The global pharmaceutical industry is in the middle of its biggest reset in a generation.
Our Global Pharmaceutical Investment Trends 2024 – 2025 research shows an industry:
- Doubling down on fewer, higher-conviction therapeutic areas
- Pushing metabolic disease and GLP-1 drugs toward what could be pharma’s first trillion-dollar franchise
- Shifting innovation gravity toward Asia-Pacific
- Scaling AI, CRISPR and mRNA from pilots to platforms
- Recalibrating traditional modalities like cell therapy and mRNA vaccines for infectious disease
Below is a high-level summary of the findings, with a spotlight on three frontier sectors: AI-powered drug discovery platforms, CRISPR companies, and mRNA vaccines for infectious diseases.
1. A sector at a strategic turning point
Patent cliffs approaching $300 billion through 2030, rising R&D costs and shifting policy landscapes are forcing pharma to make sharper strategic choices.
Key takeaways
- Portfolio concentration is accelerating
- Companies are moving away from broad therapeutic portfolios toward 2–3 core areas of deep expertise.
- Firms generating 70%+ of revenues from their top two therapeutic areas have delivered 65% higher total shareholder returns over the past decade.
- High-profile exits (e.g. AstraZeneca’s withdrawal from neuroscience, Takeda’s exit from cell therapy) signal willingness to cut entire areas to double down elsewhere.
- Metabolic disease is the defining growth story
- GLP-1 and obesity drugs are on track to become “the first trillion-dollar franchise in pharma history” over time.
- The obesity market is projected to reach $105–144 billion by 2030, up from just $6 billion in 2023.
- Licensing deals in obesity, diabetes and metabolic disease hit $18.2 billion in headline value in H1 2025 alone – more than all of 2024 combined.
- AI has crossed from experiment to necessity
- 95% of pharmaceutical companies now invest in AI.
- AI spend is expected to grow from $4 billion in 2025 to $25 billion by 2030.
- Yet only 10.7% of companies have fully implemented AI across clinical activities – leaving significant first-mover upside.
- Traditional modalities face business-model pressure
- Internal cell therapy programs and some gene therapy and mRNA vaccine efforts are being scaled back.
- The bottlenecks: manufacturing complexity, cost of goods, reimbursement uncertainty and capital intensity.
2. Where investment is flowing: Therapeutic areas
High-growth areas
- Oncology
- Still the largest therapeutic market, reaching $250 billion in 2024.
- Accounts for roughly one-third of biotech venture capital funding.
- Ten of the world’s largest pharma companies list oncology as a strategic focus, though pipelines are increasingly crowded.
- Metabolic disease & GLP-1
- GLP-1-focused deals: $8 billion in 2024.
- Obesity & diabetes deals: $6.4 billion in 2024.
- Eli Lilly and Novo Nordisk have committed $50+ billion in manufacturing capacity through 2028 to meet explosive demand.
- Morgan Stanley raised its 2030 obesity forecast from $77 billion to $105 billion, with upside to $144 billion.
- Neurology & neurodegeneration
- Renewed interest following FDA approval of donanemab (Kisunla) in 2024 for early Alzheimer’s.
- 2025 deals include Lundbeck–Longboard and AbbVie–Aliada, totaling $4 billion.
- Novel mechanisms (e.g. tau-targeting therapies) are attracting fresh capital.
- At the same time, AstraZeneca has fully exited neuroscience, underlining how polarized strategic positions can be.
- Immunology
- A core growth area alongside oncology, benefiting from targeted therapies and precision medicine.
- Increased venture formation of asset-centric immunology biotechs.
- Gene and cell therapies
- Gene therapy funding grew 200% year-over-year to nearly $1.5 billion in 2023.
- Respiratory disease funding increased 175% YoY to just under $1.3 billion.
- Selective pruning is underway:
- External partnerships and late-stage platform acquisitions (e.g. BMS / Orbital Therapeutics at $1.5 billion) are increasingly favored.
Areas under relative pressure
- Cardiovascular
- Still a huge clinical need but lagging in deal value: $27.1 billion in cardiovascular M&A (22 deals) from 2023–H1 2024 vs $96.1 billion in oncology (100 deals) and $38.3 billion in neurology (56 deals).
- The emphasis is shifting toward cardiometabolic models that link cardiovascular outcomes with obesity and diabetes management.
- Internal cell therapy build-outs
- Many large pharma players are moving from fully in-house cell therapy to partnered and platform-based approaches.
- Structural issues: complex manufacturing, limited scalability, high CoGs, and uncertain reimbursement.
- mRNA vaccines for infectious disease
- Venture financing for mRNA vaccines dropped 82%, from $510 million in 2023 to $90 million in 2025 YTD, after U.S. grant cuts.
- Funding for mRNA-based drugs more broadly fell from $1.1 billion (2023) to $488 million (2024).
- However, mRNA therapeutics (especially in oncology) remain a major growth engine (see sector deep dive below).
3. Geography: Innovation and capital rebalancing
Asia-Pacific: from factory to innovation engine
- China
- Accounts for 75%+ of Asia-Pacific VC/PE funding in biotech since 2019.
- High-value China–West licensing deals (>$50M) have increased nearly sixfold since 2020.
- Chinese biotechs generated 639 first-in-class drug candidates between 2022–early 2025, a 360% increase vs 2018–2021.
- Annual investment dropped from $5.8 billion (2021) to $1.9 billion (2023), but deal count and first-round financings remain robust.
- Geopolitical risk is pushing capital to Singapore, South Korea and India as diversification hubs.
- India
- Supplies >60% of global vaccines and leads in generics.
- Nearly $4 billion of investment under the PLI scheme by April 2024, with ~$3 billion earmarked for pharma and medtech.
- Indian pharma pipelines now include 40+ NCE/NBE programs.
- Still relies on China for 65–70% of APIs, underscoring supply-chain vulnerability.
- Singapore & South Korea
- Emerging as high-quality innovation hubs with strong venture-building and big-pharma incubator presence.
- J&J JLABS has incubated 25 companies in Singapore and 107 across Asia-Pacific.
Middle East & Africa: building capacity and self-reliance
- Middle East
- Market valued at $57.05 billion in 2025, projected to reach $78.30 billion by 2033 (CAGR 4.04%).
- UAE’s new regulations support accelerated approval for innovative drugs and biosimilars.
- GCC countries are investing heavily in local manufacturing and advanced healthcare infrastructure.
- Africa
- Investment is still modest but growing, with a strong focus on vaccine production and health sovereignty post-COVID.
- South Africa is emerging as a regional anchor for clinical trials and manufacturing.
North America & Europe: mature markets under pressure
- United States
- Biotech’s share of U.S. startup funding fell to just 8% in 2025, the lowest in over 20 years (from ~20% in 2020).
- IPO activity is muted: only 18 U.S. biotech/medtech IPOs on NASDAQ/NYSE in 2025 YTD.
- Headwinds include:
- Cuts to public research funding and grant constraints (e.g. proposed NIH budget cuts)
- Leadership churn at the FDA and public health agencies
- Ongoing uncertainty around drug pricing policy
- Counterbalancing this, big pharma is pouring money into domestic manufacturing:
- Novartis: $23 billion over five years
- AstraZeneca: $50 billion
- Roche: $50 billion
- Europe
- Large, stable market but slower AI adoption vs the U.S.
- Facing rising competition from Asia-Pacific innovators and tightening capital markets.
4. Frontier sector #1: AI-powered drug discovery platforms
The AI-enabled drug discovery ecosystem has rapidly evolved from experimentation to a globally scaled innovation layer across pharma.
Market structure and funding
- 530+ companies worldwide focused on AI-powered drug discovery as of October 2025.
- These are lean, tech-centric teams:
- Median headcount: 16 employees
- Median age: 7 years, showing that the sector has moved beyond early prototypes.
- Collectively, the sector has raised over $420 billion in disclosed funding.
- 49% of companies have raised at least one external round.
- Median capital per company: $18.6 million across three rounds, highlighting both investor appetite and capital intensity.
- Geographic funding split:
- United States: $121.7 billion, 627 rounds, 249 companies
- Asia: $267 billion, 150 rounds, driven by China, South Korea and Japan
- Europe: $28.8 billion, 258 rounds, 168 companies
- Canada: $2.6 billion, 34 rounds
- Other regions (Australia, Africa, LatAm) are emerging but still relatively small.
- Funding has grown at a CAGR of 8.5% over the past five years, with a surge post-2018 and a peak around 2021–2022.
How this links to pharma AI adoption
Within pharma and biotech companies themselves:
- 95% are now investing in AI capabilities.
- 81% use AI in at least one development program.
- AI investment is expected to rise 600%, from $4 billion (2025) to $25 billion (2030).
- Use cases with the highest adoption today:
- Real-world data analytics (85%)
- Medical writing (85%) – and 94% plan to prioritize it next year.
- Generative AI in drug discovery is projected to reach $2.85 billion by 2034, from $318.55 million in 2025.
Impact potential
- McKinsey estimates $60–110 billion in annual value for pharma and med-tech from generative AI alone.
- Strategy&PwC analysis suggests fully industrializing AI use cases could double current pharma operating profits by 2030, adding $254 billion in operating profit globally.
- AI platforms can:
- Cut drug discovery costs by up to 40%
- Compress timelines from 5–6 years to 12–18 months
- Achieve 80–90% phase I success rates for AI-designed molecules.
Key AI-discovery players include:
- Insilico Medicine – first fully AI-discovered and AI-designed drug to enter phase 2.
- BenevolentAI, Recursion, Atomwise and others pioneering target discovery, molecule design and preclinical optimization.
5. Frontier sector #2: CRISPR companies
The CRISPR ecosystem has matured into a highly capitalized and globally distributed hub of gene-editing innovation.
Sector landscape
- 359 active CRISPR companies worldwide as of October 2025.
- Company profile:
- Median headcount: 31 employees
- Median age: 8 years
- 46% of companies employ fewer than 20 people, indicating many remain lean and research-centered.
Funding and growth
- Total disclosed funding: $84.5 billion.
- 53% of companies have raised at least one funding round.
- Median raised per company: ~$30 million across three rounds.
- Geography:
- United States: $73.5 billion, 575 rounds, 192 companies
- Europe: $5.3 billion, 123 rounds, 85 companies
- Asia: $4.7 billion, 85 rounds, 64 companies
- Canada & Latin America: ~$1 billion combined
- Funding ranges from seed and grants to Series C/D rounds and 40 IPOs, illustrating a pipeline from discovery to commercial scale.
- Funding growth has been exceptionally strong:
- CAGR of 33.5% over the past five years.
- Major acceleration around 2020–2021, aligning with regulatory breakthroughs (e.g. FDA approval of CRISPR-based sickle cell therapies).
Strategic significance
- The CRISPR market (broadly defined) reached $4.04 billion in 2024, projected to grow to $13.39 billion by 2034.
- Over 50 clinical trials using CRISPR are underway globally.
- Challenges ahead:
- High manufacturing and delivery costs
- Need for better delivery systems and off-target risk management
- Transition from “platform promise” to clinical milestone-driven value
Despite volatility, CRISPR is now a core pillar of next-generation therapeutics, particularly in rare diseases, oncology, and in vivo gene editing.
6. Frontier sector #3: mRNA vaccines for infectious diseases
The success of COVID-19 vaccines has catalyzed a durable mRNA vaccine ecosystem that is now broadening beyond pandemic response.
Sector overview
- 359 companies are active in mRNA vaccines for infectious diseases as of October 2025.
- Company profile:
- Median headcount: 31 employees
- Median age: 11 years, signalling a move from experimental technology to an established therapeutic category.
- 41% of companies employ fewer than 20 people, with many emerging from academia and big pharma spinouts.
Funding picture
- Total disclosed funding: $162.4 billion.
- 43% of companies have raised at least one funding round.
- Median raised per company: $39.4 million across three rounds.
- Geographic breakdown:
- United States: $102.2 billion, 373 rounds, 168 companies
- Europe: $38.4 billion, 197 rounds, 107 companies
- Australia: $19.1 billion, 18 rounds – a surprisingly strong contributor
- Asia: $2.6 billion
- Canada: $121 million
- Africa and Latin America remain at early development stages.
- Funding growth:
- CAGR of 28.8% over the past five years, one of the fastest within life sciences.
- Peak inflows in 2021–2022, now stabilizing at elevated, post-pandemic levels.
Strategic context
- The broader mRNA therapeutics market was $15.5 billion in 2024 and is projected to reach ~$221 billion by 2033.
- Key focus areas:
- Next-generation infectious disease vaccines (beyond COVID-19)
- Cancer immunotherapies (e.g. BioNTech’s BNT122)
- Rare genetic diseases, regenerative medicine and gene-editing adjacencies
- While U.S. policy headwinds have reduced venture financing for some mRNA vaccine startups, global capital and big pharma partnerships continue to support the sector.
The net result: the infectious diseases mRNA ecosystem is transitioning from emergency-driven deployment to a proactive, platform-based model of vaccine innovation.
7. What this means for pharma leaders and investors
From our 2024–2025 analysis, several strategic imperatives emerge:
- Pick your lanes, and go deep
- Concentrate on 2–3 therapeutic and technology verticals where you can build a durable advantage.
- Treat exits (like neuroscience or cell therapy withdrawals) not as failures, but as capital reallocation strategies.
- Treat metabolic disease as a system-level opportunity
- Think beyond weight loss drugs to cardiometabolic disease, kidney disease, sleep apnea, PCOS and potentially neurodegeneration.
- Expect sustained competition and M&A as late entrants attempt to buy their way into GLP-1 and cardiometabolic leadership.
- Integrate Asia-Pacific innovation systematically
- Partnerships and licensing with China, Singapore, South Korea and India should be core to global R&D strategy, not peripheral.
- Diversify geopolitical exposure by building multi-hub models across the region.
- Move AI from pilots to platforms
- With 95% of pharma already “investing in AI”, the differentiator is no longer if you use AI, but how deeply and consistently.
- Focus on:
- Enterprise-level data infrastructure
- Prioritized, high-ROI use cases (e.g. trial design, target discovery, medical writing)
- Clear build–buy–partner strategies, given that only 30% of companies now plan to stay fully “build-only”.
- Manage modality risk with a portfolio lens
- For CRISPR, mRNA and cell therapies, pair scientific conviction with realistic views on manufacturing, regulation and reimbursement.
- Expect continued strategic divestitures, late-stage asset buys and platform-based partnerships as companies right-size their bets.
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