What are the top three issues driving the CDMO market for small-molecule API development and manufacturing in 2025?
The CDMO market is increasingly shaped by the growing structural complexity of molecules, the acceleration of development timelines, and the challenges posed by global economic and geopolitical pressures. Molecules are becoming harder to synthesize due to complex structures, such as multiple chiral centers and challenging functional groups. Development timelines are tightening, particularly for oncology drugs, with many receiving expedited approvals. At the same time, geopolitical and fiscal challenges are adding to the complexity of managing supply chains and production.
How would you describe the current state of manufacturing capacity in the market? What key factors are influencing how the industry is utilizing available capacity?
At a commercial scale, the ability to maintain consistent, high-quality supply hinges on robust global networks and the flexibility to optimize capacity allocation across multiple sites. For clinical-scale manufacturing, the focus is on implementing phase-appropriate strategies that enable seamless scalability from development to commercialization. Industry-wide capacity utilization is influenced by a combination of factors, including increasing demand for dual sourcing, the need to accommodate launch quantities, and the growing emphasis on supply chain resilience. CDMOs must therefore adopt dynamic resource allocation models to meet these evolving demands effectively.
From a product and technology perspective, what key trends are you seeing in the small-molecule API space?
Key trends include the growing focus on sustainability, innovation in synthetic routes, and a push for precision manufacturing. Sustainability goals are leading to greener, more efficient processes that align with broader environmental objectives. At the same time, the rise of complex, high-value molecules, especially in oncology, is driving demand for advanced synthesis techniques that can meet tight timelines. These trends underscore the need for CDMOs to blend technological innovation with operational expertise to stay competitive.
Looking at the big picture, what external forces will shape the small-molecule drug market in the future?
Trade policies, regulatory changes, and geopolitical dynamics will play pivotal roles in shaping the market. Shifts in trade agreements or tariffs can disrupt global supply chains, making diversified manufacturing networks essential. Regulatory developments, particularly around accelerated drug approvals, are compressing timelines and necessitating more agile chemistry, manufacturing, and controls (CMC) processes. Additionally, economic pressures and geopolitical uncertainties require CDMOs to adopt proactive strategies to navigate risks while maintaining their commitment to quality and innovation.