Price pressure is a top growth barrier in every CDMO segment, according to new research from Simon-Kucher, PharmaSource, and CDMO Live. Yet pharma respondents expect to pay more for US-based manufacturing under trade pressure and want to use performance-based pricing far more than it is used today. For CDMO and pharma leaders, the 2026 pricing challenge looks less like a fight over price levels and more like a question of model design, proof of value, and execution.
CDMOs face pricing pressure from two directions in 2026. Customer price pressure is the most frequently cited growth barrier across early-phase, late-phase, and end-to-end CDMOs. At the same time, pharma respondents signal that they expect to pay more in some circumstances and want commercial models quite different from those most commonly used today.
These findings come from the CDMO Growth Report 2026, based on the 2026 CDMO Growth Survey conducted by Simon-Kucher in collaboration with PharmaSource between January and May 2026. The survey draws on more than 120 respondents from over 100 companies across Europe, APAC, and North America, including roughly 70 CDMO experts and around 45 from pharma. Because customer and supplier answers are compared directly, the report can show where pricing expectations match and where they diverge.
Taken together, the findings suggest the CDMOs that perform best on price will be those that can explain, structure, and prove the value customers are paying for, rather than those that simply hold or cut their rates.
A Market Recovering Unevenly
Results for 2025 varied widely by segment. Late-phase CDMOs, which support Phase 3 through commercial manufacturing, performed best against their own plans. Some 43% significantly exceeded their growth targets and a further 21% slightly exceeded them. None reported a significant miss.
Early-phase CDMOs had a harder year. Four in ten slightly missed their targets, 40% met them, and none significantly exceeded them. The report links this to early-stage biotech funding, which has not returned to previous levels and continues to put pressure on pricing.
End-to-end CDMOs fell between the two. Most met or came close to their targets, but broad capabilities across the lifecycle did not produce the strongest results. The report suggests these providers may need to state the value of integration more concretely, for example faster program progression and simpler governance.
Pharma showed a similar split. Established pharma was more likely to beat its targets, while emerging biopharma tended to meet targets without many clear outperformers.
Expectations for 2026 change the picture. End-to-end CDMOs are the most optimistic segment: 78% expect 2026 to be somewhat or significantly better than 2025. Early-phase CDMOs have also regained confidence, with 70% expecting improvement. Late-phase CDMOs, coming off a stronger year, are more measured. Among pharma respondents, emerging biopharma has the strongest improvement outlook, while established pharma is positive but more cautious.
Price Pressure Is the Common Headwind
Price pressure runs across this. Increased customer price pressure is the top growth barrier in every CDMO segment, cited by 40% of early-phase, 53% of late-phase, and 58% of end-to-end CDMOs. Competitor capabilities and capacity come close behind. The report reads this as a primarily commercial set of pressures, meaning growth will depend on sharper differentiation and stronger pricing discipline as well as available demand.
Pharma faces price pressure too. It is the top barrier cited by established pharma (41%), although emerging biopharma is most exposed to regulatory complexity (63%).
Pricing is also a growth lever. Price and mix improvement through commercial excellence is the third most cited CDMO growth driver at 47%, after more targeted marketing and sales (67%) and capacity expansion (49%). Among early-phase CDMOs it ties for first at 60%. Emerging biopharma respondents name pricing and mix improvement as the single most important growth driver for their CDMO partners, at 46%.
Discounting Is Not the Default Response to Excess Capacity
Capacity expectations differ between buyers and suppliers. Nearly half of pharma respondents expect continued capacity constraints in 2026, while CDMO views vary widely by segment. Early-phase CDMOs mostly expect balanced or excess capacity.
How CDMOs plan to respond to excess capacity matters for pricing. The most common response is commercial: 74% plan to increase sales, business development, or marketing activity. Price cutting is much less common. 22% of early-phase CDMOs would reduce prices or offer temporary discounts to fill capacity, compared with 9% of end-to-end CDMOs and none of the late-phase CDMOs surveyed.
Late-phase CDMOs prefer to adjust terms. 70% are willing to offer more flexible arrangements, such as shorter contracts, faster starts, or capacity holds, to overcome deal closure barriers and cover site fixed costs.
The report’s guidance is that CDMOs with available capacity should communicate access, reliability, and flexibility without resorting to price concessions. As capacity becomes more available, it argues, competitive advantage will depend increasingly on targeting the right customers, articulating differentiated value, and protecting pricing while improving utilization.
Pharma Expects US-Based Manufacturing to Cost More.
On outsourcing, the two sides expect different things. 45% of CDMOs expect somewhat or significantly more outsourcing growth in response to the geopolitical environment. More than half of pharma respondents (54%) expect at least some increase in insourcing.
These are expectations, not commitments, and they should not be read as a forecast that outsourcing will contract. Still, the report concludes that outsourcing can no longer be assumed, particularly with established pharma, where internalization is becoming a more serious option. In its words, a CDMO’s biggest competitor in periods of geopolitical uncertainty may be the customer’s own manufacturing network. CDMOs therefore need to show why external manufacturing is the better choice, in terms of execution speed, specialized expertise, resilience, and risk, and not only on capacity and cost.
Both sides agree that manufacturing networks are expected to become more regional, more diversified, and more resilient. Among established pharma, 42% expect a significant shift toward regionalized supply chains and 26% expect greater use of near-shore and dual-sourcing models. Emerging biopharma also expects networks to become more distributed, with more emphasis on keeping flexibility and access to alternative supply.
Regionalization also affects pricing. Asked about US-based CDMO projects under global trade pressure, 47% of pharma respondents expect prices to rise by 5–10%, and a further 35% expect increases of more than 10%. CDMOs are considerably more conservative, and most expect prices to stay broadly stable or rise only modestly. The report suggests pharma may be more prepared than CDMOs for the cost of regional manufacturing and reduced geopolitical exposure, and that CDMOs may be underestimating the pricing headroom that comes with those benefits.
The report is careful on one point: a price premium cannot be justified by geography alone. It has to rest on capabilities a customer can verify. The full report covers the regional footprint findings by segment in more detail.
Resilience Has to Be Proven
The resilience findings expose a clear gap.
58% of pharma respondents expect CDMOs to demonstrate a proven ability to maintain supply during past disruptions. Only 13% of CDMOs report having measures in place to address that expectation.
The gap stands out because the two sides agree on most other resilience measures. Pharma expectations and CDMO actions are broadly in step on dual- or tri-sourcing of key inputs (47% versus 45%), diversified manufacturing and supply networks (43% versus 49%), and local or secondary sites in key markets (30% versus 29%). The disconnect sits almost entirely in one area: evidence that supply held up when disruption actually happened.
The commercial point follows. Resilience can strengthen a value proposition and, according to the report, support pricing. But sites in several regions do not, by themselves, prove resilience. The report argues that the strongest resilience claims will be backed by data, examples, and governance routines showing how continuity was protected.
Strategic Partnership Is Becoming More Important
Pharma is putting more weight on strategic partnerships with its CDMOs. The shift is strongest among emerging biopharma, where 65% say strategic partnerships are becoming significantly more important. Established pharma shows what the report calls a more mature pattern: most still see partnerships becoming more important, but with less urgency, likely because many already have them in place.
CDMOs are reorganizing in response. Around 80% of CDMO respondents expect the business development role to shift from transactional selling toward strategic partnership management.
The two sides agree on the basics. Trust, transparency and open communication, joint long-term planning and shared strategic objectives, and willingness to share risks and benefits are at the top of the definition for both pharma and CDMOs.
Beyond those basics, priorities differ by segment. For example, 41% of emerging biopharma respondents associate strategic partnership with co-investment in innovation, technology, or capacity, compared with 7% of established pharma. Established pharma places more emphasis on integrated quality and regulatory collaboration. As Clarita Havermeier, Director, Pharma Services at Simon-Kucher, puts it in the report: “Both sides seek the same thing: clarity from the start, clear commitments from everyone, open communication, and explicit expectations.”
The full report breaks down partnership drivers across emerging biopharma, established pharma, and the three CDMO models. It shows how each brings a different working definition of what “strategic” means into the relationship.
Where Pricing Expectations Go Unmet
The report measures customer and supplier pairings on two scores. Goal alignment shows how closely pharma’s priorities match what CDMOs believe pharma values. Expectation fulfillment shows how consistently CDMOs are perceived to deliver. In three of the four pairings studied, fulfillment falls well below alignment. Pricing-related expectations account for many of the largest gaps.
The established pharma × late-phase CDMO pairing shows this clearly: 77% goal alignment, but 44% expectation fulfillment. Established pharma ranks partnership-oriented price models as its second-highest priority, with a 13% preference share behind quality and compliance track record (17%). Late-phase CDMOs assign those pricing models just 5%. They put far more weight on tight timelines (22%) than established pharma does (10%). In the report’s assessment, CDMOs read established pharma reasonably well overall but overestimate speed and underestimate one of pharma’s most important commercial priorities.
Fulfillment is weakest in the same area. 54% of established pharma respondents say almost no or only a few CDMOs meet their expectations on partnership-oriented price models. 46% report the same about total cost transparency and predictability. Communication and collaboration perform much better, with 62% saying most CDMOs meet expectations. The report concludes that the relationship layer is working better than the commercial layer beneath it.
Emerging biopharma’s concern is more basic. For this segment, cost-effectiveness ties with tight timelines as the top collaboration priority, at 13% preference share each, compared with 9% assigned by late-phase CDMOs. Only 6% of emerging biopharma respondents say most CDMOs meet their cost-effectiveness expectations, while 75% say around half do. The report stresses that cost is not a secondary concern for emerging biopharma but sits alongside speed.
The full report includes priority-by-priority analysis for each partnership pairing.
Pharma Wants Pricing Models That Share Risk
The report describes pricing as becoming a core part of strategic partnership design. The commercial question now covers how models allocate risk, how performance is rewarded, where capacity needs to be secured, and how the value proposition becomes credible.
Current practice still relies on more established models. Among partnership-oriented pricing models, milestone-based payments are the most widely used (65%), followed by discounted rates tied to long-term commitments (47%) and take-or-pay models (47%). Performance-based pricing and dedicated suite models are each used by 35%.
Pharma preferences point elsewhere. 65% of emerging biopharma and 60% of established pharma say they want to use performance-based pricing more. Established pharma also shows strong interest in dedicated suite models (60%). Emerging biopharma shows strong interest in milestone-based payments and discounted rates tied to long-term commitments (53% each).
The report’s main point is the gap between current practice and future expectations. Pharma interest is moving toward models that share risk, reward performance, secure access, or support longer-term commitment, but current usage has not caught up. The report concludes that a strategic partnership cannot rely on a standard cost-plus and fee-for-service approach if the customer expects the CDMO to share risk, commit to performance, or offer commercial flexibility in return for longer-term commitment.
Pricing Is Becoming a Commercial Capability
CDMOs’ own commercial priorities reflect some of this. Differentiated value propositions rank as the most impactful marketing and sales initiative across early-phase (60%), late-phase (71%), and end-to-end CDMOs (54%).
Commitment to value-based pricing discipline varies more. 46% of end-to-end CDMOs rank it among their most impactful initiatives, compared with 21% of late-phase and 10% of early-phase CDMOs. The report suggests that CDMOs with broader capabilities increasingly treat pricing as a strategic capability rather than a transactional exercise.
Speed of quoting is also on the agenda. Half of late-phase CDMOs prioritize faster quotation processes, and 58% of CDMOs plan AI investment to improve quotation efficiency, although only 10% have invested so far.
The report argues that leading CDMOs are connecting business development, marketing, pricing, operations, and technical functions into integrated commercial capabilities. The goal is to identify the right customers, communicate value more effectively, respond faster, and convert opportunities at higher margins.
What Changes in 2026
Taken together, the findings point to several shifts:
- from discounting to fill capacity toward flexible terms and clearer value articulation
- from cost-plus and fee-for-service toward performance-based and risk-sharing models
- from geography as a pricing argument toward demonstrable resilience as the basis for a premium
- from treating pricing models as secondary toward treating them as a core partnership expectation
- from late-stage price negotiation toward earlier conversations about commercial models
The last shift reflects one of the report’s clearest recommendations: pricing model expectations, resilience proof points, and governance should be discussed before the RFP process has narrowed the conversation to price and timeline alone.
The full report sets out separate actions for pharma companies and CDMOs, including recommendations on signaling and designing commercial models, quantifying the value of resilience and flexibility, segmentation, and governance.
Conclusion
Price pressure in the CDMO market is real, and every CDMO segment reports it. But the research suggests that competing harder on price level is not the main answer. Pharma customers indicate they are prepared to pay for value they can verify, including regional supply, proven resilience, and pricing models that share risk and reward performance. In many partnerships, they say those expectations are not yet being met.
As Kaan-Fabian Kekec, Partner, Pharma Services at Simon-Kucher, says in the report: “The gap in this industry is not ambition or capability. It’s the conversations that both sides keep deferring. Have them earlier.”
The CDMO Growth Report 2026 examines these gaps in detail. It includes the full partnership-oriented pricing model analysis by CDMO and pharma segment, US pricing expectations under trade pressure, pricing and cost fulfillment gaps by partnership pairing, excess capacity strategies, growth drivers and barriers, resilience proof points, and recommendations for both pharma companies and CDMOs.
Download the full report to explore the complete findings.
