In a state-of-the-art cavern on a moor in Scotland, early biologics researchers inventory some of the natural ingredients they hope will prove to be suitably bioactive: “Fillet of a fenny snake … eye of newt and toe of frog, wool of bat and tongue of dog…” 

As fanciful as Shakespeare’s witches’ recipe seems (and it may be based on long-forgotten folk remedies), humans have been seeking remedies from natural sources for millennia, ranging from willow tree bark as a pain reliever (1500 BCE, aspirin), through foxglove infusions for heart conditions (1700’s, digoxin), to yew tree bark as an anticancer agent (1963, paclitaxel). The search has spread to more exotic sources such as snake venoms (captopril, ACE inhibitor) and marine sponges (cytarabine to treat leukemia). 

In all these cases, the key bioactive ingredient is a well characterized, stable small molecule (molecular weight < 900 Daltons), and these small molecule drugs still represent the majority of the available global pharmacopoeia, in terms of entities and sales figures. But things are changing, and there is increasing interest in, and resources being applied to so-called biologic drugs, which are large, complex molecules produced using living organisms (e.g. monoclonal antibodies, gene therapies and editing and mRNA vaccines). 

Like small molecules, biologic therapies are not new, with notable advances including smallpox vaccine (1796), human blood transfusion (1818), and diphtheria antitoxin (1894); and the pace has accelerated since the creation of the first biologic drug Humulin (recombinant human insulin) in 1982. 

This biologics breakthrough was followed by advances in multiple areas, including monoclonal antibodies (cancer and autoimmune diseases, 1986), antibody-drug conjugates (acute myeloid leukemia, 2000), CAR-T cell therapies (leukemia and lymphoma, 2017), gene therapy (genetic diseases, 2017), mRNA vaccines (COVID, 2020), and CRISPR-Cas9 gene editing (sickle cell disease, 2023). 

In this post we will look at trends in this shifting therapeutic landscape, survey the rapid growth of biologic drugs, and ponder the long-term prognosis for small molecule drugs.

Small molecules vs. biologics trends in the pharmaceutical industry

Market size and sales

The global pharma market was $828B in 2018, split 69% small molecules and 31% biologics. By 2023 it had grown to $1344B with small molecules at 58% and biologics at 42%. Biologics sales are growing three times faster than small molecules, and some analysts predict that biologics will outstrip small molecule sales by 2027. Another prediction is that with a CAGR of 9.1% over 2025 – 2035, biologics sales will reach $1077B in 2035. 

R&D spending

Total global pharmaceutical R&D spending has increased from ca. $140B in 2014 to > $250B in 2024. During this time, there has been a gradual switch from small molecules to biologics: in 2014-16 small molecules consumed 55-60% of the R&D budget, and by 2024 it had declined to 40-45%, with a corresponding growth in biologics R&D. 

New drug approvals

Comparison of new US FDA drug approvals for small molecule vs. biologic drugs is somewhat complicated by the FDA’s decision to move approval of some biologic drugs from the Center for Biologics Evaluation and Research (CBER) to the Center for Drug Evaluation and Research (CDER) in 2003.  It is not always obvious in various publications whether these distinctions are observed when counting new biologic vs. small molecule drugs.

Based on the FDA CDER numbers, small molecules continue to dominate the new novel molecular entity approvals but show a gradual decline from 79% (38/49) in 2019 to 62% (31/50) in 2024.  At the same time the number of novel active substances launched in the US in 2024 shows a 50% biologics 50% small molecules split.

Pros and cons of small molecules vs. biologics-based drugs

Beyond the aspects discussed in the table above, there are a few additional points to consider regarding the comparison of biologics and small molecule drugs:

Further pros of small molecule drugs

Cell membrane penetration

Small molecule drugs have the advantage of easily penetrating cell membranes and affecting intercellular targets such as enzymes and receptors that biologics cannot reach. Their ability to cross the blood-brain barrier is particularly important in CNS and neurology.

Broad therapeutic range

Small molecule drugs have a broad therapeutic range, making them applicable across various disease types, from infections to cancers.

Further pros of biologic drugs

Strong market exclusivity

Biologic drugs offer strong market exclusivity, receiving 12 years before biosimilar versions can be approved, compared to the five years granted to small-molecule drugs before generics can be introduced.

Further cons of small molecule drugs

Resistance

Bacteria, viruses, and cancer cells can develop resistance to small molecule drugs which can diminish their efficacy.

Rapid metabolism

Small molecules can be rapidly metabolized in the liver or kidney, sometimes too quickly for the full therapeutic effect to be realized.

Further cons of biologic drugs

Risk of immune response

Since biologic drugs are derived from proteins, they can trigger immune reactions or neutralizing antibodies, potentially reducing efficacy or introducing side effects.

Market trends for biologic drug development

Biologic drugs have transformed the treatment of chronic conditions such as cancer, autoimmune diseases, and diabetes, with highly targeted, effective treatments. They are leading the way to precision medicine, providing treatments tailored to a patient’s genetic makeup with better therapeutic outcomes and reduced side-effects. 

Innovation in areas including monoclonal antibodies, gene therapies, and therapeutic proteins are leading to the development of treatments to address unmet medical needs, especially in areas such as oncology, neurology, and rare genetic disorders; and advances in biotechnology are paving the way for the development of personalized biologics that can modify disease pathways or even repair defective genes. 

Growing areas of innovation include:

Fusion proteins 

A biotherapeutic that combines two or more protein domains to create a novel molecule with enhanced or targeted therapeutic effects, such as increased half-life, improved targeting, and multi-functional therapy (e.g. aflibercept, to treat wet macular degeneration and metastatic colorectal cancer).

Bispecific antibodies

An immunotherapeutic that binds to two different targets, e.g. a cancer cell and a T cell, to boost the immune system's ability to fight cancer (e.g. blinatumomab, to treat various types of cancer). 

Antisense oligonucleotides 

Antisense oligonucleotide drugs are short, synthetic, single-stranded nucleic acid sequences that bind to complementary RNA sequences, modulating gene expression and protein production to treat diseases, particularly genetic disorders (e.g. eteplirsen, to treat some types of Duchenne muscular dystrophy).

RNA interference (RNAi)

RNAi drugs use small interfering RNA (siRNA) to turn off the production of specific genes that cause or contribute to disease (e.g. inclisiran, a cholesterol-lowering medication that reduces so-called bad cholesterol/LDL levels).

Antibody-drug conjugates

This targeted cancer therapy combines a monoclonal antibody (which binds to specific proteins on cancer cells) with a potent chemotherapy drug via a chemical linker, delivering the drug directly to cancer cells and minimizing damage to healthy tissues (e.g. trastuzumab emtansine, to treat HER2-positive breast cancer). 

CAR-T cell therapy

In CAR-T cell immunotherapy, a patient's own T cells are genetically modified in a lab to recognize and attack cancer cells (e.g. idecabtagene vicleucel, to treat multiple myeloma).

CRISPR-Cas9

This powerful gene-editing technology can be used in drug development and therapies. It allows precision editing of DNA to correct genetic defects, enhance existing treatments, or identify new drug targets. The first CRISPR-based drug, Casgevy, was approved in late 2023 to treat sickle cell disease and transfusion-dependent beta thalassemia. 

Top selling biologics modalities

1. Monoclonal antibodies

In terms of sales by product type, monoclonal antibodies (including immune checkpoint inhibitors) dominate the biologics market, in 2024 recording 56% of global sales. With the widespread persistence of cancer, and autoimmune and infectious diseases, this dominance is likely to continue. The best-selling drug worldwide in 2023 and 2024 was Merck’s anticancer monoclonal antibody Keytruda, which has over 40 indications across multiple cancer types.  

2. Oligopeptides

Perhaps unsurprisingly, the number two best-selling drug in 2024 was Novo’s anti-diabetes/obesity oligopeptide semaglutide, marketed as Ozempic/Wegovy, which saw a 26% increase in sales over 2023. Its future looks bright, with several additional indications being explored, including cardiovascular risk reduction, non-alcoholic steatohepatitis treatment, reduced cravings and addictive behaviors, Alzheimer’s disease and cognitive health, and polycystic ovary syndrome. 

Types of companies involved with biologic drug development

There are four main types of company involved in biologics R&D:

1. Large pharmaceutical companies

Some “big pharma” companies have always been strong in biologics, including:

• Roche/Genentech (monoclonal antibodies – Herceptin, Avastin),
• AbbVie (Humira),
• Amgen (Enbrel, Neulasta). 

Other big pharma companies have evolved from traditional small molecule drug companies to add biologics to their product portfolio, either through acquisition and partnerships (e.g. Pfizer, which acquired Wyeth and co-developed the COVID -19 mRNA vaccine with BioNTech); acquisitions and organic growth (e.g. Novartis, which acquired Chiron and developed monoclonal antibodies and CAR-T therapy); or some other combination (e.g. Eli Lilly moved into monoclonal antibodies, and also partnered with biotechs for COVID-19 antibody treatments; and Merck & Co, which developed Keytruda, a monoclonal antibody for cancer, and is investing in antibody-drug conjugates and vaccines). 

2. Biotechnology companies 

These “biotechs” are smaller than big pharma, and potentially nimbler and more focused on innovation, either via biologic products or novel biotech platforms. Many are start-ups with a longer-term plan to license their product or platform to a larger company, or to be acquired.

Examples include:

• Biogen (neurology),
• Regeneron (monoclonal antibodies and gene therapy),
• Moderna (mRNA-based biologics and vaccines),
• CRISPR Therapeutics (gene editing and cell therapy). 

3. Contract research and manufacturing organizations

These CROs and CMOs support biologics development by providing R&D, clinical trial and manufacturing services.

Examples include:

• Lonza (manufacturing),
• Wuxi Biologics (end-to-end services). 

4. Academic spin-offs and research institutes

These often emerge from academic research with a focus on cutting-edge science such as gene therapy, CAR-T, and synthetic biology.

Examples include:

• Immunocore (T-Cell Receptor biologics),
• Editas Medicine (gene therapy and CRISPR).

Therapeutic areas

In terms of trends in therapeutic areas, product biotechs are strongest in dermatology, GI, ophthalmology, and respiratory diseases, while platform companies focus more on oncology, rare and genetic diseases, infections, and hematology. Neurology, autoimmune and cardiovascular diseases still involve both platform and product biotechs. 

Application of AI/ML

One other growth area for biologic products is the rise of companies using artificial intelligence (AI) and machine learning (ML) in the discovery and development of biologic drugs, especially in areas such as designing antibodies, optimizing protein structures, and predicting immune responses. Many of these companies have collaborations or partnerships with big pharma. 

Are small molecule drugs still viable/relevant compared to biologics?

Small molecule R&D is evolving with novel strategies to target specific mutations or pathways and to approach previously undruggable targets. This research is also enhanced by developments in AI/ML, genomics, computational chemistry, high throughput screening, structure- and fragment-based drug design, and structure- and ligand-based virtual screening at scale. 

Examples include:

KRAS inhibitors

These target specific mutations in the KRAS protein, a frequently mutated oncogene found in various cancers. An example is sotorasib, used to treat non-small cell lung cancer) in adults. 

Protein-protein interaction (PPI) inhibitors

These interfere with PPIs, which are key to several biological processes, including signal transduction, cell proliferation and DNA repair, and are of particular applicability in oncology.

An approved example is venetoclax, used to treat chronic lymphocytic leukemia, small lymphocytic lymphoma, and acute myeloid leukemia.

Covalent inhibitors

These are a subclass of PPI inhibitors that disrupt or modify PPIs by forming a permanent, covalent bond with a target protein. This irreversible binding leads to prolonged inhibition and can overcome some limitations of traditional non-covalent inhibitors.

An example is ibrutinib, used to treat mantle cell lymphoma, chronic lymphocytic leukemia/small lymphocytic lymphoma, Waldenström's macroglobulinemia, marginal zone lymphoma, and chronic graft versus host disease. 

Molecular glues

These are small molecules that enhance or induce PPIs, acting as "adhesives" to bring two proteins together that might not otherwise interact. They can stabilize existing interactions or create new ones and offer a possible route to target previously undruggable proteins.

The three approved molecular glues are thalidomide and two close analogues, and they are used to treat multiple myeloma. There are some 20 other molecular glues in clinical trials.

Proteolysis targeting chimeras (PROTACS)

PROTACs are bifunctional small molecules containing two ligands connected by a linker. One ligand binds to the target protein and the other to an E3 ubiquitin ligase, an enzyme that marks proteins for degradation. Instead of directly inhibiting proteins like traditional drugs, PROTACs induce their degradation by using the cell's natural ubiquitin-proteasome protein degradation system.

They promise advantages including targeting undruggable proteins and overcoming drug resistance. No PROTACs have been approved for clinical use to date, but there are several PROTACs in phase III clinical trials in cancer, autoimmune diseases, and neurological disorders.

Summary

Biologics R&D spending and global sales are growing faster than for small molecule drugs, but the latter continue to dominate new drug approvals. There is continued small molecule R&D focus in oncology, cardiovascular (hypertension and hyperlipidemia), CNS (epilepsy, Parkinson’s and Alzheimer’s disease), anti-infectives, and auto-immune diseases (oral immunomodulatory agents). 

And while attention and resources are shifting to biologics across many therapeutic areas (driven by their targeted mechanisms of action and clinical efficacy, and the promise of precision, personalized treatments), small molecules retain a number of advantages over biologics including their ability to cross the blood-brain barrier in neurological disorders, and their affordability and access, which make them appealing in global health and chronic and orphan disease management. 

References

1. DCAT-VCi: Small-Molecule Drugs: Top 10 Market, Sourcing, and Supply-Chain Trends

2. Barry Elad, SCI-TECH: Biologics Statistics and Facts (2025)

3. futuremarketinginsights.com: Biologics Market Analysis – Growth & Forecast 2025-2035

4. fda.gov: Transfer of Therapeutic Biological Products to the Center for Drug Evaluation and Research

5. CDER can approve monoclonal antibodies for in vivo use; proteins intended for therapeutic use, but not vaccines and blood products; immunomodulator proteins or peptides; and growth factors, cytokines, and monoclonal antibodies intended to mobilize, stimulate, decrease or otherwise alter the production of cells in vivo. CBER retains approval responsibilities for cellular products; gene therapy products; vaccines and vaccine-associated products; allergenic extracts for diagnosis and treatment of allergic diseases and allergen patch tests; antitoxins, antivenins, and venoms; and blood, blood components, and plasma-derived products.

6. Vinicius Teixeira,  Shaima Qunies, drughunter.com: 2024 Novel Small Molecule FDA Drug Approvals

7. iqvia.com: Global Trends in R&D 2025

8. Deepa Pandey, precedenceresearch.com: Biologics Market Size, Share, and Trends 2025 to 2034

9. Tristan Manalac, biospace.com: 10 Best-Selling Drugs of 2024 Rake in Billions Amid Exclusivity Threats