10 Challenges Life Science Companies Must Confront in 2025

3/10/2025 Frank Costello

Few industries are as demanding as life sciences. As a company, you must be aware of and manage intense regulatory considerations and changes — and cope with research and development costs, watch over intellectual property concerns, and ensure that you’re keeping up with ever-advancing technologies. 

What follows are 10 critical factors currently putting life sciences companies through their paces as they strive to confront today’s industry realities. It’s essential to evaluate where your company stands with each — and decide on a course of action that will enable you to move forward and see progress in the year ahead. 

1. Margin pressures

Mounting pressures on profitability margins — especially amidst persistent high inflation — create an undeniable challenge in the life sciences sector. Although rates have subsided since first coming out of the COVID-19 pandemic, the current annual inflation rate continues to hover around 3%, according to the U.S. Bureau of Labor Statistics. 

The industry also continues to grapple with other unique pressures, including global supply chain challenges, escalating clinical trial costs, lengthy R&D cycles, patent expirations, elevated healthcare costs, and complex regulatory landscapes.

To navigate this challenge, assume a “more with less” mentality. Work to identify single-source, end-to-end partnerships with experienced partners who can find and deliver tangible efficiencies and cost savings.

2. Increasing labor-shortage issues

Talent scarcity is an industry-wide issue: 77% of life sciences and healthcare companies report having difficulty finding the talent they need, notes ManpowerGroup. In addition, replacing retiring employees with skilled new ones was cited as the number-one workforce challenge by life sciences CEOs in a recent survey by KPMG.

This scarcity of talent can lead to increased labor rates, impacting your company’s overall cost structure and profitability, and reduced productivity. Reasons for life sciences labor shortages can include everything from aging workforces and early retirements to unskilled applicants and high demand. In fact, healthcare had the highest number of job vacancies in all sectors, according to a 2023 McKinsey study. 

To mitigate these risks, consider investing in comprehensive training programs and establishing structured knowledge-transfer initiatives to bridge the experience gap between retiring experts and younger workers. Additionally, foster a culture of continuous learning and development to attract and retain top talent.

3. Seeking faster, better, and more cost-effective alternatives

Margins are under threat, necessitating strategic initiatives to accelerate product development and market entry — all while reducing costs. Developing and bringing products to market at a faster pace outpaces your rivals at getting your products into customers’ hands. This can result in increased market share and first-to-market revenue advantages, offsetting some development costs.

However, you must still account for regulatory confines, maintain quality standards and good manufacturing practices, and ensure an effective and efficient commercialization workflow in the process. 

Partnering with an FDA-registered and cGMP-compliant organization can ensure adherence to industry best practices, safeguarding product quality and regulatory compliance. An ideal partner can also provide expertise to streamline workflows, leverage emerging technologies, and enhance overall efficiency. This strategic alliance can empower companies to capitalize on market opportunities — ultimately securing a competitive edge.

4. Vendor and supply chain consolidation

Supply chain reconfiguration and vendor consolidation can be important considerations as you seek to control costs and maximize efficiencies.

Supply chain disruptions, including raw material shortfalls and logistics challenges, continue to pose risks. In a recent Deloitte survey, 48% of surveyed medtech executives and 30% of biopharma executives said supply chain and manufacturing risks could significantly impact their 2025 strategies. 

Vendor consolidation can help mitigate these risks. When evaluating vendors, prioritize economies of scale and value-adds. Use these questions to assess vendors:

• Does the vendor support your company’s business goals? 
• Do they proactively identify solutions to your unique challenges? 
• Do they provide fresh ideas that contribute to your company’s bottom line? 
• Do they provide efficiencies in relation to cost, delivery time, risk, quality, compliance, and/or sustainability?

5. Tariffs and reshoring production to the U.S.

As the U.S. and other countries trade tariff measures, life science companies are forced to cope with lasting supply chain effects. If your company has relied upon offshoring in the past, you may now be seeking other options as global dynamics shift and tensions arise in the geopolitical supply chain.  

Reshoring, nearshoring, and friendshoring are three alternative strategies to consider.

• Reshoring — returning production to your company’s original country can provide operational control
• Nearshoring — relocating production to a nearby country can minimize logistical challenges while also offering cost advantages compared to domestic production 
• Friendshoring — sourcing from trusted companies and/or countries with shared interests can help stabilize your supply chain, even though doing so may not necessarily offer as many economic advantages

6. Product fragmentation and the advent of medtech

The pharmaceutical industry is witnessing fewer “blockbuster” products. Instead, companies are pursuing more targeted precision therapies and niche technologies. These require both shorter runs and faster turnaround times, which can strain your company’s resources and challenge workflows. 

Simultaneously, medtech — wearables, AI diagnostics, and robotics — offers convenience and precision. However, medtech's rapid innovation cycle adds another layer of complexity. Companies must be agile enough to integrate new technologies and adapt to evolving regulatory landscapes.

To succeed, prioritize agility, technology investment, regulatory navigation, and patient-centricity, or partner with an expert in this area.

7. Increased need for personalization and customization

When it comes to healthcare providers and patients, one size definitely does not fit all. Personalization and customization have become vital for delivering impactful messaging, tailored content, and individualized services and products.

Developing a plan to increase personalization can benefit your company — and patients — in multiple ways, including:

• Increasing patient engagement — via patient portals, email, and apps
• Strengthening relationships with HCPs — utilizing data to deliver customized information to healthcare providers to benefit patient care
• Supporting regulatory compliance — tailoring communications with legally compliant information
• Addressing patients’ safety concerns — with individualized instructions, warnings, and guidance
• Improving health outcomes — via condition-specific information, medication reminders, and treatment adherence support

8. Continued interest in and investment in sustainability

Consumer demand for sustainable products and packaging continues to rise, with PwC reporting that 80% of consumers are willing to pay more for sustainably sourced goods. For life sciences companies, developing and investing in sustainable solutions for your products, services, and facilities can help you meet this demand — and comply with increasingly stringent regulations.

To meet sustainability objectives, consider:

• Utilizing biodegradable and compostable materials, including paper-based solutions, for products and packaging, and limiting non-sustainable consumables
• Limiting packaging waste 
• Extending tool life cycles
• Improving energy efficiencies throughout your company’s facilities, including lighting, heating/cooling, energy monitoring, ensuring the facility is up to code, and integrating renewable energy sources

9. Brand consistency

Standardizing messaging, materials, and specifications across multiple channels is critical — especially if you’re currently offshoring or nearshoring production. Consistent branding serves to improve brand recognition, create trust, and increase customer loyalty. Alternately, inconsistent branding can lead to a disjointed customer experience and a loss of trust.

Work to:

• Develop comprehensive brand guidelines and a clear brand identity
• Establish a dedicated brand team, overseeing brand consistency across all channels
• Leverage Digital Asset Management (DAM) and Content Management Systems (CMS)
• Utilize technology to aid in monitoring and maintaining consistency 
• Regularly train your employees — and vendors

10. Shifts in the evolving content delivery models

Driven primarily by patient and consumer demand for personalized, accessible communications, industry leaders are shifting their content delivery to more effective channels and models. 

An omnichannel approach — one that seamlessly integrates digital platforms with more traditional models — will help ensure increased response and engagement. Take full advantage of the wide variety of channels available to you and strategically leverage:

• Social media
• Websites
• Apps
• Events
• Podcasts
• Webinars 
• In-person consultations

Preparing for the challenges ahead

As your company navigates 2025 and beyond, it’s imperative to take into account all of the aforementioned challenges. 

Collaborating with a partner that’s knowledgeable of industry best practices — and the obstacles that may be encountered — can help ensure you are prepared for the road ahead.