Gene and Cell Therapy at a Crossroads – End of an Era or Strategic Pivot?

Introduction

In recent months, several major biopharma companies have dramatically scaled back or outright halted their gene and cell therapy programs. This trend—highlighted by Biogen's decision to discontinue all adeno-associated virus (AAV) gene therapy research and Takeda's move to exit the cell therapy field—has raised questions about whether these high-profile departures signal a broader industry shift or merely isolated strategic pivots.

With October 2025 upon us, the gene and cell therapy landscape appears to be at a critical inflection point. In this in-depth overview, we examine whether we are witnessing the end of an era for gene and cell therapies or the beginning of a realignment, exploring recent corporate exits, industry-wide trends, and financial implications across the field.

A Broader Industry Retreat

Far from being isolated incidents, Biogen and Takeda's departures are part of a wider trend of retrenchment among several large pharmaceutical companies in the gene and cell therapy arena.

Biogen's Complete Exit from AAV

Biogen officially washed its hands of AAV-based gene therapy in late September 2025, reallocating resources to "modalities and medicines that have the highest probability of delivering better outcomes for patients," according to Biogen's head of research. The company reassigned most of its AAV gene therapy team to other roles and laid off a small number of employees as part of this strategic shift.

Takeda Abandons Cell Therapy

Takeda announced in October 2025 that it will no longer invest in any cell therapy R&D, after failing to advance its cell therapy pipeline as hoped. Takeda is offloading its cell therapy platform to external partners and cutting 137 jobs in the process. This means Takeda has narrowed its focus to three core modalities—small molecules, biologics and antibody-drug conjugates—redirecting the funds and manpower from cell therapy into those areas.

Pfizer's Gene Therapy Abandonment

Pfizer made waves earlier in 2025 by terminating its only gene therapy product (an AAV-based hemophilia B treatment) just a year after launch, citing "limited interest" from patients and physicians in such one-time therapies. With that decision, Pfizer effectively dumped all its gene therapy work entirely, leaving the pharma giant with no gene therapy assets in either clinical trials or on the market as of 2025.

Roche's Costly Restructuring

Roche has also substantially pulled back: the Swiss company recently undertook a "fundamental reorganization" of its gene therapy unit (Spark Therapeutics, acquired in 2019)—an overhaul that cost Roche a $2.4 billion impairment charge and led to 337 layoffs, with the remaining 310 Spark staff folded into Roche's broader R&D operations.

Vertex Pivots Away from AAV

Vertex Pharmaceuticals likewise announced in May 2025 that it would no longer use AAV viral vectors for delivery in its gene therapy programs, joining the growing list of companies paring down work on AAV-based approaches. While Vertex affirmed it remains committed to "cell and genetic therapies," it pivoted to alternative delivery technologies and techniques (such as ex vivo approaches and gene editing) after concluding AAV wasn't the optimal path forward for its pipeline.

In short, multiple leading pharma companies—including Biogen, Pfizer, Roche, Takeda, and Vertex—have all scaled back or abandoned key gene or cell therapy efforts within the last year. What initially might have looked like a couple of companies' isolated setbacks now appears to be a broader industry recalibration. As a Fierce Biotech analysis noted, Biogen's move "joins the likes of Roche, Takeda, and Vertex, companies that have all shed work in AAV capsid development over the last year," underlining that this is "far from the first" such retreat—and certainly not the last.

Why Companies Are Pulling Back

What is driving this collective pullback from gene and cell therapies? A mix of scientific hurdles, safety setbacks, and commercial realities have tempered the enthusiasm that once surrounded these cutting-edge modalities.

Safety Concerns Cast a Long Shadow

A series of adverse events in gene therapy trials has cast a shadow over the field. For example, Sarepta Therapeutics—a leader in gene therapy for genetic muscle disorders—suffered three patient deaths (due to acute liver failure) in its gene therapy programs by mid-2025, prompting the FDA to impose clinical holds on all of its limb-girdle muscular dystrophy (LGMD) gene therapy trials. Sarepta subsequently discontinued most of its experimental LGMD gene therapies and announced hundreds of layoffs to save costs.

These high-profile safety incidents have shaken investor confidence across the sector. One company's misfortune tends to tarnish perceptions of the entire gene therapy field, making it harder for others to raise capital. Unlike conventional drugs, where a manageable side effect might be addressed by dose adjustments, a single serious adverse event in a gene therapy trial can trigger cascading consequences—clinical holds, regulatory delays, and investor pullback—that can potentially destroy commercial viability of not only that program but also cast doubt on similar approaches.

In addition, the inability to safely re-dose AAV gene therapies (since patients may develop immunity after one dose) and signs of organ toxicity (such as liver damage) at high vector doses have underscored fundamental safety limitations of current gene delivery methods. All of this has made companies and regulators much more cautious. Indeed, some firms like Biogen and Vertex are opting to avoid AAV vectors entirely going forward, seeking safer delivery modalities.

The Economics Don't Add Up

Gene and cell therapies are extraordinarily expensive to develop, manufacture, and administer, which has impaired their commercial viability. AAV gene therapies require complex biomanufacturing and large vector doses, driving up costs. Novartis's Zolgensma, for instance, was launched in 2019 as the world's most expensive treatment (at about $2.1 million for a one-time dose), and its list price has since been hiked to roughly $2.5 million per treatment.

Yet even at such prices, companies have struggled to recoup R&D investments because the patient populations for many rare genetic diseases are small and uptake has been slower than anticipated. Even flagship gene therapies have seen sales plateau or decline: Zolgensma's sales fell 17% year-over-year in Q2 2025 (bringing in only $297 million that quarter), and Novartis acknowledged that finding new patients has become difficult with most eligible infants already treated and newer competing therapies in the mix. The therapy's annual revenue actually peaked at ~$1.37 billion in 2022 and slipped to ~$1.21 billion in 2023-2024, reflecting a flattening demand curve just a few years post-launch.

Pfizer's aforementioned hemophilia B gene therapy (brand name Beqvez), approved in early 2024, encountered tepid market uptake due to multiple factors—"limited interest" from both patients and doctors, concerns over long-term safety, and the existence of effective alternative treatments (like newer antibody and RNA-based therapies). By February 2025, Pfizer pulled the plug on Beqvez's commercialization less than a year after approval, implicitly acknowledging that the cost-benefit proposition wasn't convincing enough for widespread adoption.

The Bluebird Bio Collapse

The collapse of bluebird bio—a pioneer with three FDA-approved gene therapies—is telling. Bluebird struggled to sell its expensive one-time cures (for beta thalassemia, cerebral ALD, and sickle cell) in a marketplace not ready to pay their multimillion-dollar prices. By early 2025, Bluebird's finances were so strained that it agreed to be acquired by private investors for roughly $29-50 million, a pittance compared to its $10 billion+ valuation at its 2018 peak.

In fact, Bluebird's total revenue in 2024 was only $83.8 million, underscoring how far sales fell below expectations for its gene therapy products. This disconnect between ultra-high development costs and limited market return has forced companies to rethink the economics of gene therapy. As one industry commentary noted, payer skepticism is growing—insurers know that serious adverse events or uncertain long-term benefits could tip the risk-benefit balance, making them wary of reimbursing seven-figure therapies without clear value.

Manufacturing Challenges Persist

On the cell therapy side, manufacturing personalized cell products (such as CAR-T cells or other immune cell therapies) remains labor-intensive and costly, and scaling up allogeneic "off-the-shelf" cell therapies has proven more challenging than hoped. These economic and manufacturing challenges mean many cell/gene therapy ventures have burned through cash without achieving sustainable revenue, souring investors on further funding.

Strategic Refocusing

In light of the safety and commercial hurdles, many companies are reassessing where their R&D dollars will have the greatest impact. The recent retrenchments often reflect a pragmatic shift in strategy more than an abandonment of innovation altogether.

Biogen, for example, described its exit from AAV programs as part of "a disciplined approach to capital allocation"—funneling resources to areas with better odds of success. For a neuro-focused company like Biogen, this might mean emphasizing modalities such as antisense oligonucleotides, small molecules, or gene-editing technologies that fit its neuroscience portfolio, rather than classical AAV gene replacement.

Similarly, Takeda's pullback from cell therapy came as it launched a multiyear effort to improve profit margins and R&D productivity. After investing heavily in cell therapy acquisitions (GammaDelta Therapeutics, Adaptate) and partnerships over 2017-2021 with little to show for it, Takeda opted to cut its losses (taking a ¥58 billion (~$394 million) write-down on the cell therapy tech) and double down on core areas like drugs for immunology and oncology that align with its existing strengths.

In other words, these companies are not giving up on serious diseases or on genetic medicine—rather, they are choosing different tools to tackle those diseases. Indeed, Vertex's case is illustrative: even as Vertex dropped AAV delivery, it reaffirmed commitment to "cell and genetic therapies," and is moving forward with other transformative products—for instance, a CRISPR-based ex vivo gene-edited therapy for sickle cell disease (brand name Casgevy) and an islet cell therapy for type 1 diabetes are front-and-center in Vertex's pipeline.

The common thread is that companies are steering away from modalities that proved more problematic (like AAV vectors or certain cell platforms) and refocusing on approaches they believe are more viable (be it gene editing, RNA therapies, antibody-drug conjugates, or traditional biologics).

Financial Fallout: Write-Offs and Restructuring

The financial fallout from these strategic pivots has been significant. As mentioned, Roche swallowed a $2.4 billion impairment charge as it wrote down the value of Spark Therapeutics amid a sweeping restructuring of that gene therapy unit. Takeda is taking a ~$394 million impairment related to its discontinued cell therapy programs.

Biogen's wind-down of early-stage gene therapy projects was accompanied by layoffs (20 researchers affected, according to reports), and Sarepta's safety setbacks led to an announcement of cost cuts targeting $400 million in annual savings (largely through workforce reduction and narrowing of its pipeline).

In the biotech equity markets, pure-play gene therapy companies have fared poorly: bluebird bio's near-bankruptcy and fire-sale price was a stark indicator of how investor sentiment had soured. Other gene therapy startups have struggled to go public or raise new funding, and many are exploring mergers or takeovers as exit strategies.

Signs of Life: Selective Investment Continues

That said, it's not all doom and gloom financially. We are also seeing a flight to quality and a pivot in investment toward next-generation genetic medicines. Rather than abandoning the broader field of genomic medicine, big pharma and investors are selectively backing approaches that address the known pitfalls.

For example, 2025 has seen substantial M&A and licensing deals in the cell and gene space, but notably in areas like gene editing and novel delivery technologies:

• AbbVie paid $2.1 billion to acquire Capstan Therapeutics, a company developing in vivo CAR-T gene therapies (which aim to genetically reprogram patients' T-cells without the need for complex cell manufacturing)
• Eli Lilly struck a $1.3 billion deal with Verve Therapeutics to collaborate on in vivo gene editing for cardiovascular disease—a bold bet on base-editing technology to overcome limitations of traditional gene therapy
• AstraZeneca agreed to spend up to $1 billion on EsoBiotech, a cell therapy player, signaling continued interest in innovative cell-based immunotherapies

Even as some programs falter, others are forging ahead: notably, the first CRISPR-based gene therapy (ex vivo gene-edited cell therapy for sickle cell anemia) is on the cusp of FDA approval in 2025, which could reinvigorate excitement if successful. Meanwhile, regulatory authorities are showing flexibility—the FDA, for instance, approved the first-ever tumor-infiltrating lymphocyte (TIL) cell therapy in early 2024 (Iovance's lifileucel for advanced melanoma), marking a milestone for cell therapies in solid tumors.

Achievements like that underscore that the field is still advancing scientifically, even if the business models require adaptation.

Mixed Signals from the Market

Investors and industry analysts are therefore sending mixed signals. On one hand, broad market enthusiasm for gene/cell therapy has cooled, as seen in the overall decline in biotech funding for these modalities and the hesitant IPO market. On the other hand, targeted investments are flowing into what might be considered "Gene/Cell Therapy 2.0"—ventures aiming to fix the shortcomings (for example, startups engineering new AAV capsids with better tissue targeting and lower immunogenicity, or mRNA and lipid nanoparticle alternatives to viral delivery).

Stephen Majors of the Alliance for Regenerative Medicine remarked in October 2025 that sentiment about the sector had perhaps become "overly negative" and not aligned with the current situation, noting that positive developments (like the diverse range of recent partnerships and acquisitions) are being overlooked.

The reality is nuanced: the commercialization challenges are very real—high prices, manufacturing bottlenecks, insurer skepticism—and they have indeed "hindered broader investor interest" in the short term. But at the same time, regulatory support and scientific breakthroughs continue to provide momentum, suggesting that the field is down but not out.

The Path Forward: Evolution, Not Extinction

Given these developments, are we seeing the end of gene and cell therapy, or simply a course correction? Most experts lean toward the latter interpretation. The consensus in the field is that gene and cell therapies are here to stay, but must evolve to become safer, more cost-effective, and more commercially viable.

A Necessary Reset

The recent retrenchments may actually benefit the sector in the long run by forcing a "reset" on unrealistic expectations and unsustainable approaches. Companies are now laser-focused on solving fundamental issues—for example:

• Designing vectors or delivery systems that can achieve therapeutic benefit with lower doses (improving safety margins)
• Developing better preclinical models to catch toxicity signals earlier
• Innovating manufacturing to scale up therapies at lower cost

The "economics of safety," as some have termed it, will likely dictate the future: gene therapy platforms that can demonstrate a strong safety profile will find it much easier to gain regulatory approval, payer acceptance, and investor funding. Conversely, programs that require massive doses and intense immunosuppression (e.g. some first-generation systemic AAV treatments) may fall by the wayside in favor of more refined strategies.

Patient Need Drives Innovation

It's also important to recognize that patient need continues to drive innovation. There remain many serious diseases with no adequate treatments, and gene and cell therapies still hold promise for cures or long-term remissions in conditions that were previously incurable. The field has chalked up some notable wins—from CAR-T cell therapies curing certain leukemias and lymphomas, to gene therapies like Zolgensma allowing babies with spinal muscular atrophy to achieve developmental milestones never seen before. These successes provide a proof of concept that if the science and economics can be aligned, the impact is life-changing for patients.

Next-Generation Approaches

Moving forward, we can expect to see companies and academic groups exploring:

• Next-generation vectors (e.g. engineered AAVs, alternative viruses, or non-viral nanoparticles)
• Gene-editing techniques (CRISPR, base editing, prime editing)
• Allogeneic or in vivo cell therapy platforms that aim to retain the benefits of gene/cell therapy while mitigating the downsides

In parallel, business models are adjusting—there is growing discussion of innovative payment models for one-time therapies (such as outcomes-based payments or annuities) to help overcome the sticker shock of multimillion-dollar treatments, which could gradually improve the market penetration of gene therapies if implemented.

Conclusion: A Crossroads, Not a Dead End

In summary, as of October 2025 the gene and cell therapy domain finds itself at a crossroads rather than a dead-end. Yes, several big pharma companies have hit the brakes on certain programs, reflecting hard-learned lessons about the current limits of the technology. But this does not equate to a wholesale abandonment of the field.

Instead, the industry is pivoting: shedding or pausing what isn't working, doubling down on what shows promise, and bringing more rigor to how safety and cost-effectiveness are addressed. A headline from the sector's annual "Meeting on the Mesa" conference aptly described the situation as "mixed signals"—there are clear challenges tempering the hype, yet there are also signs of resilience and adaptation.

Whether this is the end of the beginning for gene therapy (a passing of the torch from first-generation efforts to more mature successors) or just a rough patch on the way to eventual success, only time will tell. For now, one thing is evident: the narrative around gene and cell therapies is being rewritten in 2025, with an emphasis on sustainable innovation and realistic expectations.

Far from seeing "the end of gene therapy," we are likely witnessing a necessary evolution toward safer, smarter therapies—a new chapter that is still being authored by scientists, companies, regulators, and patients together.