Pharmaceutical CDMO outsourcing sector: Panel discussions point to a constructive medium-term outlook for differentiated pharmaceutical CDMOs

Overview

Goldman Sachs summarises a panel with Bora Pharmaceuticals and Neuland Laboratories at Asia Healthcare CDMO Day 2026. The discussions supported the institution’s constructive view of pharmaceutical outsourcing, with differentiated CDMOs benefiting from resilient supply-chain strategies, peptide demand and selective investment in complex modalities.

Core views

The panel indicated that outsourcing demand remains structurally healthy even as biotech funding is more selective. Neuland reported its highest-ever RFP inflow in 1H, up more than twofold year on year. Bora signed 14 new preclinical molecules in 1H26, materially above historical levels, and said its 1H26 development-program wins had already exceeded its FY25 total. Management attributed this activity to established pharmaceutical and biotech customers advancing multiple programs after a period of capital discipline, rather than a return to pre-COVID venture-funded demand. Neuland also said roughly eight of ten major pharmaceutical companies were repeatedly evaluating Indian CDMOs, an intensity of engagement not seen in the past decade. Supply-chain regionalisation was presented as an active execution trend rather than simply a cost-optimisation discussion. Geopolitical uncertainty, COVID-era disruption and tariff risks are driving China+1 and regional manufacturing strategies. Customers increasingly value resilience, redundancy and geographic diversification, while pharmaceutical supply chains are being viewed more through a national-security lens. This changes supplier selection in favour of CDMOs that can offer multinational sourcing and differentiated manufacturing capabilities. The clearest operational example was growing demand for US manufacturing despite a substantial cost premium. Bora estimated US labour costs at approximately five to eight times those in Taiwan and overall manufacturing costs at three to five times higher depending on product. Even so, RFPs for its Maple Grove facility rose fivefold, and roughly half of new enquiries specified US-only production. The demand is predominantly from innovator pharmaceutical companies rather than cost-sensitive generic manufacturers. Bora estimated its US network was approaching about 70% utilisation from existing and pending contracts, above the roughly 55% level where management believes profitability begins to inflect positively. The panel also noted that US onshoring is more prevalent for formulation, while APIs continue to be sourced largely from lower-cost Asian locations. Peptides, propelled by GLP-1 demand, were described as the most visible outsourcing growth opportunity. Neuland said global peptide programs in clinical development expanded from approximately 600 in early 2025 to around 1,000 by May 2026, putting pressure across the manufacturing ecosystem. As industry investment concentrates in upstream peptide synthesis, Neuland is directing capital toward downstream purification and lyophilisation to offer an end-to-end peptide API capability. Bora sees opportunity in injectable manufacturing and, longer term, potential migration toward oral solid-dose GLP-1 products. Both companies expect peptide manufacturing supply-demand imbalances to persist for several years. For advanced biologics, the panel favoured selective investment rather than broad capacity expansion. About 70% of Bora’s biologics business now involves bispecific, trispecific or conjugated monoclonal antibodies, supported by roughly 20,000 litres of single-use bioreactor capacity. Bora has avoided ADC-conjugation investment because of specialised facility requirements and uncertain returns. Neuland likewise remains cautious on ADCs, oligonucleotides and bioconjugates, citing talent availability and customer confidence as constraints for India-based manufacturing; management suggested a North American footprint may ultimately be a more viable route into these technologies. AI is producing tangible but gradual efficiency gains. Neuland uses digital twins for process scale-up and AI tools for deviation investigations involving complex batch records that can exceed 500 pages, while preparing a 200,000-square-foot paperless process-development facility in Hyderabad for launch by November. Bora’s Bora AIM initiative is expected to have six AI agents by year-end and has reduced time spent on quality investigations and documentation workflows by 10-20%. Both companies expect adoption to broaden, but regulatory oversight should limit the speed of implementation relative to less regulated industries.

Analysis framework

The report synthesises management commentary from Bora Pharma and Neuland Labs, beginning with customer-engagement indicators and then tracing how localisation, manufacturing economics, peptide capacity needs, complex-biologics investment choices and AI adoption affect CDMO demand and positioning.

Methodology notes

• Industry AnalysisSupply-demand framework

  Peptide manufacturing supply-demand analysis

  The report uses the rise in peptide-development programs and expected capacity bottlenecks to explain why peptide outsourcing imbalances may persist for several years.

• Industry AnalysisUpstream-Midstream-Downstream Transmission

  Peptide value-chain positioning

  It distinguishes upstream peptide synthesis from downstream purification and lyophilisation, explaining Neuland’s choice to invest in downstream capabilities as upstream capacity attracts more industry investment.

• Competition & strategyValue chain analysis

  Manufacturing footprint and service differentiation

  The discussion compares resilience, geographic diversification, formulation and API sourcing, and specialised capabilities as factors influencing CDMO supplier selection.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Neuland Laboratories (NEUL.BO)

  Covered API-focused CDMO positioned to benefit from sustained outsourcing demand, India engagement and peptide downstream investment.

  Strengths

  Record 1H RFP inflow; repeated evaluations by major pharmaceutical companies; focus on downstream peptide purification and lyophilisation.

  Weaknesses

  Management remains cautious on advanced modalities such as ADCs, oligonucleotides and bioconjugates because of talent and customer-confidence constraints.

  Comparison

  Unlike Bora’s drug-product and US manufacturing footprint, Neuland is an India-based API-focused CDMO serving innovator customers globally.

  Risks

  Product, customer and geography concentration; execution in new businesses and complex products; potential regulatory-compliance issues.

• Bora Pharmaceuticals (6472.TW)

  Panel participant and drug-product CDMO illustrating demand for resilient, US-based manufacturing.

  Strengths

  Fivefold increase in Maple Grove RFPs; approximately half of new enquiries specify US-only manufacturing; US network nearing roughly 70% utilisation.

  Weaknesses

  Higher US cost structure and deliberate avoidance of ADC-conjugation investment due to specialised requirements and uncertain returns.

  Comparison

  Bora is focused on drug products and formulation manufacturing, while Neuland is API-focused.

Key data

• Neuland 1H RFP inflow+2x y/yHighest RFP inflow in the company’s history.
• Bora new preclinical molecules14 in 1H26Management said this was materially above historical levels.
• Maple Grove RFP growth5xIncrease in RFPs for Bora’s US facility.
• US-only manufacturing enquiries~50% of new enquiriesReflects greater customer willingness to pay for supply-chain security.
• US labour-cost premium versus Taiwan~5-8xBora’s estimate.
• Overall US manufacturing-cost premium~3-5xBora’s estimate, depending on product.
• Bora US network utilisation~70%Based on existing and pending contracts, versus an estimated ~55% profitability inflection level.
• Global peptide clinical programs~600 in early 2025 to ~1,000 by May 2026Neuland management’s estimate of expanding development activity.
• Bora biologics mix~70%Share involving bispecific, trispecific or conjugated monoclonal antibodies.
• Bora single-use bioreactor capacity~20,000 litresCapacity supporting its biologics business.
• Bora AI efficiency gain10-20%Reported reduction in time spent on quality investigations and documentation workflows.

Impact & implications

The report argues that differentiated CDMOs are increasingly selected for supply-chain resilience and specialised capability rather than lowest cost alone. US formulation capacity, peptide downstream services and disciplined biologics investment may be particularly relevant areas of positioning, while regulation limits how quickly AI productivity gains can reshape operations.

Risks

• For Neuland Labs, the report identifies product, customer and geography concentration risk.
• The report identifies execution risk in new businesses and complex products for Neuland Labs.
• Potential regulatory-compliance issues are an explicit risk for Neuland Labs.