosed lead investors in Q2 2025, followed by 69, 72, 59 and 62 over the next four quarters. Most appeared only once within any individual quarter.

A smaller recurring group does show up across the period. General Catalyst, Andreessen Horowitz, Kleiner Perkins, Bessemer, GV and Insight Partners each returned across multiple quarters, but none came close to controlling the market.

Corporate and strategic investors add another layer. Their participation fell from 22.7% of deals in Q2 2025 to 15.6% in Q1 2026, then rebounded to 21.2% in Q2.

The names make the logic easy to understand. Alphabet, GV and CapitalG participated in Isomorphic Labs. Optum Ventures backed Ambience. NVIDIA and Mayo Clinic appear among OpenEvidence investors. Pathos has built operational relationships with companies including AstraZeneca and Tempus.

Corporate participation tends to appear where money alone is not enough and startups can benefit from data, compute, distribution, clinical access or pharmaceutical infrastructure.

For now, the investor base still looks broad. The much bigger concentration story is happening at company level rather than among the firms writing the checks.

Is Healthcare AI funding becoming a winner-takes-most market?

Healthcare AI is becoming more concentrated around proven companies, although early-stage startups are still raising plenty of rounds.

Several parts of our analysis point in the same direction. First financings weakened sharply in early 2026. Follow-ons captured 98.2% of Q2 capital. The top five rounds represented 73.3% of the quarter. Median company age also rose again after the unusually young Q4 2025 cohort.

At the same time, early-stage deals still made up roughly 70% of all financings, and total activity held at 66 deals.

What we have today is a two-speed market. A large group of young Healthcare AI companies can still raise seed and Series A money, while a much smaller group has reached the point where investors are prepared to fund clinical programs, enterprise deployments or category leadership with enormous follow-on rounds.

The latest $3.53 billion quarter makes this divide look even more extreme because of Isomorphic Labs. The broader concentration toward companies with proven adoption or clinical progress was already visible before that deal.

What is Healthcare AI funding actually telling us today?

Healthcare AI funding today looks active and selective, with steady deal activity underneath an increasingly extreme concentration of capital at the top.

Funding breadth has not accelerated. Since Q3 2025, deal count has stayed close to the mid-60s, and the typical round remains around the low teens in millions of dollars.

New-company funding has become harder. First financings fell sharply in early 2026, while companies that had already raised captured almost all of the latest quarter's dollars. That is one of the developments worth watching most closely over the next few quarters.

Category momentum is also becoming clearer. Care Workflow AI remains the broadest established segment, while Clinical AI Tools have produced the strongest increase in separate deals. Life Science AI has extraordinary capital needs once companies move into actual drug-development work, which can make the category dominate funding totals without dominating startup formation.

There is little evidence of a wholesale retreat from early-stage Healthcare AI. Roughly seven out of ten deals still sit at the early stage. The bigger change is that the most mature winners can now raise amounts that were unusual for Healthcare AI only a short time ago.

Strategic investors remain relevant around businesses where healthcare access, clinical data, infrastructure or pharmaceutical capabilities make a real operational difference. Lead-investor participation, meanwhile, remains much wider than the capital totals might suggest.

The easiest mistake today would be to look at $3.53 billion in Q2 2026 and conclude that Healthcare AI funding has suddenly doubled in strength. Our research points to a more specific story: ordinary funding activity is relatively stable, while a small group of Healthcare AI companies has reached a stage where investors are prepared to finance them at exceptional scale.