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The pharma industry is projected to see continued growth through 2030 — but not without sizable challenges along the way.

By the end of the decade, global prescription drug sales are expected to top $1.75 trillion. 

However, historic changes are afoot for the industry, as China gains steady ground on U.S. pharmaceutical production and policy upheaval marks an era of uncertainty, according to several recent reports.

Evaluate’s annual World Preview Report, which examines the state of the pharma industry through the next five years, found that demand for prescription drugs globally remains high — enough to buoy the industry forward amid such turbulence.

The report estimates that drug sales worldwide will experience an annual compounded growth rate exceeding 7% over the next several years. 

Predictably, obesity drugs and GLP-1s will lead the charge, generating 20% yearly growth between 2024 and 2030.

Still, this year’s report is “not all business-as-usual,” the authors wrote, noting that policy uncertainty, regulatory changes at the Food and Drug Administration and funding cuts at the National Institutes of Health are causing challenges for an “already risky sector.”

That uncertainty is also contributing to the industry holding back on large dealmaking and IPOs, weakening “the M&A life-raft” that proved so vital to a suffering biotech industry in 2023 and 2024.

“Biotech, bruised from a five-year downcycle, is not out of the woods,” the authors continued.

China’s growing influence

Amid an ongoing trade war and speculation about the next tranche of tariffs by President Donald Trump, China’s influence in the pharmaceutical market continues to grow.

Pharma products sourced from China will account for 40% of all licensing deals in 2025,  the report found, compared to 3% just five years ago. This represents a massive shift towards China holding more dominance as a global leader in pharma, given it can produce best- and first-in-class molecules more quickly and cheaply than the U.S.

“The implications for Western biopharma are profound,” the authors wrote. “R&D efficiency must improve, or even the U.S. risks playing second fiddle to a nation that appears to be delivering what Western payers and consumers want: cheaper, faster innovation.”

Looking ahead, AI will continue to play a critical role in boosting domestic pharma efficiency, but to what extent is yet to be seen.

Questions also remain around the impact of increasing dealmaking with China — such as whether it will divert investment dollars from the U.S. and Europe.

What are the growth factors?

Still riding the unprecedented wave of popularity, GLP-1s are expected to be a boon through 2030.

The Evaluate report estimates that Eli Lilly’s tirzapetide, the main ingredient in Mounjaro and Zepbound, will reach $62 billion in sales by 2030.

That’s noteworthy because it’s three times as much as the peak sales for AbbVie’s blockbuster Humira, which held the spot as top-selling drug for several years. Merck’s Keytruda currently holds that spot, but is facing a patent cliff in 2028 as well as generic competition.

While Novo Nordisk was the initial frontrunner in the obesity sphere, Lilly is gaining ground and will likely be the dominant player in the space moving forward, per the analysis.

Lilly’s oral GLP-1 orforglipron and its triple agonist retatrutide are currently considered two of the most valuable pipeline contenders.

Other therapeutic areas that will continue to see sustained growth include immuno-inflammatory and oncology. AbbVie’s Skyrizi and Sanofi/Regeneron’s Dupixent in the immuno-inflammatory sphere are expected to be listed among 2030’s top 10 best-selling drugs.

However, thanks to pending patent expirations, Big Pharma is also expected to be hit with some $300 billion in lost sales by the end of the decade.

Merck is taking proactive steps in the face of Keytruda’s cliff, with the company’s sub-cutaneous formulation of the drug expected to be approved by the FDA later this year. This makes it one of the most valuable pipeline drugs, the authors noted.

All quiet on the IPO front

Amid policy changes at the federal level — including the impending threat of pharma tariffs — M&A and IPOs remain muted, according to EY’s Biotech Beyond report.

Following a post-pandemic boom in M&A  in 2021 and 2022, Big Pharma saw a slowdown in dealmaking activity in 2023 and 2024. 

While industry sentiment remained optimistic last year — banking on election results to provide some clarity and a return to a more industry-friendly Federal Trade Commission — that mindset was short lived.

Interest rates did fall in 2024, but Big Pharma largely avoided major consolidation, instead gravitating towards smaller deals.

The number of public biotechs also dropped from 939 in 2022 to 783 in 2024, a come-down from the large number of IPOs during the COVID-19 pandemic.

The report highlighted one bright spot: the amount of venture capital being fundraised by biotechs in 2024 was higher than pre-pandemic levels. Early venture rounds reached about $15.5 billion, close to the peak in 2021.

While venture capital fundraising rounds have grown, they have been for significantly fewer companies.

The EY authors urged pharma companies to manage policy and tariff uncertainty moving forward by re-evaluating their supply chain, conducting customs mitigation and risk planning, rethinking their investment and cost structures as well asexamining tariff exemptions.

“This is not a time for making predictions, as they don’t age well,” the EY report authors wrote. “However, as in any challenging environment, there will be opportunities for the bold. Companies with de-risked assets will continue to tap into capital from Big Pharma companies with formidable fire power, and there is potential for M&A to thrive once uncertainty lifts.”