7 Indicators Pointing Towards Life Sciences Growth In 2024

The year 2023 was indeed quite a challenging year for the life sciences industry, which was marked by a chilly biotech financing environment, uncertainty when it came to legislative and policy changes, as well as an unpredictable macroeconomic outlook. Yet one also witnessed many advances within cell and gene therapies, the launch of new effective drugs so as to treat patients with obesity, as well as mounting excitement when it comes to the promises of AI in terms of drug discovery as well as clinical development. Looking ahead to 2024, the leaders in the life sciences sector will be looking out for indicators of progress: signs when it comes to advancement across the eco-system that go on to suggest an enhanced as well as sustainable environment in which scientific advances can get translated to patient benefits in a more rapid and effective way. Let us look at some suggestions when it comes to what to look for as indicators of growth for life sciences in 2024.

1. Is there a possibility that the XBI Biotech Index may see a recovery of at least 20% in 2024?

It is well to be noted that in 2023, one witnessed a sustained slump when it comes to investment flows as well as financial market returns ever since the heights of 2020-2021 within the life sciences sector. This happens to be a stark contrast to the scientific breakthroughs along with the promises that have risen from start-ups and more mature firms alike. Although the broader S&P500 index went over to see a rise of almost 25% last year, the SP& Biotech Index XBI elevated less than 10%, and the broader S&P Pharmaceuticals Select Industry Index garnered just 2%. All types of biotech financing, be it venture capital investment, debt financing, as well as the IPOs, happen to be significantly down as compared to their 2020- 2021 levels. This has gone on to place significant stress on start-ups that are in requirement of financing or are looking for certain exit strategies through the public markets.

As one looks ahead to 2024, the big question is whether the XBI biotech index will see a recovery, as this is going to best reflect the support for the crucial discovery as well as the early-stage development of the next wave when it comes to innovative therapies, vaccines, cures, as well as other contributors to individual patient outcomes along with population health. There happen to be positive signals for a continuation of the recovery that went on to begin in late October 2023 because of a number of factors, which included the expected drop in the overall rates of interest, a possible soft landing when it comes to the general economy, a much more promising tech-biopharma partnership, as well as increased M&A activity.

2. M&A activity: Is the growth in M&A activity going to continue and be sustained all through 2024 at a level that’s 30% higher?

It is well to be noted that M&A was not the lifeline in the last year, as many expected, but due to a robust rally toward the end of 2023, the overall activity level for the year happened to be around 30% higher than the 2022 level. The fact is that acquisitions by larger companies having smaller biotechs, as well as mergers of biotechs, were the mainstay of the life sciences spectrum and also critical to maintaining productive portfolios in the case of innovative medicines, speeding up clinical development, and also bringing novel treatments to patients.

But the pressure from the growing interest rates, rising inflation, and concerns when it came to a potential recession, as well as increased scrutiny by the Federal Trade Commission- FTC went on to put a damper on M&A as well as deal-making during most of the last year. This was in spite of lesser valuations for numerous smaller companies, healthy financing capabilities in larger companies, and a requirement for replenishment of pipelines to minimize the impact of growing patent losses. Significantly, Amgen could claim victory when the FTC enabled it to move forward with its $27.8 billion acquisition of Horizon Therapeutics with a settlement agreement in place. There are certain analysts who believe the FTC’s decision goes on to suggest that reviews of other pending pharma deals could go on to pan out favorably for the companies that are involved, in spite of the final resolution as well as the unwinding of the Illumina-Grail merger.1

3. The use of new gene therapies: Is it going to be possible that more than 2% of all U.S. patients with sickle cell disease get access to treatment with new, approved cell-based gene therapies?

A bright spot when it comes to the life sciences sector happens to be the continued evolution of cell and gene therapies. It is well to be noted that CRISPR-Cas-9 editing has shown promise for treatment when it comes to sickle cell disease, as per the recent studies. On December 8, last year, the U.S. FDA went om to give its approval to two milestone treatments, which were Casgevy as well as Lyfgenia, the first cell-based gene therapies in case of the treatment of sickle cell disease in patients who were 12 years of age and older.2

But the treatment of sickle cell disease with gene therapy happens to be highly complex as well as very costly. Although the therapy may be pretty effective when it comes to clinical trials, offering that promise to patients when it comes to the real-world settings may go on to face quite significant challenges. Sickle cell disease mostly affects a susceptible and underserved population having a limited and fragile access to sustained as well as quality healthcare. There are almost 100,000 people in the USA that are affected due to sickle cell disease3, and there happen to be special racial and ethnic issues when addressing the disease, its aspects, as well as related comorbidities. 4 In addition, the infrastructure that is required so as to deliver this therapy happens to be extremely specialized and is at present available at very few centers, especially at the bone marrow treatment centers that have sickle cell expertise.

Access when it comes to cell and gene therapy happens to be a critically significant challenge. There are numerous patients with sickle cell disease, including minority children in families, who are covered by Medicaid. However,  a recent analysis done by the Alliance for Regenerative Medicine happened to find many hurdles when it came to accessing at the state level for cell and gene therapies in patients as well as providers, given the dearth of state resources as well as policies in this emerging field of medicine. States mostly do not have a formal Medicaid coverage policy in terms of the availability of cell and gene therapy products in the state, thereby delaying patient access while the manufacturer as well as the state adjudicate coverage.5 Moreover, several sickle cell patients happen to be so advanced in their disease that gene therapy is clinically not warranted.

It is well to be noted that the FDA approval when it comes to the first cell-based gene therapies in terms of sickle cell disease goes on to represent a phenomenal  breakthrough for patients suffering from this rare disease. Being the first approved medicine in the U.S. to make use of CRISPR gene-editing technology, this nod may also go on to hold exciting promises when it comes to other diseases. For the life sciences industry, these novel treatments go on to offer a test case for the pace with which revolutionary treatments go on to reach the patients who will benefit from them. In this regard, tracking the number of patients in the sickle cell population who will get access to the CRISPR technology as well as achieve the advantages of the therapy in the first year will happen to be a marker of growth.

4. Reimbursement when it comes to transformative drugs: Will broader reimbursement of novel breakthrough drugs for the treatment when it comes to obesity bring a growing patient access?

2023 went on to see a dramatic rise in the novel diabetes drug GIP as well as the GLP-1 receptor agonists when it came to weight loss therapy. 6 The nod along with the launch of novel medications for the treatment of obesity happens to be an inflection point when it comes to rethinking the safeguard as well as the treatment of obesity as an intricate, heterogenous, chronic multidisease that’s associated with other critical health conditions. The field happens to be very competitive, with over 143 new molecules in active clinical development as well as more than eight global pharmaceutical companies working with their versions of GLP-1’s and GIP receptors, such as oral formulations that will go on to replace the injectable route of administration. 7  A minimum of six large clinical trials on obesity drugs are anticipated to have results reported in the coming 12 months. 8

Payers as well as employers happen to be concerned when it comes to the potential for increased costs due to the demand for these novel obesity treatments. Employers in the U.S. anticipate the biggest ever jump in healthcare costs in a decade, as per Mercer, Aon, and Willis Towers Watson, the healthcare benefits consultants who happen to be seeing employer healthcare costs between 5.4% and 8.5% this year. 9  While the surge in costs is explained by numerous factors, employers as well as their benefits consultants point to the rising demand for expensive obesity treatment drugs as well as the wider availability of high-priced gene therapies. Of the forecasted 8.5% surge in employer healthcare costs in 2024, Aon expects that the 1% increase in costs happens to be coming from drugs for obesity treatment only.

Some payers, such as Medicare, do not go on to reimburse drugs when it comes to the treatment of weight loss, but the growing body of evidence in terms of outcomes benefits from the use of GLP-1’s for the treatment of obesity is going to potentially lead to a law revision that doesn’t allow Medicare from reimbursing weight loss drugs. In a recent study that happened to be published in the New England Journal of Medicine, a leading GLP-1 drug, semaglutide, was found to slash the rate of heart attacks by 28% in patients who happen to be already taking statins and other medications in order to prevent heart problems. The drug also decreases the rate of cardiovascular-related deaths by 15% and strokes by 7%. 10

5. AI adoption when it comes to life sciences innovation: Will a minimum of 30 drug candidates with AI platforms go on to advance in clinical development?

The explosive focus on AI also happened to impact the healthcare eco-system, with revived predictions that AI will go on to revolutionize healthcare delivery along with life sciences R&D.

AI will undoubtedly have a significant and growing role when it comes to life sciences R&D, innovation of the product, and commercialization, but the evidence of a positive effect at scale on life sciences still happens to be in its infancy. Moreover, as more research happens to be conducted and the opportunities and challenges are better gauged, numerous challenges are growing to the top of the discussion, such as the issues around cultural as well as racial bias when it comes to the development and deployment of algorithms, issues when it comes to algorithmic hallucinations, and general concerns in terms of the safety of AI in terms of therapeutic interventions.

The positive evidence when it comes to the value of AI and machine learning has been most convincingly given in diagnostic medicine, especially where machine learning happens to be superior to the clinician in performing screening of huge amounts of visual imaging datasets when it comes to ophthalmology, dermatology, as well as pathology.

For the life sciences sector, there happens to be emerging evidence in terms of the value of AI in terms of clinical development, specifically when it comes to enhancing operational efficiencies with regards to study design site identification as well as patient recruitment, clinical monitoring, pharmacovigilance, and patient care. 11

But there are also some dominant barriers to broader adoption when it comes to AI in drug discovery as well as in development concerning key factors like understanding the biology of disease, issues when it comes to data quality, AI tool challenges like bias in algorithms, along with the dearth of capabilities in making use of AI.

As of date, no new drug has gone on to get developed and approved on the basis of fully AI-generated drug discovery, but the pipeline of drugs when it comes to development with AI-associated platforms happens to be growing. In 2023, a minimum of 19 drugs happened to be in clinical development attributed to AI, and a few of these drug candidates may very well be advancing within the clinical pipeline in 2024. 12

6. Bipartisan legislation: Will the average patient out-of-pocket drug cost per retail prescription be reduced by more than 10%?

The 2024 presidential election may as well be the first since 2008 when it comes to healthcare reform as well as the Affordable Care Act- ACA. As one can anticipate pretty close election results, probably with politically divided executive as well as legislative branches and the full execution and implications of the IRA of 2022 still building up, further major health policy changes may appear to be unlikely.

Rather, significant legislation should be anticipated with regards to pharmacy benefits management, where there is a broad bipartisan agreement in place. The legislation, which goes on to have several different proposals, will impact how pharmacy benefit managers- PBMs negotiate price discounts along with drug manufacturers. The intent of the legislation is to shed light when it comes to complex pharmaceutical supply chains as well as the role that PBMs go on to play as intermediaries when it comes to drug manufacturers and patients. The hope remains that drug prices will be lowered by increasing transparency, passing on the discounts to plan sponsors as well as/or patients, and reducing out-of-pocket costs when it comes to beneficiaries, as prices will get tied to net prices instead of list prices.The success of PBM legislation will go on to be evaluated on the basis of whether it decreases drug prices for patients, as increased transparency in as well as of itself does not lead to an enhancement in the supply of drugs to patients. 13 Apparently, in 2022, the average final cost per retail prescription happened to be $9.38, whereas 1.9% of all patients went on to pay over $1,500 out-of-pocket for their prescriptions. Uninsured patients paying cash for a branded drug spent an average of almost $88.71 per prescription.14

7. Disruptors in delivery when it comes to primary care: Will more than 30% of primary care physicians be employed by corporate entities by the end of 2024?

The primary care landscape, which goes on to account for almost $260 billion in yearly healthcare spending, happens to be ripe for transformation, pushed by the progress of direct-to-consumer telehealth and vertical integration when it comes to the retail healthcare sector, as well as the rise of payviders, which happen to be integrated financing as well as delivery systems. It is well to be noted that traditional offerors happen to be under pressure from the new disruptors such as Amazon, CVS Health, Aetna, UnitedHealth Group/Optum, Humana, the Walgreens Boots Alliance, as well as Walmart, and also tech companies like Apple and Google/Alphabet, which have all staked their claim when it comes to primary care and happen to be making use of their platforms in order to expand their services. 15 As part of this particular shift, the number of primary care physicians who were employed by corporate entities is indeed increasing, from July 2020 to January 2022. The percentage of physicians employed by corporate entities has gone on to grow from 15.3% to 21.8%. 16

There are certain health insurers that happen to be expanding into home care services, helped by advances when it comes to digital health as well as logistics technology, as the main element when it comes to transforming the delivery of care. By combining home health, pharmacy, as well as primary care services, the companies take up the home as a more convenient setting when it comes to individuals, which potentially can go on to lower costs as well as offer a powerful touchpoint in order to gauge as well as manage the holistic health in case of an individual. This also reflects a common belief that home health can very well be the next frontier in the value-based medicine evolution.

While nobody will be able to forecast what will happen to the life sciences vertical in 2024, these seven areas may go on to offer useful signals to the sector. It is very important that life sciences leaders go for innovation, not just when it comes to R&D along the product level but throughout the entire life sciences enterprise, and also discover new business models, collaborations as well as partnerships.

It may not come as a surprise that important events and issues will most likely occur that are not addressed above, but the more the life sciences industry is well prepared for tackling the trickiest known issues, the better the industry is prepared so as to navigate the unknown issues.


1. Illumina Announces Decision to Divest GRAIL, Dec 17, 2023, https://investor.illumina.com/news/press-release-details/2023/Illumina-Announces-Decision-to-Divest-GRAIL/default.aspx
2. FDA Approves First Gene Therapies to Treat Patients with Sickle Cell Disease. https://www.fda.gov/news-events/press-announcements/fda-approves-first-gene-therapies-treat-patients-sickle-cell-disease
3. Data & Statistics on Sickle Cell Disease. Centers for Disease Control and Prevention. Last reviewed: July 6, 2023. https://www.cdc.gov/ncbddd/sicklecell/data.html
4. Racial and ethnic differences in sickle cell disease within the United States: From demographics to outcomes. Pokhrel A et al. European Journal of Haematology. May 2023. https://pubmed.ncbi.nlm.nih.gov/36710488/
5. Issue Brief: Medicaid Barriers to Accessing Cell & Gene Therapies. The Alliance for Regenerative Medicine. November 2023. https://alliancerm.org/medicaid-barriers-to-accessing-cell-gene-therapies/
6. Obesity Treatment Rates Increase as GLP-1 Inhibitors prosper. IQVIA.Mar 17, 2023. https://www.iqvia.com/library/white-papers/obesity-treatment-rates-increase-as-glp-1-inhibitors-prosper
7. Pipeline of new molecules for obesity. CT.gov. TrialTrove and Pipeline Intelligence. Dec. 2023.
8. Obesity: Six trials to watch over the next 12 months. Abigail Beaney. Clinical Trials Arena. June 30, 2023. https://www.clinicaltrialsarena.com/features/obesity-trials-to-watch/?cf-view
9. US employers to see biggest healthcare cost jump in a decade in 2024. Leroy Leo and Khushi Mandoware. Reuters, Sept 21, 2023 https://www.reuters.com/world/us/us-employers-see-biggest-healthcare-cost-jump-decade-2024-2023-09-20/
10. Semaglutide and Cardiovascular Outcomes in Obesity without Diabetes. Lincoff, Am et al. New England Journal of Medicine. November 11, 2023. https://www.nejm.org/doi/full/10.1056/NEJMoa2307563
11. AI in Clinical Development. IQVIA White Paper, https://www.iqvia.com/-/media/iqvia/pdfs/library/white-papers/ai-in-clinical-development.pdf
12. Global Trends in R&D 2023. IQVIA Institute. Feb 2023. https://www.iqvia.com/-/media/iqvia/pdfs/institute-reports/global-trends-in-r-and-d-2023/iqvia-institute-global-trends-in-rd-2023-forweb.pdf
13. Pharmacy Benefit Manager Transparency Act of 2023. Michael Fiori. IQVIA white Paper. March 29, 2023. Andrea Park. Fiere Biotech, Jul 12, 2023. https://www.iqvia.com/-/media/iqvia/pdfs/us/white-paper/2023/pharmacy-benefit-manager-transparency-act-of-2023.pdf
14. The Use of Medicines in the U.S. 2023. The IQVIA Institute for Human Data Science. Apr 2023. The Use of Medicines in the U.S. 2023 – IQVIA
15. Healthcare Disruption: 2023 Outlook. The Buzz Market Scan. February 2023. https://www.aha.org/system/files/media/file/2023/02/The-Buzz-Disruption-Outlook-2023.pdf
16. A Growing Number of Physicians are Employed. Philip Miller. AMN Healthcare. May 6, 2022. https://www.amnhealthcare.com/blog/physician/perm/a-growing-number-of-physicians-are-employed/