Thermo cites Catalent, capacity, and Trumpian tariffs in positive CDMO outlookThermo cites Catalent, capacity, and Trumpian tariffs in positive CDMO outlook

During the 43^rd JPM Conference in San Francisco, California this week, Thermo Fisher CEO Marc Casper told investors the firm's contract development and manufacturing organization (CDMO) division is focusing on “building sustainable capacity [...] as the market adjusts to changing dynamics.”  

He said, “When we look at our position, we operate in three areas – in drug products, biologic and vaccine, and in clinical trials, [along with] supply and logistics, which is basically binding, packaging, and distribution of experimental medicines.” He emphasized that Thermo Fisher is well positioned for growth, especially beginning in 2026 and beyond. 

The CEO highlighted the industry's evolution since 2019, driven by pandemic-era vaccine and therapy needs, followed by the push toward glucagon peptide-1 (GLP-1) products for diabetes and weight loss, which has created lucrative opportunities. He spoke about rolling GLP-1 contracts and the impact of competitor Catalent’s exiting the market.  

“Catalent, which would’ve been a fine company [to] compete with, has been acquired by Novo. That takes capacity out of the market. So, from our lens, it takes an option off the table, which I think is ultimately very positive for us.” 

Novo Holdings acquired CDMO Catalent in a $11.7 billion deal driven by production needs for GLP-1 drug Wegovy. Despite being lobbied against by unions and consumer groups, the deal received regulatory approvals and is set to close soon. 

Calling the acquisition a “pivotal moment that reshaped competitive dynamics,” Casper said, “We will finish the pandemic runoff and start ramping up the GLP-1 contracts that will kick in.” 

Casper detailed the company’s strategy to navigate headwinds in the CDMO market while addressing emerging opportunities. He underscored Thermo Fisher’s focus on improving operations, reducing inventory, improving supply chain performance, and increasing capacity as the building blocks for sustainable growth. “Building capacity is not just about increasing production but ensuring we are ready to meet the demands of future therapies,” he said. 

Thermo, Trump, and Tarriffs 

The CEO took a positive stance on the administrative change in the US. Casper noted that the industry is not a major focus for Trump but remained “highly confident” that the focus would be on building a better business environment. 

“I think the mergers and acquisitions (M&A) environment in terms of regulations is clearly going to be better. So, from that perspective, it will be a big positive. And you're going to have a focus on a pro-growth environment from a taxation perspective as well.” 

His optimism extended to Trump’s tariff plans, which seek to increase taxes on imported goods from countries such as China. “I think we all learned a lot from the last round of tariffs, and we also learned a lot about supply chain through the pandemic.” 

“And my take, whichever tariffs happen, we will be well positioned given our global footprint to navigate that as effectively or more effectively than anybody and help our customers do that as well,” said Casper.