CDMO Capacity Crunch Persists Despite New Investment
Nearly half of biopharma companies still can’t find CDMO capacity — even as sponsors turn their own plants into contract manufacturers.
Nearly half of biopharma companies report ongoing difficulty finding CDMOs with available manufacturing capacity — a gap persisting even as the industry pours capital into new facilities and alternative sourcing models.
What’s Driving the Gap
Demand for outsourced manufacturing keeps climbing, but the perception of a capacity shortage doesn’t always track with actual market reality. Some pharmaceutical companies are now offering their own excess capacity under a CDMO business model, primarily in mammalian cell culture — effectively becoming contract manufacturers to their competitors.
The Trust Problem
This approach carries real friction. Companies offering excess internal capacity as CDMO services can shift priorities quickly, and will generally protect their own pipeline over contract clients when capacity gets tight — a dynamic that breeds distrust among sponsors relying on that capacity. Biosimilars compound the conflict further: companies must decide whether to manufacture biosimilars for outside clients or reserve capacity to compete with them directly.
What This Means for Procurement Teams
Don’t assume capacity announcements solve the problem. Sponsors continue reporting they can’t secure needed manufacturing capacity even as CDMOs expand — treat capacity claims as a starting point for due diligence, not a guarantee of availability when you need it.
Weigh conflict-of-interest risk in hybrid CDMO relationships. A pharma company offering you excess capacity is still a pharma company with its own pipeline priorities — build contractual protections around capacity guarantees rather than assuming goodwill will hold under pressure.
Take a longer-term view on sourcing strategy. Companies evaluating out- versus in-sourcing are increasingly thinking beyond immediate cost savings toward multi-year capacity security — a shift worth matching in your own procurement planning.
FAQ
Why is there still a CDMO capacity shortage despite industry growth?
Demand for outsourced manufacturing is growing faster than genuinely available, trustworthy capacity, and some of the “new” capacity entering the market comes from pharma companies with competing priorities rather than dedicated CDMOs.
What is the risk of using a pharma company’s excess capacity as a CDMO?
These arrangements can shift quickly since the host company will generally prioritize its own products over contract clients when capacity is constrained, and biosimilar conflicts of interest can complicate the relationship further.
How should sponsors respond to ongoing capacity constraints?
Build longer-term, strategic sourcing relationships rather than transactional ones, and specifically evaluate whether a CDMO’s capacity claims hold up under contractual guarantees, not just current availability.