The global CDMO (Contract Development and Manufacturing Organization) industry has entered a phase of “focused investment and strategic positioning” in high-growth segments—a trend that remains unstoppable even in the aftermath of sanctions.
After weathering last year's U.S. “Biosecure Act” sanctions tsunami, WuXi AppTec has once again reported explosive performance growth, reaffirming its resilience and long-term growth certainty. On July 10, 2025, WuXi AppTec released its semi-annual performance forecast:
WuXi AppTec will release its official semi-annual report on July 29. Though these are preliminary figures, they indicate a strong return to double-digit growth. In the same period last year, the company posted RMB 17.24 billion in revenue (down 8.64%) and RMB 4.24 billion in net profit (down 20.2%).
Based on this trajectory, WuXi AppTec is on course to exceed its 2023 revenue and profit levels in 2025. Following the forecast announcement, WuXi AppTec's Hong Kong shares surged over 10% on July 11.
Amid ongoing sanctions, the United States is both accelerating support for domestic players—using tariffs to force pharmaceutical manufacturing to return—and strengthening bilateral cooperation with biopharma allies like South Korea to seek alternative supply chain solutions. Geopolitical dynamics are reshaping the global pharmaceutical supply structure, including the competition in the CDMO sector.
As previously reported, the sudden rise of Korean CDMOs last year was partly driven by geopolitical advantages. In this regard, U.S.-based CDMOs should enjoy even greater geographic benefits.
According to public sources, the U.S. had long been preparing to sanction WuXi-affiliated companies. In 2022, the U.S. government issued an executive order promoting domestic biotechnology and biomanufacturing to ensure a sustainable and secure bioeconomy. In 2023, the U.S. Department of Defense announced a $1.2 billion investment for building domestic biomanufacturing facilities, supporting local biotech firms such as National Resilience—a U.S.-based CDMO established in 2020 to protect pharma companies from supply chain disruptions.
Although the 2022 executive order began materializing quickly in 2023 and companies like Merck and Eli Lilly announced expansions of their U.S. manufacturing facilities—potentially pulling back some CDMO orders—the deep dependency of the U.S. pharmaceutical sector on global supply chains limited the actual impact of these "deglobalization" efforts. Suppliers from China, Europe, and elsewhere have continued tug-of-war negotiations with the U.S. Meanwhile, American CDMOs are already showing signs of strain, shifting toward "strategic contraction and bankruptcy protection."
In early June, National Resilience announced the closure of six facilities, mostly related to traditional biologics manufacturing, while filing for bankruptcy protection through a separate legal entity. The six locations include three in Massachusetts, one in San Diego, one in Fremont, California, and one in Alachua, Florida.
The "mass shutdown" stemmed from the company’s “overexpansion of capacity beyond market demand,” forcing it to shutter “underutilized plants,” reflecting dual pressures from industry overcapacity and a capital freeze. Since its founding in 2020, Resilience has raised nearly $2.5 billion and rapidly expanded by acquiring U.S.-based manufacturing sites.
Notably, its sites in Ohio and Toronto remain unaffected and are considered “well-performing” internally, likely due to their focus on production lines for emerging therapies with greater market potential.
In the announcement, CEO William Marth stated that the company will concentrate on high-growth areas such as cell therapy, biologics, and sterile pharmaceuticals—fully aligned with current technological trends in global biopharma, and the very areas where global CDMOs are intensifying investments.
Meanwhile, China's GenScript—a CXO twice named by U.S. authorities—is also doubling down on U.S. operations. In June, its CDMO subsidiary ProBio announced the official opening of its cell and gene therapy manufacturing center in Hopewell, New Jersey. The 128,000-square-foot GMP facility is designed for high-quality plasmid DNA and viral vector (including AAV and LVV platforms) production, showcasing ProBio’s commitment to accelerating the delivery of transformative therapies.
Clearly, the “focused investment and positioning war” in high-growth CDMO fields has begun—an unstoppable trend in the wake of the sanctions tsunami.
From WuXi’s strategy, while it appears to be retreating in the U.S. CGT space, it is aggressively expanding in Europe. In Munich—the "pharma highland of Europe"—WuXi AppTec has acquired Crelux, a company specializing in biophysics and structure-based drug discovery, focusing on crystallography, protein biochemistry, and biophysics. WuXi AppTec is integrating its discovery capabilities in Munich with its expanding production base in Switzerland and its global service network to provide faster go-to-market pathways for European biotech firms and support regional innovation.
Following the Biosecure Act sanctions tsunami, U.S. suppression of China’s pharmaceutical industry continues in 2025. While China still dominates in small-molecule CDMO, large-molecule CDMO is now the battlefield for the “final showdown” among the U.S., Europe, China, and South Korea:
| Region | Core Advantages | Main Challenges | Representative Companies |
|---|---|---|---|
| China | Cost optimization + Full industry chain integration | Geopolitical risks + Lack of original technology | WuXi Group, Asymchem, Pharmaron |
| South Korea | State capital support + Large-scale production capacity | Over-reliance on biosimilar segment | Samsung Biologics, Lotte Biologics |
| U.S. & Europe | Cutting-edge technology + Regulatory leadership | Cost pressure + Lack of capacity flexibility | Thermo Fisher, Lonza |
Additionally, Japan and India are also leveraging their own strengths to seize niche markets. The geographic distribution and strategic positioning of major global CDMO players are illustrated in the following chart.
Multiple institutional research reports point out that global CDMO competition has shifted from being cost-driven to a comprehensive game involving technology, capacity, and policy. South Korean CDMOs, aided by production scale and geopolitics, are quickly addressing technical shortcomings—such as entering the CGT field through acquisitions. Samsung Biologics is also strengthening its ADC capabilities beyond its traditional antibody focus.
To counter South Korea’s capacity dominance and Western technology blockades, China must consolidate its strengths in frontier areas like ADC and CGT. This requires a balanced approach between international expansion and ensuring autonomy over core technologies.
Facing geopolitical risks and international competition, the path ahead for China's pharmaceutical industry is challenging—but we remain resilient and full of hope.
