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Navigating the 2024 Life Science Landscape: Trends, Challenges, and Opportunities

As we step into 2024, the global life science industry finds itself at a crossroads, facing plenty of challenges alongside an abundance of exciting opportunities.

The pharmaceutical and contract outsourcing space has shifted, with new trends emerging that will shape the future of this rapidly changing industry. The global stage has witnessed significant upheavals throughout 2023, with wars impacting everything from oil prices to work locations. Inflation and rising material costs cutting into the profits of many life science companies, and a continuation of the COVID comedown, has left vaccine producers facing challenges and emphasising the need for the diversification of capabilities.

Here, Emma Banks, our CEO, predicts the trends that will dominate the sector in 2024.

Biotech Investment Slowdown: A Cautionary Post-COVID Tale

The roaring success of biotech investments during the pandemic has hit a speed bump. As other sectors gain traction post-COVID, biotech faces a slowdown due to rapidly increasing interest rates and the diversification of investments. This shift poses risks and a reduction in the flow of money with less capital available for biotech companies.

Faced with this challenge, biotech firms are now reevaluating and being more cautious with their investment strategies, focusing on specific assets within their pipelines.

“…the biggest trend we’ve seen is the number of customers that are not necessarily well-funded. So many of them have far less cash than they’ve had in the past. As a result of that, they’re much more cautious as to how they’re spending their capital. They are very selective on their number of assets. We’ve seen a lot of deprioritisation of assets. They’re looking for more creative funding, where they give us stock. We can only take so many bets, and I think that’s the challenge.”

Outsourced vendor

Increasing Focus on Supply Chains

The vulnerabilities exposed by COVID have led to a renewed emphasis on securing and optimising supply chains.

Onshoring is gaining prominence due to geopolitical tensions, with more business flowing from East to West. That said, there are a growing number of Asian CDMOs coming to the fore of the industry, particularly in markets such as Japan and South Korea.

The concept of “domesticating” gains momentum, as countries like Canada invest heavily to be better prepared for future pandemics.

“Canada has a nice R&D rebate program, which factored into our decision to go with our vendor. If it’s qualified as research, you can get a good percentage of that back from the Canadian government.”


Continued Explosion of Advanced Novel Modalities

Cell and gene therapies, CAR-Ts, and oligonucleotides continue to grow within the clinical pipelines, promising groundbreaking treatments. Despite regulatory challenges and complexities in commercialisation, the focus on these novel modalities remains strong. Companies specialising in platforms supporting these new products play a critical role in the success of these therapies.

Real Focus on Partnerships

The life science outsourcing market remains highly fragmented; with over 400 players in the biopharma CDMO space alone, businesses and investors face almost limitless options.

This trend is coupled with a shift towards innovative partnerships; biotech companies are now seeking risk-sharing models and flexible collaborations with CROs and CDMOs. It’s time for companies to explore models beyond traditional fee-for-service arrangements, ensuring maximum value and conservation of cash.