Optimistic 2026 outlook emerges for biopharma industry as JPM26 wraps up

Executives from contract development and manufacturing organizations (CDMOs) were among the companies that made presentations this week at the 2026 J.P. Morgan Healthcare Conference (JPM26) in San Francisco. Most CEOs were decidedly positive about their respective outlooks for this year, having navigated geopolitical and trade tensions (i.e., tariffs) as well as the challenging funding environment in 2025.

Thermo Fisher Scientific CEO Marc Casper in a Tuesday presentation at JPM26 provided a positive outlook for his company, which he said is poised for strong growth in 2026 as a well-positioned industry leader in pharmaceutical services — among other markets.

As one of the world’s largest CDMOs, Thermo Fisher is benefitting from the reshoring of pharmaceutical manufacturing to the U.S., driven by President Donald Trump’s threats to impose industry-specific tariffs and push for Most-Favored-Nation drug pricing.   

"There’s a very big focus on reshoring more production and activity to the U.S. — and that is going to be a tailwind in ‘27 and ’28,” Casper told the JPM26 conference.

WuXi Biologics CEO Chris Chen in a Wednesday presentation at JPM26 said the China-headquartered company expects to see an acceleration in revenue growth in 2026, fueled by complex modalities such as antibody-drug conjugates and bispecific/multispecific antibodies.

Chen claimed that a “leading indicator” of manufacturing growth for the Chinese contract research, development, and manufacturing organization (CRDMO) is the number of process performance qualifications (PPQs). He noted that WuXi Biologics completed 28 PPQs in 2025 and has 34 PPQs scheduled for 2026 based on current contracts.

In a report last week ahead of JPM26, William Blair analysts concluded — using leading indicator data — that this year’s outlook for the outsourcing and services space is optimistic based on the biopharma industry’s funding levels, product pipeline, and research and development (R&D) spending.

“We believe these data points support our previously stated view that now is the time to revisit the space,” the analysts wrote. “On the funding front, we expect the recent uptick in pharma M&A, positive updates on tariffs and drug pricing, and another year of strong drug approvals to result in continued funding strength in 2026, ultimately leading to a rebound in demand from smaller innovators.”

On the policy front, the analysts added that the “recent clarity and positive updates that these drug developers have received over the last couple months around tariffs and drug pricing should free these companies up to start spending more aggressively to rebuild their pipelines after a couple years of culling or sitting on programs.”

As JPM26 kicked off on Monday, AbbVie announced that it struck a drug pricing agreement with the Trump administration in exchange for a three-year exemption from tariffs. The drugmaker also pledged $100 billion in U.S.-based R&D and capital investments, including manufacturing, over the next decade. It is a significant increase from AbbVie’s commitment in 2025 to invest more than $10 billion in its U.S. manufacturing over the next 10 years.

Tailwind for life science tools

Large pharmaceutical companies have promised to invest hundreds of billions in U.S. infrastructure. Thermo Fisher, which in addition to being a CDMO is also a life science tools company, has said Big Pharma’s multi-year investments in U.S. R&D and manufacturing will benefit the company’s analytical instruments, bioproduction, and channel businesses.

In a Friday report to investors at the conclusion of JPM26, Leerink Partners analysts said they see life science tools companies benefitting this year from a decidedly more positive industry outlook.

“The sentiment is improving to optimistic on 2026 with the backdrop of broad 4Q beats, conservative FY26 guides, combined with improving momentum across biotech funding and pharma, continued bioprocess recovery and stabilizing U.S. academic/NIH,” the analysts wrote. 

When it comes to the life science tools sector, William Blair analysts similarly view bioprocessing growth as having largely normalized — biased towards large pharma.

“On the tools side, we expect more of a step-function change in demand, driven by the improving funding environment and stable academia along with resilient biopharma spend, with results improving sequentially throughout the year and 2027 to be a more ‘normal’ year,” according to the analysts.