Biotech valuations and funding availability went into reverse in the second half of 2021, following a period of abundant financing. Meanwhile, big pharma companies face their own problems, with many billions of dollars of drug sales at risk as patents expire over the coming years.
Despite this, the industry’s fundamental strength, its broad base of innovation, along with patients’ ongoing need for better therapeutics, should carry it through to better times, according to most executives we surveyed.
“We saw a lot of companies in 2024 go through workforce reductions and budget decreases, but leading indicators suggest that the market’s poised to make a comeback in 2025,” said Leslie Orne, President and CEO of consulting firm Trinity Life Sciences.
“Public biotech companies have had a turbulent year, with the XBI ETF [US biotechnology exchange-traded fund] down considerably from 2021 highs and flat in 2024 YTD. As a result, we’ve seen pharma tightening their belts, particularly given post-COVID budget restrictions, the IRA [Inflation Reduction Act, which ushers in drug price negotiation for Medicare], general election year uncertainty, and the broader macroeconomic environment.”
However, she cited reasons for optimism: “Total pharma sales continue to grow, and with projected growth, many companies are expecting to restore SG&A and R&D spend in 2025 and beyond. This trend will continue with more than 50 new approvals anticipated in 2024, and an increase in overall drug pipeline and number of active clinical trials. Additionally, biotech funding has reached its highest levels since 2021, with a surge in September 2024 reigniting confidence and positivity moving into 2025.”
Emergence From Downturn
“The biopharma industry is in a significantly stronger position compared to this time last year, buoyed by the recovery that began in 2024,” said Colleen Acosta, CEO of Freya Biosciences, a Danish firm developing microbial immunotherapies for reproductive system diseases. “We have seen more financings, and IPO activity picking up again – signalling improving market confidence.”
Renée Aguiar-Lucander, former CEO of Calliditas Therapeutics, agreed: “The market looks poised to recover in 2025 after a steady but volatile improvement over the course of 2024. With good science and the right team in place, biotech companies will hopefully be able to raise the money they need to develop their products in the private market, especially if this is matched with a good communications strategy and underpinned by a strong company culture.”
With good science and the right team in place, biotech companies will hopefully be able to raise the money they need to develop their products in the private market.
Renée Aguiar-Lucander, former Calliditas Therapeutics
However, others noted that the sector remained fragile.
“2024 was another challenging year for biotech, which underperformed the market. As folks turn to 2025, I’m hearing a mixed outlook for the year, split between ‘the sector broadly will outperform’ and ‘the sector will have in-line performance.’ A small percentage believes the sector will continue to underperform,” commented Sara Bonstein, CFO of Bridgewater, New Jersey-based biotech Insmed Incorporated. She went on: “The main macro drivers for market performance in 2025 will be interest rates, M&A activity – always a wild card – and clinical readouts. I expect there will be some volatility in the market and that selectivity will continue.”
Aguiar-Lucander and Bonstein both flagged political shifts as a risk, but not an outsized one. “There are uncertainties over how the Trump presidency will shape the industry in the US and beyond, as well as concerns about the geopolitical situation in Europe. But the industry is being driven forward by AI, novel treatments in CNS and obesity and the demand for better treatments for chronic diseases, and a growing number of therapies for previously untreatable rare diseases,” said Aguiar-Lucander. For Bonstein, “uncertainty remains at the federal level around healthcare policy, creating volatility, but current valuations likely reflect these fears. With interest rates likely continuing to fall, capital access should be easier for companies with a ‘risk-on’ mentality for earlier-stage assets.”
“The biotech sector has emerged from a period of restructuring with healthier fundamentals, but uncertainty lingers,” said Chris Hollowood, CEO of UK life science investment firm Syncona. “Whilst we can’t write off the possibility of further macro issues stuttering a recovery, cost of capital and access to capital have both improved. Cash is now being deployed at scale, but more selectively, with a set of companies that are generally better quality after consolidation and rationalization. Later-stage assets remain very attractive, whilst earlier-stage companies need to do more to de-risk and demonstrate the value of their programs.” Insmed’s Bonstein had a similar view, saying “We will see outperformance from companies with relatively derisked stories with an emphasis on quality.”
For Hollowood: “This adjustment should strengthen the sector in the long term. The convergence of this correction with improving financing conditions is providing a gradual path out of the bear market, and this makes us cautiously optimistic for 2025.”
Ali Pashazadeh, CEO of health care consultancy Treehill Partners, felt that recent changes have been more fundamental. “Going into 2025, the industry appears to finally have appreciated that things are not going to be ‘going back to normal’ – we have sustained geopolitical uncertainty coupled with supply chain instability and local in-market policy changes in key markets, to name just a few factors that drive what is a risk-averse capital market that continues to believe it will find a better risk-return profile when investing in other industries,” he said.
“Until the risk-reward of pharmaceutical product invention and clinical development improves materially, the industry is unlikely to attract incremental funds and therewith re-ignite development strategies that we were used to seeing in the few years before COVID,” he continued. “Now certainly, if pools of capital are restricted then there should be natural preselection of potential winners early on, hopefully translating into a larger ratio of ultimately successful products. However, challenges do not ‘stop’ at availability of capital – the industry also has to continue evolving by leveraging cutting-edge technologies (beyond AI) into rethinking how it can support the patient of tomorrow.”
Until the risk-reward of pharmaceutical product invention and clinical development improves materially, the industry is unlikely to attract incremental funds.
Ali Pashazadeh, Treehill Partners
Innovation
“The start of a new year can bring uncertainty but equal parts anticipation for what’s to come; however, one constant remains: the innovation that biopharma and biotechnological research and development companies bring to help protect health and wellbeing,” said Silvia Taylor, executive vice president, chief corporate affairs and advocacy officer at vaccine company Novavax. “Success in 2025 will rely on delivering novel products that target specific unmet medical needs.”
“Despite the industry facing headwinds that include the IRA drug pricing negotiations, uncertainty around the direction of the new administration on healthcare, and the public distrust toward the industry, 2025 is poised to be a positive year for investment and innovation,” declared Steve Butts, CEO of Morrisville, North Carolina-based biotech firm Arrivo BioVentures. “Companies are advancing biomarker research, genetics, and inclusive clinical trials to target specific patient populations. There is a greater focus on attacking the root causes of disease through epigenetic mechanisms. And finally, the industry is refocused on tackling global health problems like diabetes, heart disease, and mental health, affecting millions of people. We fully expect to see continued acceleration in scientific breakthroughs and transformative care in 2025.”
“As we look ahead to 2025, the biopharma industry continues to make strides, particularly in therapeutic innovation,” said Robert Lisicki, CEO of Zura Bio. “One example is the emergence of bispecific antibodies, which combine dual mechanisms of action and offer the potential for improved outcomes in diseases such as cancer and autoimmune disorders. These advancements mark an exciting chapter in innovative therapies, creating new opportunities to address unmet medical needs.”
We fully expect to see continued acceleration in scientific breakthroughs and transformative care in 2025.
Steve Butts, Arrivo BioVentures
“Targeted protein degradation (TPD) offers a novel approach in drug discovery, enabling exploitation of a cell’s proteostasis system for therapeutic benefit, with bifunctional PROTACs and monovalent molecular glue degraders (MGDs) emerging as effective therapies that can overcome some traditional drug discovery challenges,” said Christian Dillon, chief scientific officer of TPD-focused developer PhoreMost. “In 2025, we expect to see the first Phase III clinical readouts for a PROTAC; an important milestone in the TPD community, further validating this approach and its potential impact on patient outcomes.”
He went on: “Within oncology, we hope to see continued investment into degrader-antibody conjugates (DACs), where tumor-specific degradation could help reduce damaging side effects of many current treatments. We also expect new degrader targets to emerge outside of oncology, pushing TPD further into areas such as inflammatory diseases and neuroscience. With so many pioneering companies working in the TPD space, powerful new screening technologies and drug discovery platforms will propel this modality to address undruggable targets with safe, effective new therapeutics.”
“With the growing arsenal of therapeutic modalities ranging from bispecific antibodies to small-molecule degraders to RNA medicines, we are entering a golden age of pharmacology,” agreed Trace Neuroscience CEO Eric Green. “We will see an increasing number of potential medicines taking different approaches to the same targets and competing on safety, efficacy and accessibility for patients.”
“In 2025, I anticipate biopharma will maintain its momentum in driving innovation, especially in rare diseases and oncology. Artificial intelligence and machine learning will continue transforming drug discovery, improving efficiency and accelerating development timelines,” said Mark Youssef, global head of business development and licensing at UK AI-powered drug discovery firm Healx. “However, the funding landscape, while resilient, will see increased scrutiny on clinical trial data and the long-term value of therapies. Biotech companies lacking clinical-stage assets will face ongoing challenges in attracting investment. Strategic partnerships and M&A activity will remain crucial in the AI-driven drug discovery sector, enabling access to complementary technologies and expertise. Following the significant M&A trends of 2024, we expect this activity to intensify, shaping the industry’s evolution.”
Acacia Parks, advisor to contract research organization Lindus Health, highlighted digital health advances, predicting 2025 would bring “a surge of companies shifting from the relative safety of non-regulated digital health to pursuing FDA clearance for digital products, driven by new payment and coding for digital therapeutics – momentum that builds on the FDA’s impactful 2024 outreach efforts, such as sending Digital Health Center of Excellence members to conferences to engage directly with DTx stakeholders.”
“With R&D pipelines ready to be replenished, we’re seeing an increasing demand from biopharma to access academic innovation. Despite this, there remains a notable gap between the two. Academics continue to produce some of the sector’s best ideas but, too often, they are unable to progress these ideas towards clinical development. We recently created Slingshot to translate academic drug discovery ideas into medicines and expect to see more efforts to bridge the gap in 2025,” said Edward Hodgkin, managing partner at Syncona and executive chair of Slingshot Therapeutics. “We think new business models, more accelerators and a wave of co-creation will emerge, facilitating the pathway from university science to commercial reality.”
Business models, more accelerators and a wave of co-creation will emerge, facilitating the pathway from university science to commercial reality.
Edward Hodgkin, Syncona
Policy And Regulation
Some executives expressed concern over bottlenecks to progress that regulators sometimes represent.
“As we head into 2025, the biopharmaceutical industry can look forward to new technologies – from bispecific antibodies and gene and cell therapies – that hold great promise of improved and potentially curative treatments for diseases with high unmet need. However, multiple challenges could hinder the industry’s continued successful innovation cycle. Policy changes threaten to reduce protection periods that are essential for reinvestment in future innovations, lengthy regulatory and reimbursement approval timelines require urgent reform, and empty coffers are putting increasing pressure on healthcare costs,” said Astellas’s chief commercial officer, Claus Zieler.
“Overcoming these challenges requires a collaborative response from industry, governments, and healthcare systems. We must partner with authorities to maintain appropriate intellectual property protection periods, streamline regulatory and reimbursement pathways, and develop sustainable funding models that enable innovation and access,” Zieler said. “Protecting the innovation cycle is vital, enabling global healthcare ecosystems to thrive as engines of innovation, delivering groundbreaking therapies to patients that need them most.”
We must partner with authorities to maintain appropriate intellectual property protection periods, streamline regulatory and reimbursement pathways, and develop sustainable funding models that enable innovation and access.
Claus Zieler, Astellas
“The FDA’s capacity and focus will remain a critical factor in shaping biotech innovation, but staffing and budget constraints are likely to persist under the incoming administration,” warned Martin Mackay, executive chairman of rare-disease-focused Rallybio. “While initiatives like the Cancer Moonshot have driven meaningful change in oncology, similar progress in other disease areas will require significant investment and prioritization – an unlikely outcome given current political and fiscal realities. As we chip away at Eroom’s law [which says that the number of drugs approved per $1bn R&D spending halves every nine years] and more drugs are discovered using AI, the FDA will have an influx of submissions for regulatory review. To effectively advance AI-driven drug discovery, the FDA will need to hire talent fluent in AI and computational approaches, not just pharma. Without the addition of this expertise, timelines for approving innovative treatments may remain stagnant, limiting the industry’s ability to deliver new medicines quickly to patients.”
“Looking ahead to 2025, the biopharma industry faces a period of increased uncertainty, particularly in terms of global regulatory alignment and market access. Changes in US leadership, including potential shifts in FDA priorities, could have an international impact, affecting how biopharma companies navigate regulatory processes and supply chain dependencies,” said Joel Eichmann, managing director of Green Elephant Biotech, a German firm that makes sustainable labware. “From a European perspective, this underlines the importance of diversifying regulatory and manufacturing strategies to mitigate risk. Companies are likely to place greater emphasis on regional manufacturing capabilities, cross-border collaborations and the use of data-driven tools to adapt to an evolving regulatory landscape. While uncertainty presents challenges, it also offers opportunities for innovation and resilience as biopharma prepares for the unexpected.”
Scott Weintraub, senior vice president, US business at Alexion, AstraZeneca Rare Disease, struck a positive note: “I’m optimistic that federal and state policymakers will recognize the significant unmet needs of people living with rare diseases and the need for a regulatory and policy environment that supports rare disease research and innovation. In Congress, I expect to see continued bipartisan support for the ORPHAN Cures Act, which would restore incentives for companies to investigate the safety and efficacy of one treatment for multiple rare diseases. This legislation can accelerate scientific progress and bring hope for the millions of people still waiting for treatment options.
“In the states, there’s a move toward improving health equity for the rare disease community through better access to and coverage of genetic tests, such as whole genome sequencing. These tests can shorten the diagnostic odyssey and provide appropriate care to patients faster.
I’m optimistic that federal and state policymakers will recognize the significant unmet needs of people living with rare diseases and the need for a regulatory and policy environment that supports rare disease research and innovation.
Scott Weintraub, Alexion, AstraZeneca
“Through sound public policy, we can stimulate investment and research into treatments and improve access for the rare disease community.”
Bill Coyle, principal and global head of biopharma at consultancy ZS, highlighted the burgeoning field of obesity treatment. “I expect to see compelling evidence read-outs from studies of in-market and in-development obesity drugs. And I believe the mounting evidence of meaningful impact on weight, cardiovascular outcomes, sleep apnea, joint pain, type 2 diabetes incidence and more will cause payers and policymakers to reflect on the need to improve access to these drugs, especially as supply constraints begin to fade away and competitive rivalry increases.”
Others considered how policy and regulation could determine the success of the biosimilars market.
“In 2025, the biosimilar marketplace will be at an inflection point. With a heightened focus on delivering savings through access to high-quality, affordable medicines, the industry will face challenges to sustainability,” said Joshua Salsi, head of North America, Biocon Biologics. “Solutions such as streamlining regulatory development processes to reduce time, and cost will be pivotal in accelerating market entry while ensuring a competitive marketplace once approved. In the future, state and federal biosimilars-first initiatives will play a critical role in fostering a robust and sustainable biosimilar market. Incentivizing providers and large employers to prefer biosimilars over reference molecules will be key to driving uptake. And most importantly, patients must experience tangible cost benefits to fully realize the promise of biosimilars.”
Solutions such as streamlining regulatory development processes to reduce time, and cost will be pivotal in accelerating market entry while ensuring a competitive marketplace once approved.
Joshua Salsi, Biocon Biologics
Gillian Woollett, vice president and head of regulatory strategy and policy, Samsung Bioepis, took a similar view. “The science of biotech is at its best it has ever been, and biopharmaceutical manufacturing is ever improving. 2025 marks a decade since the first biosimilar was approved in the United States, and in the past decade, we have seen considerable progress with biosimilars in the US market. However, the pace of progress has to improve to ensure the viability of future biosimilars, and we hope that in 2025 we can see the promise of biosimilars being fulfilled through greater access by patients,” she said. “FDA, through its leadership at the International Pharmaceutical Regulators Program (IPRP), is moving ahead with regulatory streamlining in a manner that is very hopeful for their more efficient development (for example, by significantly reduced comparative clinical efficacy studies [CES]), and FDA leading with collaborations across international regulatory authorities is also giving us (and patients) great hope of global harmonized approaches that will help our quality-assured, safe and effective biosimilars become available to more patients worldwide.”
Drug Discovery Tools
“In 2025, we can expect more labs to adopt multi-omics tools for research. The major challenge in drug discovery isn’t just speed – it’s the need to shift from trial-and-error approaches to refined, hypothesis-driven methods to improve success rates,” said Molly He, CEO of Element Biosciences, which develops genetic analysis tools. “This requires access to advanced technologies that deliver deeper, multi-layered molecular insights and genomics-based information.”
She elaborated: “Multi-omics – integrating DNA, RNA, protein, and cell morphology data from the same samples – isn’t just a buzzword; it fuels the future of drug discovery and precision medicine. What’s especially exciting is that new multi-omics tools are becoming more accessible, enabling labs that previously lacked the resources to leverage these technologies for groundbreaking research. By examining the full cellular picture, multi-omics insights will enable R&D teams to identify therapeutics more precisely and understand their mechanisms of action at a deeper level at record speed. This efficiency will drive innovation, attract investment, and improve patient accessibility to new treatments.”
What’s especially exciting is that new multi-omics tools are becoming more accessible, enabling labs that previously lacked the resources to leverage these technologies for groundbreaking research.
Molly He, Element Biosciences
“After nearly 40 years in leadership positions in the biopharma industry, I see 2025 as the year of human biology,” said Harvey Berger, chairman and CEO of Kojin Therapeutics, Inc., a company developing treatments based on a form of programmed cell death called ferroptosis. “Our challenge is to develop new medicines – ideally first-in-class – that can transform the lives of patients in need of better therapies. To do so, we need to have new avenues to disease intervention and prevention. Our understanding of the molecular, genetic, and cellular basis of disease is growing rapidly and has been the beneficiary of the advances in technology, artificial intelligence, and the convergence of computational science and biology. Virtually all biological targets can now be translated into novel small-molecule medicines using the tools that are available to our industry (eg, computational chemistry, structural biology, DEL screens, generative AI, molecular glues, degraders, CRISPR screens, organoids, etc). Our success will depend, in part, on increasing venture capital investment in early-stage companies focused on translating discoveries in complex human biology to new medicines.”
Precision Medicine
For Ron Mazumder, partner at Illumina Ventures, which specializes in investing in genomics and precision health companies: “The biopharma landscape in 2025 is poised for growth, driven by the convergence of high-throughput genomics technologies, hyperscale biology and AI - what we call Genomics 3.0.”
Linda De Jesus, vice president/general manager of global commercial operations at genomics research product maker Integrated DNA Technologies (IDT), was of a similar view. “The genomic revolution is transforming the biopharma industry, and researchers and scientists tackling complex diseases are turning to tools like CRISPR and RNA therapeutics to do much of this work,” she said. “These technologies are being relied on to unlock targeted therapies for rare diseases and cancer, and in the process are reshaping the future of medicine.”
According to De Jesus, “the biopharma industry is poised for significant advancements thanks to advancements in genomic therapeutics. Leading the way is precision medicine, particularly as it is applied to oncology and rare diseases, as genetic testing becomes routine in healthcare. This shift will lead to a surge in novel targeted therapies entering clinical trials. Pair it with falling costs and increasing accessibility, then throw in help from AI and machine learning, and the future looks bright indeed, with everything from optimized drug screening methods to streamlined clinical trials in play. As we explore new possibilities to improve health, the focus remains on accelerating research, enhancing precision, and developing novel therapies.”
“Heading into 2025, biopharma will continue to break ground in patient care through the expansion of precision medicine,” said Ben Hickey, president of RayzeBio and head of Mirati, both Bristol Myers Squibb companies.
Heading into 2025, biopharma will continue to break ground in patient care through the expansion of precision medicine.
Ben Hickey, RayzeBio, Mirati, Bristol Myers Squibb
“Advances in the field continue to revolutionize treatment approaches, moving the industry further away from one-size-fits-all to more personalized, effective therapies based on an array of biological and individual disease and lifestyle factors,” said Hickey. “Radiopharmaceutical therapies (RPTs) represent a prime example of this innovation, positioned to be a core modality in the next wave of cancer treatments. By delivering radioisotopes directly to cancer cells, RPTs can treat systemic disease precisely while limiting off-target effects, have the advantage of being both diagnostic and therapeutic, and combinable with other modalities. The opportunity for more personalized and effective treatments has never been greater and it is essential that our industry continues to invest in the science, technology, and expertise needed to bring these transformative solutions to patients around the globe.”
Werner Lanthaler, founder and CEO of Wlan Holding and former CEO of Evotec, warned against disillusionment as precision medicine remains broadly elusive. “Still today, 85% of all chemotherapies have little to no effect, and about 50% of treatments cause more side effects than benefits. Attrition rates have barely improved in the last decade. With costs exceeding $2.5bn per approved product and 80% of treatment costs wasted, the claim of ‘precision medicine’ still feels like a distant dream. Has the belief in next-gen technologies been overstated, or has AI simply added confusion? No! We have come a long way, and the technology boom of the last three decades will finally lead us into the age of understanding towards better targeting, diagnostics and treatment,” he said. “Omics technologies enable us to determine exactly where along the progression of a disease we can intervene. Deep molecular understanding allows us to target the right patient population with the right drug at the right dose. The technologies are all in place marking the beginning of the best days of medicine.”
Cell And Gene Therapy
“After a turbulent few years, as we head into 2025, cell and gene therapy will regain its place as the golden child of biotech,” predicted James Sheppard, international head of asset management at Kadans Science Partner, which operates laboratory and office buildings for innovative sectors.
Cell and gene therapy will regain its place as the golden child of biotech.
James Sheppard, Kadans Science Partner
“A number of key clinical trial readouts expected in 2025 will spur the market into recognizing the value of the assets in development, which are now well positioned for valuation and commercialization following record numbers of FDA approvals in 2024. Maturation of R&D and manufacturing facilities across Europe mean for the first time we are truly prepared as an industry to support the needs of this exciting asset class,” Shepherd said.
Frank Mathias, CEO of OXB (the rebranded Oxford Biomedica), agreed that: “The cell and gene therapy sector continues to demonstrate strong momentum as we approach 2025. Its increasing maturity is evidenced by the growing number of late-stage programs across multiple modalities. The pace of regulatory approvals is particularly encouraging, with several cell and gene therapies approved by regulators in 2024 to date and additional approvals anticipated in the coming months.”
Mathias added: “CDMOs [contract development and manufacturing organizations] must evolve to meet increasingly complex demands, from multi-vector capabilities to scalable, cost-effective production solutions. Looking ahead, expanding patient access to these transformative treatments remains a key industry priority. This will require continued innovation in manufacturing processes and technology, alongside collaboration between therapy developers, manufacturers and technology providers to establish robust standards for efficiency, quality, and scalability that will define the future of cell and gene therapy.”
Maher Masoud, president and CEO of cell engineering firm MaxCyte, highlighted gene editing as an area to watch. “As we enter 2025, biopharma is set to build on the momentum of 2024, which saw the FDA approve the first CRISPR-based therapies, ushering in a new era of gene editing,” he said. “These landmark approvals have spurred advancements in technologies like base editing and prime editing, expanding the possibilities for treating diseases far beyond cancer. These therapies are no longer theoretical; they’re advancing through development pipelines and proving their ability to reach the market.
“Innovations in delivery platforms, such as non-viral electroporation, are playing an important role in this transformation. These technologies enable safer, scalable, and cost-effective delivery of complex gene-editing tools, crucial for the growing diversity of gene therapies. Cell engineering companies are helping to drive this progress by offering robust solutions for these next-generation therapies. As we look to the year ahead, 2025 promises to be pivotal in cementing gene therapy’s role in addressing some of medicine’s toughest challenges.”
Biomarkers/Diagnostics
“In terms of diagnostics, I think 2025 will be a banner year as the industry continues moving into a new stage of maturity – what some are referring to as Diagnostics 2.0,” said Marc Stapley, CEO of cancer diagnostics company Veracyte.
“The days of molecular diagnostics companies pursuing ‘holy grail’ opportunities, spending money freely and driving test volume without reimbursement are gone,” said Stapley. “As an industry, we’ll continue to be more focused on clinically useful tests that are backed with rigorous evidence, as well as on financial discipline and responsibility. We’ll see, for example, more companies running prospective clinical utility studies to gain clinician trust and payer coverage for their tests. At the same time, we’ll continue to see more companies in the space report on profitability indicators such as EBITDA, in addition to growth.”
As an industry, we’ll continue to be more focused on clinically useful tests that are backed with rigorous evidence, as well as on financial discipline and responsibility.
Marc Stapley, Veracyte
For Billy Boyle, CEO of UK breath biopsy developer Owlstone Medical, breath analysis for early disease detection and monitoring should advance. “Breath analysis offers a non-invasive, rapid, and versatile tool for early disease diagnosis and treatment monitoring, improving patient outcomes,” he said. “Volatile organic compounds (VOCs) arise from endogenous or exogenous sources and are detectable on breath, offering critical insights into physiological processes and disease progression. Despite the promise of this modality, there is currently a lack of validated breath biomarkers in the clinic. Reference databases of VOCs in breath serve as a baseline to streamline biomarker discovery and validation, mapping VOCs alongside their clinical, chemical, and biological context, enabling development of diagnostic tests for conditions such as cancers, kidney disease, and liver cirrhosis.” He predicted that: “In 2025, this data will support scientists in the breath research community to advance breath-based diagnostics and address the challenges of standardization and replicability in the field, meaning that breath analysis could become as routine as blood tests, marking a new era in non-invasive biomarker technology.”
Supply Chain
Executives drew attention to various aspects of the biopharma supply chain.
“With incidences of extreme weather increasing, 2025 will see growing demand for resilient, agile and domestic supply chains that are able to withstand shocks and disruptions. As a result, we will see biomanufacturing continue to gain a foothold in the US and begin to prove its value, both in onshoring pharma production and driving commercial success. In kind, we will see a ripple effect in which other sectors begin to apply biomanufacturing innovation to address other serious global challenges,” said Christina Smolke, CEO of Antheia, which uses synthetic biology for pharmaceutical manufacturing. “With more than 80% of pharmaceutical ingredients being sourced from only two countries, there is an immense opportunity to transform and localize these critical supply chains,” she said. “As the US continues to prioritize public health preparedness as a bipartisan matter of national security, next year will see growth in both the number of and scale of public-private partnerships. Onshoring pharmaceutical supply chains and revitalizing US manufacturing will require deep collaboration across industry and government for everything from infrastructure, regulatory, to workforce development.”
We will see biomanufacturing continue to gain a foothold in the US and begin to prove its value, both in onshoring pharma production and driving commercial success
Christina Smolke, Antheia
Kirk Kaminsky, president, US Pharmaceutical, at McKesson, underscored the importance of adapting manufacturing for advanced therapies. “While the healthcare system is challenged, unprecedented scientific discoveries offer great promise and hope for patients. If you look at the pharmaceutical pipeline, many drugs in development will require specialized conditions like temperature control and light protection, necessitating robust infrastructure and careful management,” he said.
“In addition, new care delivery and identification mechanisms will be critical to patient-specific therapies. As a leading healthcare services company, we are continuing to strengthen our readiness for this innovation by expanding our cold chain storage, infrastructure, and quality controls. In addition, across our industry we must realize the power of digital enablement, including artificial intelligence, to modernize our supply chain and enhance efficiency, visibility and infrastructure. As we chart the path forward, collaboration across the public and private sectors is essential to strengthening supply chain resilience so that together we can deliver for the patients who are counting on us,” Kaminsky said.
“The biopharma industry is entering a new era, driven by the revolutionary promise of cell and gene therapies to cure debilitating diseases. To realize this potential, a decentralized hub-and-spoke model, supported by cutting-edge IT solutions for comparability and centralized oversight, is unlocking scalable and efficient point-of-care (POC) manufacturing,” said Vered Caplan, CEO of cell and gene therapy developer Orgenesis. “This model transforms the economics and logistics of advanced therapies. By integrating highly automated, standardized processes – such as advanced analytics, prefabricated GMP units, and streamlined production infrastructure – it eliminates the inefficiencies of hospital-based development. This ensures regulatory compliance, reduces reliance on scarce skilled labor, and significantly lowers the cost of manufacturing.
“With regulatory agencies embracing this innovative approach, biopharma companies can accelerate clinical development, expand access, and create a pathway for life-saving therapies to reach more patients. By adopting this forward-thinking model, the industry is poised to deliver unprecedented impact, transforming healthcare at scale,” concluded Caplan.
“The biopharma industry is transforming in 2025, driven by decentralized manufacturing, Pharma 4.0 technologies, and sustainability-focused innovations,” said Carol Houts, chief strategy officer of cleanroom facility manufacturer GermFree. “Decentralized models, supported by mobile and modular cleanrooms, address drug shortages with localized, agile production. Meanwhile, Pharma 4.0 integrates smart technologies to enhance process control, ensure compliance, and improve efficiency. Sustainability now extends beyond environmental goals to include economic and operational impacts. In cell and gene therapy, cost management strategies – such as reducing waste and optimizing workflows – maintain affordability and access for patients. Long-term planning and flexibility help prevent inefficiencies and create lasting value.”
For Houts, “by embracing digitization, sustainability, and decentralization, the industry is building a resilient future, ensuring therapies remain accessible while meeting evolving challenges with precision.”
Specific challenges were highlighted by others.
“The biopharma industry, especially the generics sector, continues to face significant challenges. Concerns stemming from persistent drug shortages are exacerbated by misperceptions about medicine quality, often fueled by misinformation. In response, some buyers are turning to unreliable third-party labs using questionable methods to test quality,” warned Ronald Piervincenzi, CEO of nonprofit organization U.S. Pharmacopeia. “The US FDA has warned against unvalidated third-party quality testing. To bolster confidence in generic medicines, market-based pharmaceutical testing should only rely on reputable labs that use validated methods from the beginning,” he said.
Chonnettia Jones, president and executive director of nonprofit plasmid-sharing repository Addgene, called on support for access to key materials. “In recent years, the industry has made great strides to drive innovation and power the advancement of novel approaches to drug development. To foster continued progress, it’s critical that we establish broader access to curated, authenticated research materials such as plasmids, viral vectors, and antibodies,” she said. “As we progress into 2025, I anticipate an ongoing commitment to scientific sharing as a means of advancing new discovery, and a growing demand for high-quality, accessible and reproducible materials, reducing the financial, technical, and administrative hurdles that academia and industry often face when sourcing research materials.”
It’s critical that we establish broader access to curated, authenticated research materials such as plasmids, viral vectors, and antibodies.
Chonnettia Jones, Addgene
Labs And Services
“The market downturn brutalized biotech. Equity funding is scarce. But there’s a silver lining: demand for every other factor in the production of new drug research has plummeted,” said Brian Finrow, CEO of Lumen Bioscience, which develops orally delivered biologics using a platform based on spirulina algae. “The market for lab space is a good example. Three years ago, it was unavailable at any price; today Seattle’s lab occupancy rate is just 60% (ie, 40% empty). We are seeing the same at the big CDMOs, CROs, and lab equipment vendors – a steady drumbeat of earnings misses and layoffs. This is painful for the employees, but such ‘creative destruction’ is good news for biotech: when demand drops, prices drop – that’s basic economics,” he said.
“It’s also good for entrepreneurs, patients, and society at large. It’s widely appreciated that the steady decline in biopharma R&D productivity is out of hand, an effect known as Eroom’s Law. We the downturn’s survivors have a chance to use the market downturn to reverse that dismal trend…”
More upbeat on the demand for services was the CEO of Rentschler Biopharma. “As CEO of a CDMO specializing in complex biopharmaceuticals, I foresee robust growth driven by a pipeline of next-generation therapeutics from innovative companies seeking production support,” said Benedikt von Braunmühl. “Additionally, personalized medicine is still on the rise, fueled by more precise diagnostic tools and technologies. Artificial intelligence (AI) will play a pivotal role in streamlining research and development processes.
“The demand for integrated services is surging, with the market projected to reach $194.7bn by 2026. Biopharma companies will increasingly seek CDMOs that are not only flexible and agile but also capable of forming strategic, long-term partnerships,” von Braunmühl predicted.
I foresee robust growth driven by a pipeline of next-generation therapeutics from innovative companies seeking production support.
Benedikt von Braunmühl, Rentschler Biopharma
Patients In Focus
“Increased focus from patient advocacy on drug development and new innovations in technology are empowering patients and caregivers, giving them a real stake in their healthcare. Commercialization models that engage payers, providers, advocacy, and regulators early in the development process can support more informed, data-driven therapies enabling manufacturers to focus resources on the most effective treatments for patients with high-unmet needs,” said Catherine Owen Adams, CEO of neuroscience-focused Acadia Pharmaceuticals. “In 2025, the continued adoption of technologies like AI and machine learning will further accelerate the R&D process and enable a more tailored, thoughtful approach to clinical programs. This collaborative model is especially important in neuroscience and rare disease – areas often under/mis-diagnosed, and requiring research informed by a comprehensive view of the entire patient experience.”
It is evident that now more than ever we are rapidly making significant advancements in developing innovative treatment modalities that will help patients live their lives the way they are meant to be lived.
Jonathan Rigby, Sernova
“Not only am I a biotech industry executive, but I’m also one of the very people that our industry is trying to help,” said Jonathan Rigby, chairman and CEO of Sernova. “I have lived with Type 1 diabetes since the age of 18 when I was diagnosed after a near-death experience with ketoacidosis. Since then, I have navigated life with T1D and a long career in biopharma. With that perspective, it is evident that now more than ever we are rapidly making significant advancements in developing innovative treatment modalities that will help patients live their lives the way they are meant to be lived. Heading into 2025 as the CEO of a company with potentially transformative technology for people living with T1D and other chronic diseases, I am confident that patients will continue to be at the forefront of our work as we collectively aim to improve the lives of people around the world.”
Planning And Execution
“A major focus for biotech companies going into 2025 will be planning and execution,” declared Jennifer Schneider, CEO of infectious disease immunotherapy developer Centauri Therapeutics. “While fundraising is always on the agenda for any biotech, those organizations which can efficiently deliver their plans and communicate results in a reliable way will stand out from the crowd. Science is unpredictable; however, every company is in control of their execution. As the funding environment remains constrained, staying focused on planning and efficient delivery of data enables rapid decision making, conservation of cash, and allows organizations to be responsive to results and market activities.”
David Kirn, CEO of gene therapy developer 4DMT, flagged up “an increased need for sustainable growth amidst an evolving landscape.” For Kirn, “success and steady growth will require cultivating top-tier talent and aligning teams around shared goals, even as we navigate uncertainty. Additionally, and equally as important, is investing in the next generation of life science leaders, empowering them with the skills and vision to carry the industry forward. By prioritizing robust leadership – from advisors to management – companies will build stronger teams and contribute to an ecosystem capable of overcoming today’s challenges and shaping the future of medicine. Operating lean and scaling deliberately will be essential to weather further uncertainty and economic pressures, and successfully bring new medicines forward for patients in need.”
Similarly, Novavax’s Silvia Taylor said: “Watch how companies become more mindful stewards of capital by remaining cautious about how, when and where they spend and invest their money.”
Operating lean and scaling deliberately will be essential to weather further uncertainty and economic pressures.
David Kirn, 4DMT
Mike Martin, principal and leader of clinical development practice, ZS, also highlighted the need for more efficient, effective ways of working. “I see continued excitement in 2025 around AI and automation in drug development. Focus will remain on underlying data, technology and advanced AI methods. Adoption and organizational structure will also be a major focus as successful POCs [proofs of concept] now move to scale across sponsor organizations. This will require a review of ways of working, collaboration models, governance and incentives,” he said. “Coming off the significant reductions across pharma organizations in 2023 and 2024, this will be a fresh start to get the most out of the latest advances. In terms of specific impact points, document automation will continue to be a major activity. Sponsors we are working with are also increasing efforts around digital twins and the potential of in silico study design. Economic pressures on drug development will only get tighter. R&D oversight and enabling drug development leaders to understand their investments and impacts of tradeoffs will continue to increase in importance.”
“Today, we have more technologies than ever before – from genetic medicines to AI to digital health. And while buzzy, we need to focus on how these tools can help answer key questions versus trying to integrate them for trends’ sake,” cautioned Regeneron Pharmaceuticals' Justin Holko, senior vice president and head, global oncology/hematology commercial business unit. “And we still need humans behind these technologies to be discerning throughout to capitalize on their game-changing potential.”
Holko went on: “Take for instance, AI. Our commercial sales team is one of our highest priorities – the question always is, how can we continue to help them work smarter and maximize ever-limiting resources? That’s where AI can help with targeting, creating efficiencies, analyzing for opportunities. So while I don’t see AI leading conversations with health care professionals, I do see its value provided as part of the solution we’re addressing and humans are still at the wheel.”
