With the cell and gene therapies (CGTs) sector facing multiple challenges even as it celebrates successes, there was plenty for experts to discuss at the 2025 Cell & Gene Therapy Summit. Hosted by Charles River Laboratories, the March 4 event featured several sessions, including “Industry Updates on Advanced Therapeutics 2025” and “Investor and Market Insights.”

During the industry update, keynote speaker Rita Johnson-Greene, chief operating officer of the Alliance for Regenerative Medicine (ARM), shared insights into the current state of the cell and gene therapy market. In 2024, there were approximately 3,000 developers and 2,000 clinical trials in the CGT space, reflecting year-over-year increases of 6% and 3%, respectively. Additionally, investments in cell and gene therapy reached $15.2 billion, marking a 30% growth compared to 2023.

“I know that 2024 was a very tough market, and it’s a very tough time for cell and gene therapy, but a 30% increase year on year from a dollars-invested perspective, that’s extremely important to note,” Johnson-Greene said.

On the date of the presentation, 13 of the 15 largest pharmaceutical companies by market cap were investing in the development and/or commercialization of cell and gene therapies, including AbbVie, Astellas Pharma, Bristol Myers Squibb, Novartis, Roche and Vertex Pharmaceuticals.

Despite Multiple Challenges, the Future Is Bright

During her session, Johnson-Greene acknowledged that the CGT sector has its challenges. For example, she said, the cost of goods is high, although she believes cell processing innovations will bring them down.

Other hurdles Johnson-Greene mentioned were that some therapies face issues related to efficacy, safety and durability of response and require complex treatment regimens. She also cited competition, complex patient dynamics and very small patient populations, especially in the rare and ultra-rare disease space.

Although there are multiple challenges, Johnson-Greene noted the importance of CGTs’ impact on patients, especially those with rare diseases, as they have shorter lifespans.

“This is why we do what we do,” she said. “This is why we get up in the morning. This is why we work so hard, right? It’s for our patients.”

As she discussed where the CGT sector is headed, Johnson-Greene had an optimistic take on it. She noted that in 2019, Scott Gottlieb, the FDA commissioner at the time, predicted that by 2025, the FDA would approve 10 to 20 cell and gene therapies per year. In 2024, she said, it approved nine, making Gottlieb’s prediction for 2025 likely to come true. Johnson-Greene noted that eight decisions were pending, and as many as 15 total applications could be submitted this year.

At her session’s conclusion, Johnson-Greene emphasized cell and gene therapies’ promising trajectory.

“I believe that the future of cell and gene therapy is bright,” she said.

Investor Behavior Has Shifted, But Funding Opportunities Remain

At the “Investor and Market Insights” session, moderator Ramin Baghirzade, senior director and global head commercial of gene therapy CDMO services at Charles River Laboratories, led a panel discussion about topics including investor sentiment and behavior.

Carl Schoellhammer, associate partner at DeciBio, a strategy consulting and market intelligence firm, spoke specifically about a shift that’s occurred since the COVID-19 pandemic. He said generalist investors who jumped into CGTs at the height of the pandemic are pulling out of the space after realizing that hacking medicine is harder than they thought.

Unreasonable expectations have also been an issue, according to Amit Agarwal, a managing director at Deloitte.

“How you set up your expectations is just as important as actually what’s happening, because I think the markets, in many ways, are expecting every single product that gets approved is in and of itself going to generate a billion dollars plus,” he said. “It just isn’t going to happen.”

Regarding whether the bar for investment has shifted and investors are pickier, Carolyn Ng, partner and managing director at private equity fund TPG Life Sciences Innovations, clarified, “Well, firstly, I think we should always have been picky, because that’s literally our job as an investor. You have to pick the winners. This is not a beta-driven sector. It’s an alpha-seeking sector. So, you have to be able to identify the opportunity set that’s going to break out, especially in categories where we feel like there might be some headwinds.”

Panelists also discussed the timing of investments. Carter Caldwell, program director at Penn Medicine Co-Investment Program, noted that investors’ priorities have shifted.

“So, for investors who may have been wanting to come in on the B, C, D rounds where there was data, I’m seeing some now that are saying, ‘Guess what? No, we actually want to be the first money in,’” he said.

When it comes to fundraising itself, some companies will want to wait on that because valuations are depressed, but that’s not necessarily the best approach, according to Ng and Caldwell. Ng pointed out that it’s hard to predict when the next funding wave will happen.

“If you have conviction in your programs, go out there and tell the story and try to sell it, because there really isn’t a good time that we can predictably foresee,” she said.

Caldwell said companies should give themselves at least a year—“probably more like 18 months right now”—to raise a real round of funding. He advised against companies waiting until their back is against the wall. For those that do, he said, “You’re in the worst position, because you’re going to get the worst terms. Or, more likely than not, people are just going to pass because they’re going to say, ‘We want to see more data before we’re going to put money in.’”

Finding the right fit is also important, according to Caldwell.

“Not every dollar is equal,” he said. “You want the dollar that’s going to come in the door, that’s going to roll up their sleeves, that’s going to be there for the follow-on rounds.”

For entrepreneurs specifically, Caldwell recommended keeping interest group investors in mind when fundraising. For example, he noted, the American Cancer Society has the venture fund BrightEdge.

“Do not discount those interest groups, because they are out there,” he said. “They are for investment opportunities that speak to their focus.”

To learn more about Charles River’s Cell and Gene Therapy CDMO services, visit the webpage.

This article was written in partnership with Charles River Laboratories.