The recent departure of Peter Marks from the FDA's Center for Biologics Evaluation and Research has introduced uncertainty in the cell and gene therapy sector, where he was a prominent advocate for therapies targeting rare diseases.

Marks was instrumental in establishing regulatory pathways for gene therapies since taking charge of CDER in 2016, including overseeing the approval of the first CAR T cell therapy in 2017.

While industry leaders recognize Marks' significant contributions, they remain optimistic about the future, citing support from his team at CBER and the ongoing demand for innovative therapies.

New FDA Commissioner Marty Makary has announced plans for a conditional approval pathway for therapies aimed at incurable diseases affecting small patient populations, allowing for approvals based on plausible scientific mechanisms rather than traditional randomized trials.

Truist Securities has indicated that the new FDA direction is promising for companies developing drugs for ultra-rare diseases, though there are concerns about the risks of broadening these approvals to larger populations.

Despite a generally optimistic outlook, experts warn that the upcoming months will be crucial as the sector adapts to leadership changes and regulatory shifts.

This shift in FDA policy could revitalize the cell and gene therapy industry, which has seen a dramatic decline in investment—from $8.2 billion in 2021 to just $500 million in 2024—largely due to manufacturing and delivery challenges.

However, the rising costs of cell and gene therapies, such as Lenmeldy and Lyfgenia, present significant challenges for securing insurance coverage and generating revenue for companies.

In the current geopolitical climate, there may be a push for domestic manufacturing, which could alleviate some supply chain issues but might also lead to increased overall costs for therapies.

Concerns linger regarding the impact of global tariffs on the cell and gene therapy industry, which heavily relies on imported materials for manufacturing, potentially driving up costs and limiting patient access to essential therapies.

Additionally, funding cuts at the NIH and academic programs are viewed as detrimental to the cell and gene therapy pipeline, jeopardizing future innovations and breakthroughs in the field.

Investor sentiment has shown signs of improvement, with Jefferies reporting a rise in stock prices for rare disease companies following positive comments from Makary.