The 2025 Simon-Kucher CDMO Growth Report paints a picture of a sector that’s optimistic but facing real operational and strategic friction. Demand is rising, pipelines are shifting toward more complex modalities, and capacity is tightening in ways that will reshape where CDMOs can win.
Across my work with CDMOs and their pharma partners, I’m seeing many of the same tensions show up in day-to-day operations. Below are several actionable insights from the report, paired with practical implications for CDMOs evaluating their position for 2025 and beyond.
You can download the full report here: https://www.simon-kucher.com/en/insights/cdmo-growth-outlook-2025
Table of Contents
Capacity Will Be the Real Battleground for Late-Phase and End-to-End Players
Late-phase and end-to-end CDMOs expect the tightest capacity constraints in 2025. For many, this may function as a strategic advantage: when slots tighten, pricing power increases and customer stickiness rises.
Implications for CDMOs:
- Treat capacity like a revenue strategy, not just an operational constraint.
- Evaluate where constrained capacity can justify pricing adjustments or capacity-reservation models.
- For small and mid-size CDMOs: earlier visibility into demand will matter more than ever. This may require better forecasting processes or tighter customer communication loops.
Pharma and CDMOs Are Misaligned on What “Good Partnership” Actually Means
One of the most important findings in the report is the persistent collaboration gap:
- Pharma puts supply chain reliability near the top of its priority list.
- CDMOs consistently rank speed much higher than pharma does.
- Emerging biopharma over-indexes on communication quality — something many CDMOs underrate.
- Pharma cares meaningfully more about geographic proximity than most CDMOs assume.
These misalignments show up every day in delayed tech transfers, mis-scoped proposals, and strained account relationships.
Implications for CDMOs:
- Recalibrate messaging and account management to emphasize reliability and transparency, not just timelines.
- Segment engagement strategies: emerging biotech wants hands-on communication; established pharma wants predictable supply and flawless execution.
- Use customer interviews (beyond RFP checkboxes) to understand what each account actually values.
This is an area where I spend a lot of time helping clients: creating processes that make customer expectations explicit and operationally actionable.
HP APIs and Oncology-Linked Modalities Are Growing but Many CDMOs Are Underprepared
Across both CDMOs and pharma, oncology-linked modalities — especially ADCs — are viewed as among the fastest-growing areas. At the same time, pharma places much higher importance on highly potent APIs (HP APIs) than CDMOs do.
This signals a capability gap.
For CDMO’s offering fill-finish services, the ability to handle HP APIs will mean investing in:
- Containment infrastructure
- High-potency handling expertise
- Specialized analytical capabilities
Implications for CDMOs:
- If HP APIs or ADC-adjacent capabilities aren’t on the 3–5 year capex roadmap, now is the time to reassess.
- Even small moves, such as early hazard evaluation capability or initial containment upgrades, can position a CDMO for higher-value work.
- Capacity constraints in biologics make niche high-potency plays increasingly attractive.
Pricing Models Are Shifting, but Not Uniformly
Pharma segments vary significantly in their pricing preferences:
- Emerging biopharma favors milestone-based and performance-based models.
- Established pharma wants flexibility, predictability, and options.
- Take-or-pay is liked by some late-phase CDMOs but disliked by pharma.
Pricing is no longer a back-office function. It’s a strategic differentiator.
Implications for CDMOs:
- Avoid a one-price-model-fits-all approach.
- Tailor pricing models to the customer segment and the modality.
- Use pricing structure to align incentives and lock in longer-term relationships.
- Build internal guidelines so commercial teams aren’t improvising.
The Digital Gap Between Pharma and CDMOs Is Widening
Pharma is leaning into AI, PAT, and predictive maintenance. CDMOs, especially late-phase and end-to-end, are more focused on continuous manufacturing and throughput.
But pharma’s expectations are shifting quickly, particularly around quality control, real-time analytics, and digital reliability.
Implications for CDMOs:
- Look for opportunities to move to “minimum viable digital maturity,” not full digital transformation.
- PAT, electronic batch records, and predictive maintenance are areas where pharma sees immediate value and where CDMOs often underinvest.
- AI adoption doesn’t need to be massive to be meaningful. Even simple process-optimization use cases can differentiate.
The Bigger Picture
The report paints a clear picture: strong demand alone won’t guarantee growth. CDMOs that win in 2025 will be the ones that:
- Secure and deploy capacity deliberately
- Align internal processes with what pharma values (not what CDMOs assume they value)
- Invest selectively in the high-value modalities shaping the next decade
- Modernize pricing and engagement models
- Build capability roadmaps that match emerging customer expectations
For CDMOs navigating these shifts, having an external perspective can help validate priorities, identify misalignment with customers, and sharpen strategy in areas where the market is moving faster than internal consensus.
If you’d like to unpack what this means for your specific modality mix, customer segments, or strategic roadmaps, I’m always happy to discuss.