The CDMO Capacity Crunch Persists

Editor’s Take: CDMO capacity remains tight as sponsors compete for the right manufacturing fit.

Although contract development and manufacturing organizations (CDMOs) have been expanding, demand has also grown. According to BioPlan’s 23rd Annual Survey of Biomanufacturing Capacity and Production, nearly half of biopharma companies say they have difficulties in finding a contract manufacturing organization (CMO) with the capacity they need.

In this year’s survey 49% of qualified respondents cited difficulties finding a CDMO with available capacity for mammalian production, compared to 41.3% in 2025 and 39% in 2024. Microbial fermentation was also cited by a similar percentage of respondents indicating challenges in finding a CDMO, 43.9% vs 36.9% in 2024. Gene therapy/viral and cell therapy continued to be challenged in finding CDMOs with available capacity.

This year, 55.9% indicated difficulties in finding gene therapy CDMOs and 55.6% of respondents for cell therapy (Figure 1). These advanced biotherapeutic areas continue to be experiencing significant CDMO availability constraints.

Figure 1. Availability of CMO/CDMO Capacity (2024-2026)

The challenges involved in manufacturing cell or gene therapies at clinical scale can be driven by each product’s unique vector, cell type, and potency requirements which demand highly tailored processes that deviate from standard platforms.

As a result, many CMOs either choose not to offer these services or require extended timelines to develop and validate custom workflows slowing production compared with more commoditized biologics.

Can CDMOs keep up with demand?

The regionalization of biologics manufacturing is creating a more resilient global supply chain, while also intensifying competition among CDMOs to deliver cost-effective, high-quality biologics at-scale. Smaller start-up biologics innovator companies are entering the industry and increasingly becoming reliant on CDMOs, because these start-up innovators lack facilities, expertise and infrastructure.

So, they often have no choice than to turn to CDMOs. Other companies with relevant facilities and infrastructure continue to selectively outsource their products’ bioprocessing development and manufacturing. Both approaches reduce up-front capital and financing needs, because companies can avoid $50-$100-plus million or more costs for construction of stainless steel-based facilities, with a typical fully single-use facility for commercial manufacturing costing more in the range of $20-$60 million.

Both in-house biomanufacturers and CDMOs are focusing on scaling mammalian cell culture systems. But more CMOs are projecting a 5-year expansion, which has been the trend for 3 years. In 2026, average CMO 5-year expansion for mammalian cell culture was 40.4% compared to 33.8% in 2025, suggesting that CMOs are trying to keep up with capacity demands.

Cell therapy was reported to expect average 5-year capacity expansions by 28.4% of CMOs, only slightly up from 21.8% in 2025. Gene therapy was reported to expect average capacity expansions by 25% of CMOs. This difference was also similar in 2025 with 18.2% of CMOs reporting an average 5-year growth expected expansion (Figure 2).

Figure 2. Average Planned Future Capacity Expansion: Five-Year Estimates, CMOs, by 2031

Factors leading to capacity constraints cited by CMOs included hiring constraints, analytical testing and drug product release, costs associated with downstream purification, and costs associated with upstream processing. It is increasingly evident that capacity constraints are not driven by a single dominant factor but rather by a complex and shifting combination of pressures. What emerges is not a clear, consistent culprit, but rather a dynamic interplay of industry conditions, investment cycles, and evolving operational needs.

One area where capacity is also growing to meet demand is as pharmaceutical companies offer excess capacity by adopting a CDMO business model. This approach has primarily involved capacity for mammalian cell culture.

However, there may be challenges such as difficulty to maintain CDMO services because capacity and focus can change quickly, and these companies will prioritize their own products over CDMO clients. This can lead to distrust of such services. There also might be competing products and interests, which can lead to conflicts of interest.

For example, the rise of biosimilars adds another layer of complexity, as companies must decide whether to manufacture biosimilars for others or focus on their own competing products.

Biopharma capacity perceptions

While demand for outsourced manufacturing services continues to rise, the perception of a persistent capacity shortage may not always align with market reality. Many sponsors begin their search with highly specific technical, geographic, regulatory, or timeline requirements that significantly narrow the pool of suitable CDMOs.

As a result, the challenge is often not the absence of available capacity, but the difficulty of finding capacity that meets a project’s unique needs. At the same time, sponsors’ perceptions are frequently shaped by past experiences during periods of severe industry constraints, even as many manufacturers have since expanded their facilities and capabilities.

CDMOs must have open capacity to remain competitive and attractive to sponsors. The industry is acutely aware of the persistent and evolving capacity constraints. While some of these constraints are new, others have spurred a continuous cycle of technological innovation, strategic investment, and operational transformation over the years.

Manufacturers have designed a range of solutions some strategic and forward-looking, others tactical and driven by immediate needs. Yet their sponsors continue to say they can’t find necessary manufacturing capacity.

While big pharma companies have traditionally taken to outsourcing operations to cut costs, many companies are now deciding to employ a more strategic approach. Overall, companies in the biopharmaceutical industry are evaluating their out- vs. in-sourcing options, including assessing options from a longer-term perspective.

For example, some large biologics innovators will not adopt cutting edge platforms like continuous bioprocessing/perfusion manufacturing until there is a critical mass of CMOs capable of taking on these platforms, essentially, innovators need to know if there are competent CMOs available if they decide to adopt a novel technology platform. Otherwise, they will stick with tried-and-true batch manufacturing.

“[T]he challenge is often not the absence of available capacity, but the difficulty of finding capacity that meets a project’s unique needs.” — Katrina Cordavado

Regional trends

U.S. and EU facilities are generally experiencing similar capacity constraint levels. However, higher percentages in the U.S. continue to indicate moderate and minor constraints. The fact that U.S. has significantly more moderate or significant constraints compared to European facilities might be driven by the several factors.

Especially, higher throughput expectations may translate to more strain for the U.S. facilities. Large-scale U.S. commercial facilities often operate at or near maximum throughput to meet domestic demand, support global supply chains, and rapidly scale pipelines. This “go big or go home” approach can lead to more frequent bottlenecks when something in the process like downstream purification lags.

The U.S. also tends to lead in adopting new technologies and platforms, such as continuous manufacturing, automation, and novel modalities. While this can boost long-term efficiency, it often introduces short-term disruption and variability.

Europe, by contrast, may adopt innovations slower but more steadily leading to fewer operational hiccups. Western Europe’s manufacturing is also often more distributed and modular, with redundancy built in across countries.

Even though European facilities serve wider regions, their design may intentionally mitigate constraint risks by spreading workload across more nodes. At the same time, it is possible that U.S. facilities are simply perceiving and reporting constraints differently, especially as part of internal continuous improvement or compliance initiatives. Europe by contrast might disregard minor delays and not register them as constraints.

Emerging regions, particularly India and China, are becoming major hubs with large-scale GMP facilities and double-digit growth rates, while North America and Europe continue to dominate high-value innovation. Increasingly companies are popping up to serve their domestic, regional, or other international markets that are experiencing rapid growth.

Markets for biopharmaceuticals are growing in India and China, with increased incomes, a growing middle class, and improving health care infrastructure and services. As such, their domestic CDMOs and contract research organizations (CROs) will continue to capture market share in these regions, and many will continue their push to enter established markets in the U.S. and EU.

The industry landscape is also being reshaped by huge investments by CDMOs for facility expansions aimed at meeting evolving market demands. Such expansions clearly reflect the CDMO industry’s movement toward more sophisticated and efficient production.

What’s next?

Capacity remains one of the most persistent challenges in outsourced biomanufacturing, but it is only one piece of the equation. Nearly half of biopharma companies continuing to report difficulty finding CDMOs with available capacity, and this highlights the ongoing imbalance between manufacturing demand and available infrastructure.

As investment in new facilities and manufacturing technologies continues, an important question remains: will CDMO capacity expansion be able to keep pace with the growing and increasingly diverse needs of the industry? At the same time, sponsors are looking beyond available manufacturing slots when selecting their CDMO. Flexibility, technical expertise, responsiveness, and the ability to adapt processes as programs evolve have become equally important differentiators, particularly for emerging biotechs developing complex biologics and advanced therapies.

In the current environment, strategic marketing is becoming increasingly important for CDMOs looking to differentiate themselves to potential sponsors. In an increasingly competitive outsourcing landscape, the CDMOs best positioned for long-term success will be those that combine sufficient capacity with the agility and collaborative approach needed to support rapidly changing development programs.

References

1. 23^rd Annual Report on Biomanufacturing Capacity and Production, BioPlan Associates, Inc. April 2026.

Katrina Cordovado, MBDC, is Director of Research at BioPlan Associates, where she leads research on biomanufacturing technology adoption, capacity, market demand and supply chain trends. Her work includes global biomanufacturing databases, market reports and industry studies supporting biopharma companies, CDMOs and technology suppliers.