This article series tied to the HealthcareGo conference held in Charlotte, North Carolina, on Sept. 16-17, 2025, spotlights key takeaways from across the sector including, AI, healthcare finance, compliance and diligence strategies, and investment considerations. This installment focuses on current investment considerations in life sciences, offering a look into what industry leaders are experiencing and watching closely. This panel featured investors, lenders and regulatory experts, exploring trends, risks and opportunities in life sciences investing. Themes across the panel included current regulatory uncertainty, sector transformation due to AI and increasing competition from China, and optimism about the resilience of the innovation-driven sector.
Regulatory Environment and FDA
While regulatory unpredictability persists, panelists emphasized that the FDA has become more productive and engaged, particularly with smaller and middle-market pharmaceutical companies. The agency’s activity and resource deployment increased despite ongoing volatility due to several executive orders announcing significant changes to agency policy and new initiatives. The FDA continues to move forward, and the environment is seen as one of opportunity. Panelists highlighted a rise in unannounced manufacturing plant inspections, which, while creating operational speedbumps, are generally manageable and do not represent insurmountable barriers and are viewed as a quality control check for foreign manufactured products. For investors, this means that diligence around quality systems and inspection preparedness is increasingly important.
Drug Pricing
Drug pricing remains a bipartisan issue. Most Favored Nation-style pricing concepts resurfaced in policy discussions, particularly for new drug launches, although previous attempts at implementation during the first Trump administration were struck down by courts. Panelists noted that recent and prospective pricing reforms are primarily aimed at large-cap pharmaceutical companies, with limited near-term impact expected for middle-market firms, with ripple effects that affect drug classes as a whole. The structure of these reforms, which are generally prospective, allows companies to adjust their budgets without jeopardizing their development pipelines. For investors, this environment may create opportunities for mid-market innovators, as pricing pressures on large pharma could lead to growth opportunities.
Onshoring and Supply Chain Strategy
Onshoring and supply chain strategy continue to be top-of-mind for life sciences investors and operators. Investors have a growing bias toward U.S.-centric supply chains, as “Made in America” positions can simplify due diligence, reduce exposure to tariffs and geopolitical risks, and mitigate regulatory uncertainties. U.S.-based supply chains also tend to lower deal execution risk and ongoing compliance costs. Panelists cautioned that fully domestic strategies may come at the expense of cost advantages or access to global markets, as biotech supply chains have historically been effective across borders. When evaluating supply chain strategy, investors should weigh the incremental value of clarity and inspection readiness against the opportunity cost of foregoing global options.
China’s Role in the Industry
China’s role in life sciences R&D has grown dramatically, with the number of new clinical trials rising from approximately 160 a decade ago to around 1,250 last year, compared to about 1,440 in the United States. This transformation is fueled by significant academic investment and rapid advances in AI-driven research and development. However, this growth brings strategic and compliance complexities, including concerns about intellectual property theft, national security and evolving export controls. The panel emphasized that U.S. competitiveness in this sector will depend on continued investment in foundational research, robust data infrastructure and advanced manufacturing capabilities.
CDMOs and Manufacturing
The contract development and manufacturing organization (CDMO) landscape continues to evolve, with outsourcing creating a range of attractive opportunities and organizations of varying scale. Recently, large pharmaceutical companies have been increasingly rewarded by the U.S. government for bringing manufacturing capabilities in-house and onshore to the United States, including for precursor materials. The surge in demand for GLP-1 products also influenced capacity allocation, pricing and strategic planning across the CMO/CDMO sector. Investors are searching for value in acquiring and retrofitting existing CDMOs to meet new drug application sponsors’ outsourced manufacturing needs more efficiently than building new facilities from scratch. The adoption of modern, AI-enabled manufacturing technologies can further reduce costs and enhance quality control, even without full vertical integration.
Future of AI Adoption
AI is now a baseline expectation in the life sciences sector. Panelists agreed that there will soon be no viable life sciences business model without some form of technology enablement, with manufacturing and pharma services standing out as areas in which AI can drive significant efficiency and differentiation. The foundation of successful AI adoption is high-quality, well-governed data, which is essential for leveraging AI in discovery, development, operations and commercial execution. Because AI is increasingly integrated into regulated processes — such as validation, documentation, audit trails and quality controls — compliance must be built into these systems from the outset. Investors should prioritize platforms with disciplined data architecture, clear and measurable ROI use cases (such as yield optimization, trial recruitment and forecasting), and regulatory-ready controls.
Looking ahead, despite ongoing policy uncertainty and geopolitical complexity, the life sciences sector continues to demonstrate strong innovation and resilience. Investors who adopt disciplined and objective assessment of target companies’ regulatory strategies, pragmatic approaches to onshoring, informed risk management, and AI-enabled operating models will be best positioned to capture value and drive growth across the life sciences ecosystem.
Articles in this series can be found on the conference website under the “Key Takeaways” section.