2025 Global Life Sciences CEO Outlook

Foreword In an age of heightened disruption, Life SciencesCEOs areoptimistic. Many anticipate strong growth over the comingyears on the back of new innovation and technology-drivenincreases in efficiency. Appetite for M&A remains high —particularly for new therapeutic areas and capabilities — A key theme that emerges across the report is theimportance of empowering the workforce to adaptand experiment in this rapidly evolving sector. CEOsrecognize the importance of enabling humans with In this report, KPMG’s network of regional Life Sciencesleaders explore the results of a recent global survey of110 Life Sciences CEOs from around the world. Supportedby practical insights and recommendations, its intentionis to help sector leaders, stakeholders and investors This balance between innovation and efficiency is creatinginteresting opportunities for CEOs. We expect to seecontinued divestment of non-core assets as organizationssharpen their market focus, unlocking capital to investinto new innovation and driving transformation across Liz ClaydonGlobal Head of Life Sciences,and Global Head of Deal Advisory Executivesummary of Life Sciences CEOsexpect to achieve earningsgrowth of more than2.5%55% Confidence in the strength of the industry is up andthe majority of Life Sciences CEOs expect to achieveearnings growth of more than 2.5 percent. Our survey ability to enable their workforces to adapt, retrain andexperiment. In part, leaders plan to attract and retaintalent by narrowing the expectation gap of differentgenerations within the workforce, through strategies like Interestingly, our survey indicates that organizations inthe sector are moving from experimentation and pilotsto operationalization and value creation of AI enabledtechnology. Yet the data also shows a clear focus oninnovation with significant investment going into areas Sustainability and ESG remain high on the agenda fororganizations globally, though application and focusvaries depending on the region. While this may have Ultimately, our survey of Life Sciences CEOs suggeststhat growth will come from a combination of innovation With the market rapidly evolving, CEOs recognize thatsuccessful execution of their objectives hinge on their Keyfindings Enabling workforces 73%expect most corporate staff 85%think that workforce AIreadiness will have an impact What is on the minds of Life Sciences CEOs? 83%80%86%are confident in thegrowth prospects of theindustry — up 16 percentagepoints from 2024have already adaptedtheir growth strategies inresponse to interrelatedmarket challengeshave a moderate-to-highappetite for M&A over thenext three yearsIndustry snapshot expect returns on their AI investmentswithin the next three years Embedding sustainability say AI has given their organizationsenhanced decision-making and integrate the costs and ROI ofsustainability initiatives into every Top 3 challenges impacting short-termdecision making expect AI to help themreduce emissions and 1.Integration of AI into organizationalprocesses and systems 2.Supply chain resilience/Technologicaldisruption (two-way tie) Industrysnapshot How do they expect to achieve that growth? According to oursurvey, innovation and efficiency will play key roles. Top of thelist of operational priorities for sector leaders this year is thedesire to advance digitalization and connectivity across their Moderate-to-high appetite forM&A over the next three years89% Despitesignificant market uncertainty andconcerns about economic growth, LifeSciences CEOs are increasingly confident.In our survey, 83 percent voiced confidencein the growth prospects of the industry —up 16 percentage points from 2024. At the But as demonstrated in a recentM&A report by KPMG International,1nearly 60 percent of deals actuallydestroy shareholder value rather thancreate it, suggesting CEOs may betrying to refocus on deals that deliver Q.What is your organization’s earnings outlook over the next three years? Many also clearly expect to achieve growth through inorganicroutes, with 86 percent of respondents saying they have amoderate-to-high appetite for M&A over the next three years Our survey also uncovers a number of challenges thatare influencing short-term decision making as CEOschart their path to growth. Perhaps not surprisingly,they are concerned about the difficulty of integrating broader technological disruption. Likely reflecting recentgeopolitical tensions, tariff environments and supplyrestrictions, many CEOs noted the need to significantlyimprove supply chain resilience — citing it as both a top Life Sciencesleaders arebecoming more selective anddisciplined about M&A bylooking for sustainable valueand long-term performancerather than short-term gains. Liz Claydon Global Head of Life Sciences andGlobal Head of Deal Advisory “Supply chainsare becoming increasingly complex,particularly as global trade norms evolve and new risksemerge,” adds Peter Liddell, ASPAC Region Head ofLif