Dear Reader,

Welcome to the 2024 edition of GBR’s United States Life Sciences industry report.

Cautious optimism. These two words best describe the state of mind of life sciences executives as we enter the second half of 2024. Having experienced one of its hardest-ever years in 2023 – in terms of depressed valuations, public and private fundraising drought, and challenging geopolitical fluctuations – the US life sciences industry is now embracing recovery mode.

The US remains the leading force in the life sciences industry worldwide, providing an unparalleled ecosystem of VC and institutional investors funding the most promising technologies that emerged out of the brightest minds. From the cloisters of the Ivy League in the East, passing by the shining towers of Wall Street, through the start-up labs of California, and with a flurry of growing hubs across the country, the US remains the premier life sciences hub in the world. Its position as the biggest pharmaceutical market globally attracted an unprecedented number of foreign players in 2023, with Indian CROs, European CDMOs, and South Korean mega-conglomerates establishing a presence there.

Yet, big pharma and biotechs face perhaps their biggest challenge to date: That of having to reinvent their business model. Despite a record year for FDA approval (with 55 novel drugs), the release in recent years of the anti-obesity GLP-1s, the first ever FDA-approved early-treatment Alzheimer’s drug, and unprecedented strides in oncology, Big Pharma returns lagged the S&P 500 in the period since the pandemic, and biotech did even worse. Reincorporating risk – despite the high chance of failure – and targeting assets in less crowded therapeutic areas will represent key strategic considerations for executives going forward.

Fortunately, US biopharma companies can rely on a diverse ecosystem of CDMOs, CROs, and specialty chemical firms to ensure their molecules make a difference for patients. This segment, however, will have to face challenges of its own in 2025. Be it small or large, manufacturing molecules is a matter of national security, and the recently proposed BIOSECURE Act could become a catalyst for reshaping the contract manufacturing scene in the US. As tensions between the US and China heat up, drugmakers and biotechs will keep accelerating their contingency plans.

Drawing from almost a hundred interviews with biopharma, biotech, investors, CDMOs, CROs, specialty chemical, technology, and AI executives, the following pages present a comprehensive overview of the US life sciences industry today, and offer insights into the country’s capability to attract foreign capital, talent, and science. The report concludes by pondering the debate on the relationship between viruses – of which a number have recently spread beyond their “tropical” places of origin – and humanity, and how proactive investment in this area can lead to both returns and the well-being of our species. We would like to thank the executives who took the time to share their invaluable insights with us, along with our association partners at BioNJ, MassBio, and Biocom California. We hope you enjoy the read.