Key therapeutic areas in 2025
GLP-1s
PurpleLab data cited by Axios shows a roughly 10 percent increase in sales for GLP-1s in 2024, with continued growth predicted for 2025 due to sustained demand, according to Evaluate’s 2025 Pharma Preview.
GLP-1s are a type of medication that can help manage Type 2 diabetes and obesity. After exceeding US$1 billion in 2024, sales projections for 2025 are strong for industry leaders Novo Nordisk (NYSE:NVO) and Eli Lilly and Company (NYSE:LLY), with Novo aiming to capture more than a third of the global market share of diabetes care in 2025.
To keep up with demand, both companies are addressing previous production constraints by expanding their manufacturing capacity. Novo acquired contract manufacturer Catalent in a US$16.5 billion deal, finalizing the sale in December 2024 and securing itself a position as a key player in the supply chain.
Meanwhile, Eli Lilly is bolstering its internal manufacturing with a new US$4.5 billion manufacturing and R&D center in Indiana, slated to open in late 2027. Eli Lilly is also expanding its existing facility in Wisconsin, and has reportedly partnered with CDMOs National Resilience and BSP Pharmaceuticals to meet immediate needs.
Both companies are also making strategic moves to maintain their market dominance amid the entry of biosimilars from corporations like Teva Pharmaceutical Inudstries (NYSE:TEVA) and pharma companies in China.
Eli Lilly’s partnership with digital health company Ro expands patient access to its medications via telehealth, while its lower-priced, single-dose vials of Zepbound lower cost barriers for the self-pay market. The company is also actively testing tirzepatide for indications against MASH and chronic kidney disease, and its oral GLP-1 agonist orforglipron is in Phase III trials for obstructive sleep apnea in addition to obesity and type II diabetes.
For its part, Novo Nordisk is exploring new indications for semaglutide, including MASH, and as a potential treatment for Alzheimer’s disease.
Oncology
According to Evaluate analysts, the field of oncology continues to be another evolving area within the pharmaceutical industry. While traditional cancer treatments remain relevant, there has been a notable shift in R&D focus towards more targeted approaches. Antibody-drug conjugates (ADCs) have emerged as a promising avenue in oncology research in recent years, and have shown potential in improving treatment outcomes for various types of cancer.
Clinical trials examining the efficacy of Merck’s (NYSE:MRK) Keytruda, an immune checkpoint inhibitor, with various ADCs showed promising results compared to standard chemo treatments. An ongoing trial, DESTINY-Breast09, is investigating the combination of AstraZeneca (NASDAQ:AZN) and Daiichi Sankyo’s (OTC Pink:DSKYF) Enhertu and Keytruda in HER2-positive breast cancer, with primary completion data likely due in Q3 2025.
These trials could unlock new treatment options and expand the market for these already successful ADCs.
Similarly, bispecific antibodies have garnered significant attention in the oncology space, demonstrating efficacy in hematologic malignancies. A trial directly comparing Keytruda to Ivonescimab, a bispecific antibody under development by Chinese pharma company Akeso Biopharma (OTC Pink:AKESF) and licensed by Summit Therapeutics (NASDAQ:SMMT), shows that ivonescimab had a better overall survival rate than Keytruda.
Further testing is required, but the suggested outcome could impact the future development and potential commercial success of ivonescimab and the bispecific antibody mechanism overall.
Another area of renewed interest in recent months is bispecific antibodies targeting the TIGIT immune checkpoint.
While Roche (OTCQX:RHHBF) and its subsidiary Genentech’s tiragolumab faced a setback in a Phase III trial, Gilead Sciences (NASDAQ:GILD) and Arcus Biosciences (NYSE:RCUS) have seen promising results with their anti-TIGIT drug domvanalimab. In a Phase I trial, domvanalimab plus anti-PD-1 antibody zimberelimab led to a 36 percent reduction in risk of death for patients with advanced non-small cell lung cancer compared to patients who took zimberelimab alone.
“These are the first results demonstrating an improvement in overall survival reported for domvanalimab and zimberelimab,” said Dimitry Nuyten, chief medical officer for Arcus, when he shared the results at the Society for Immunotherapy of Cancer's annual meeting in November 2024.
“They add to the growing body of evidence that domvanalimab … may have a differentiated efficacy, safety and tolerability profile relative to published data from studies with Fc-enabled anti-TIGIT antibodies," he added.
Immunology
While immunology remains a key area of pharmaceutical investment following the success of interleukin inhibitors Dupixent, which was jointly developed and commercialized by Sanofi (NASDAQ:SNY) and Regeneron (NASDAQ:REGN), and Skyrizi, developed and marketed by AbbVie (NYSE:ABBV), the sector is also experiencing shifts.
On January 13, amid declining demand for COVID-19 and respiratory syncytial virus vaccines, Moderna (NASDAQ:MRNA), one of the most prominent names in immunology, cut its sales forecast for 2025.
The company told investors that it expects 2025 revenue of between US$1.5 billion and US$2.5 billion, down from its previous projection of between US$2.5 billion and US$3.5 billion.
Pharma regulation to shape investment decisions in 2025
Changes in the pharma industry’s heavily regulated environment could impact how companies make investment decisions in 2025. While Big Pharma may be hopeful that President-elect Donald Trump will ease drug price negotiation rules, he has been relatively quiet about repealing that aspect of the Inflation Reduction Act (IRA). His stance on the Affordable Care Act is unclear, but he has been vocal about his intentions to trim federal funding for various programs.
The Affordable Care Act currently provides health insurance coverage to over 45 million Americans. Changes to coverage could have ripple effects throughout the healthcare sector in the US, including the pharmaceutical industry, as reduced coverage could lead to decreased demand for certain medications.
If IRA provisions remain in place or are strengthened, they could put downward pressure on drug prices, potentially impacting company revenues and investor returns. Conversely, if these provisions are weakened or repealed, it could provide a boost to the industry. Investors will need to closely observe political developments in 2025.
Trump's unconventional nominees for key health and regulatory positions add another layer of complexity.
- When he named celebrity Dr. Mehmet Oz as his choice for administrator of the Centers for Medicare and Medicaid Services, Trump said Dr. Oz would “cut waste and fraud within our country’s most expensive government agency,” prompting analysts to speculate that he may alter rules on who qualifies for Medicaid and Medicare by instituting work requirements to receive these services.
- Robert F. Kennedy Jr. as secretary of health and human services could impact pharma companies developing vaccines — while he has expressed skepticism about vaccines, he has also clarified that he supports rigorous research into vaccine safety rather than eliminating them entirely.
- The nomination of Dr. Marty Makary as US Food and Drug Administration commissioner has been met with optimism from some analysts who anticipate a potentially more streamlined drug approval process. This could be a positive sign for investors, as faster approvals mean quicker market entry for new drugs.
