Bridging The Disconnect: Commercial Clarity And Communication Will Define The Future Of CGT CDMOs

By Heather Sugrue, owner and principal consultant, Chrysalys Bio

The cell and gene therapy (CGT) industry may have one of the most promising futures in biotech, but let’s acknowledge reality: it’s still an emerging industry. It’s expensive. It’s complex. And for all its potential, it’s not yet scalable in a way that supports large-scale therapeutic supply and distribution. Developers need higher yields, better titers, and scalable technologies before large indications become a reality. And the most significant area yet to be truly investigated is how to get these breakthrough therapies to patients.

How Did We Get Here?

It all began when the FDA started approving CGTs from 2011 to 2017. This sparked the interest of larger CDMOs eager to enter what was perceived as an extremely lucrative market. Following this trend, two leading global CDMOs acquired North America’s top gene therapy CDMOs for nearly 10 times their market value, further fueling the misconception about the potential of this sector. The impact was significant, with the COVID-19 pandemic throwing fuel on the fire of these misperceptions.

As the perception of CGTs’ profit potential climbed, interest from private equity firms, venture capitalists, and biotech startups increased dramatically. With billions of dollars being invested, the industry witnessed a sixfold growth in the CGT CDMO market from 2019 to today, alongside a 50% increase in early-stage pipeline assets. However, despite the significant growth in the asset pipeline, approximately four times that amount would be necessary for the roughly 220 CDMOs to meet the revenue targets set by private equity and venture capital firms.

Now That We’re Here, What Is The Problem? CGT Wasn’t Ready.

The massive growth was built on speculation, rather than a solid foundation or readiness. Large CDMOs ventured into CGT as if it were an easy extension of their biologics or small molecule business. It’s not. And that misperception and lack of understanding have created an industrywide bottleneck.

Here’s why the model is struggling:

1. CGT ≠ Traditional Modalities — The number one mistake: treating CGT like oral solids or biologics. It’s not. Research, development, and manufacturing in CGT require a distinct model, mindset, and operational design. It is an emerging field with significant potential for improvement, so continued investment in R&D is still necessary for enhanced systems and processes.
2. The Talent Pool Is Diluted — The numerous acquisitions and misdirected investments have diluted expertise among developers and CDMOs. What was a concentrated number of experienced talent is now spread across a much larger market. Meanwhile, 90% of the existing workforce comes from the biologics space, which is not CGT and therefore requires additional training. Universities are only now producing Ph.D.s specialized in CGT, but not nearly at a rate fast enough.
3. We’re Lumping Cell and Gene Together — These two therapies are fundamentally different modalities, yet they’re often marketed and managed as one. This lack of differentiation leads to misalignment from day one. What services are you selling? Both the equipment and talent required for each are highly specialized, so claiming expertise in both is a clear indication that you may not be managing your business effectively.
4. The Misperception of the Opportunity — The number of assets currently under development is in the hundreds, not the thousands. As a result, every CDMO is competing for approximately the same 1,000 CGT assets. The numbers simply do not support the likelihood of success for all these organizations. Yet, the sales and revenue targets are being set as if the market potential were in the tens of thousands.
5. Not Acknowledging the Entire Supply Chain — In advanced therapies, the product isn’t the only thing that’s personalized; the supply chain is, too. It’s more intimate than other supply chains, where all parts rely on each other, full stop. There is a much higher need for cross-departmental communication that extends beyond the walls of the manufacturing facility. Yet, most CDMOs focus only on the part of the journey they manufacture, ignoring the end-to-end process and the vein-to-vein aspect. This is what makes “personalized” medicine truly personal.

These five foundational issues are now colliding with the biggest and most inherent challenge that often leads to the demise of the CDMO…

6. Cross-functional Miscommunication — Business development and operations must collaborate closely; there must be a strong bridge of communication and mutual understanding regarding the services being offered. BD needs to sell only what operations can deliver, and operations must deliver what BD sells. In the context of CGT, this alignment is even more critical; a shared understanding of the science and the “what we do” is vital. When CDMOs set unrealistic sales and revenue goals, the BD messaging of “what we sell” may diverge from the operational reality of “what we do.” This pressure to “bring in any project” can overshadow the need to pursue opportunities that align with our actual capabilities. Such misalignment has been evident in the industry, resulting in BD teams signing projects that do not correspond to operational capabilities. Consequently, operations may struggle to deliver, leading to frustration and blame. Within three years, this situation can result in financial losses for the business and an urgent need to find solutions.

What Should Happen Instead?

Begin with honesty and alignment. Clearly define your service offerings. Understand your client profile. Identify your true differentiators. Acknowledge the patient's journey and think outside of the four walls of your facility. Only after these steps are taken can you create effective messaging, forecast accurately, scale strategically, and guarantee reaching your sales and revenue goals.

What To Do

To save an investment or realign previously made decisions, course correction is essential. For CDMOs to thrive, they need to adopt a strategic approach based on transparency, internal alignment, and a solid understanding of the market. The following recommendations provide a foundation for building a profitable and successful CGT service offering:

1. Conduct a comprehensive cross-functional assessment. Evaluate the alignment between business development and operations. Understand if the services being positioned are indeed executable and whether internal resources are prepared to deliver them.
2. Equip business development with the right tools. Provide business development teams with appropriate tools and training for effective prospecting, qualification, and client engagement. Modern CRM systems, market intelligence platforms, and dynamic prospecting tools should be strategically configured for optimal use.
3. Refine costing and pricing models. Implement a consistent and transparent approach to pricing that includes all service verticals. Ensure that costing structures are accurate, margins are preserved, and that commercial teams can quote confidently.
4. Standardize the RFP-to-proposal workflow. Create clear SOPs that outline the roles and responsibilities of each stakeholder, from business development and proposal writers to subject matter experts and project managers, ensuring consistency and accountability in every proposal.
5. Strengthen your marketing and messaging. Develop brand clarity through updated messaging, visual identity, and market presence. Companies must clearly communicate who they are, what they do best, and who they serve. Marketing, business development, and operations should work in lockstep on this initiative.
6. Foster a culture of communication. Break down silos by creating regular forums for cross-departmental collaboration. Establish a communication structure that fosters transparency, shared key performance indicators (KPIs), and collective accountability.
7. Know your market. Analyze the market potential for the business you are servicing. Create territories that correspond to the locations of assets and establish targets that align with the potential in each territory. Set your BD up for success.
8. Bring the patient into your process. Begin by acknowledging that your supply chain extends beyond your direct control. Then, examine the entire workflow, from patient scheduling and collection to handoff, manufacturing, release, and return. If you can’t manage it internally, partner wisely. Some organizations specialize in this area. By aligning with a best-in-class case management partner, you demonstrate that your thinking goes beyond your walls and the batch. Own the entire journey, even if you don’t control every step.

When these foundational principles are applied early on — or revisited honestly — CGT CDMOs are much more likely to meet expectations, reduce internal turnover, scale responsibly, and ultimately develop a long-term growth strategy that aligns with their sales and revenue objectives. This is achievable. But first, ask yourself if you genuinely wish to be part of this transformative industry that enhances personalized medicine. If you aspire to become the leading CDMO in this highly promising sector, take the time to carefully consider your next steps.

About The Author:

Heather N. Sugrue is the owner and principal consultant of Chrysalys Bio. With 17+ years of experience in the CDMO space, she helps CGT companies align business development with operational execution, transforming struggling CDMOs into confident, profitable, high-performing organizations.