As major players adjust their gene therapy pipelines, AAV-based approaches are under renewed scrutiny — not because they’ve failed, but because the bar for clinical, regulatory, and commercial success has risen. The industry is now navigating a more disciplined phase of development, where the promise of gene therapy persists, but demands sharper focus and smarter execution.
A Moment of Reassessment
In April 2025, Vertex Pharmaceuticals announced it would discontinue all internal research related to adeno-associated virus (AAV) gene therapies, marking a pivotal moment in the evolution of the gene therapy landscape. Once considered the gold standard for in vivo genetic delivery, AAV is now under heightened scrutiny, not only for scientific and safety limitations but also for commercial feasibility in a more disciplined post-hype environment.
Vertex's move is part of a larger trend among top-tier biopharmaceutical companies reevaluating the role of AAV in their R&D pipelines. Yet these withdrawals should not be mistaken for a wholesale rejection of the modality. Instead, they reflect a necessary recalibration — an industry-wide shift toward prioritizing programs with clearer value propositions, greater manufacturability, and more favorable risk–benefit profiles.
Strategic Shifts from Big Pharma
A wave of high-profile decisions from major pharmaceutical companies has signaled a significant strategic realignment in gene therapy development, particularly around AAV-based programs. While headlines might suggest retrenchment, a closer look reveals a more nuanced reality: companies are narrowing their focus, reallocating resources, and concentrating efforts where the scientific, regulatory, and commercial outlooks are more favorable.
Vertex Pharmaceuticals exemplified this shift by discontinuing its internal AAV vector research and ending partnerships with both Verve Therapeutics (gene editing for cardiovascular disease) and Entrada Therapeutics (tRNA-based therapies). According to company leadership, the decision was part of a broader move to concentrate on near-term value creation and late-stage programs with clearer paths to market, such as cystic fibrosis and sickle cell disease therapies.
Pfizer has also opted to phase out its AAV gene therapy efforts entirely, including the hemophilia B treatment Beqvez (fidanacogene elaparvovec), which was once among the most advanced AAV programs in development. Despite receiving European marketing authorization in 2023, Pfizer ultimately decided to exit the space, citing limited commercial traction and evolving strategic priorities.
At Roche, the recalibration came in the form of a dramatic $2.4 billion impairment charge on Spark Therapeutics, the AAV-focused gene therapy developer it acquired in 2019. While Spark retains promising assets, the write-down reflects the challenges in translating early innovation into robust, commercially successful therapies across broader indications.
Takeda has joined the trend, streamlining its early-stage gene therapy and rare hematology pipeline and implementing layoffs that affected R&D teams focused on AAV research. Like others, Takeda has emphasized the need to concentrate investment on programs with strong alignment to its core business and a clearer path to clinical and commercial success.
Even Sarepta Therapeutics, a gene therapy pioneer, is facing challenges. The company is working closely with regulators following the death of a patient treated with its AAV-based Duchenne muscular dystrophy therapy, Elevidys. Clinical trials in Europe have been paused pending further safety evaluations, underscoring the regulatory sensitivity surrounding AAV trials. However, Sarepta has not abandoned the program and continues to emphasize patient safety, transparency, and engagement with health authorities as part of its ongoing development.
Taken together, these strategic moves suggest not a loss of faith in gene therapy or AAV, but a refocusing on programs with greater potential for scalability, manufacturability, and patient impact. As the field matures, the emphasis is shifting from proof-of-concept to sustainable execution.
At the same time, not all major players are pulling back. Some are doubling down — building on past successes and refining their AAV strategies to align with more targeted therapeutic areas. Novartis continues to support Zolgensma, its AAV9-based gene therapy for spinal muscular atrophy (SMA), which remains one of the most commercially successful gene therapies to date and has treated thousands of patients globally. Roche, despite its Spark impairment, is still advancing ocular and central nervous system (CNS) gene therapy programs, particularly those leveraging Spark’s established manufacturing and regulatory infrastructure. Ultragenyx is progressing with UX111 for Sanfilippo syndrome and has partnered with Solid Biosciences to expand its neuromuscular pipeline. Meanwhile, Biogen is maintaining its investment in AAV through its gene therapy facility in North Carolina and continues to explore CNS-directed AAV programs. These efforts highlight that while some organizations are narrowing their pipelines, others are evolving them — focusing on indications with validated biology, more predictable delivery, and tighter clinical endpoints.
Underlying Scientific and Technical Realities
The renewed scrutiny of AAV-based gene therapies is not driven by market dynamics alone. It is equally rooted in the biological, technical, and logistical complexities that continue to challenge the scalability and reliability of this delivery modality. While many of these challenges were known, recent clinical and commercial experiences have underscored their importance, pushing the industry to refine its approach.
Immunogenicity
One of the most persistent and difficult challenges in AAV-based therapies is immunogenicity. A significant percentage of the population carries preexisting neutralizing antibodies to AAV — either from natural exposure or prior gene therapy — which can block therapeutic efficacy and exclude patients from trials. Even when initial delivery succeeds, the immune system may mount a delayed response that precludes redosing, effectively limiting most AAV therapies to a single lifetime administration.
More serious immune-related toxicities have also emerged in recent trials. These include liver inflammation, thrombocytopenia, and, in rare cases, fatal outcomes due to high-dose systemic administration. These risks have prompted regulatory holds and more cautious trial designs, and they remain a central area of concern for developers and regulators alike.
Durability and Dosing
Early gene therapy programs often marketed the idea of a “one-and-done” cure. However, real-world results have been mixed. In some cases — especially systemic indications — AAV therapies have shown short-lived or declining protein expression over time. This variability raises concerns not only about therapeutic durability but also about how to price and position these treatments when long-term benefit cannot be guaranteed.
Moreover, the inability to redose safely reinforces the need for durable outcomes from the first administration. In indications like hemophilia, where precise factor levels are critical, any decline in expression can diminish clinical utility and complicate payer negotiations.
Manufacturing Hurdles
Manufacturing remains one of the largest bottlenecks in AAV gene therapy development. AAV vectors are biologically complex and require multi-step production and purification processes that are difficult to scale efficiently. Batch-to-batch variability, low vector yields, and the need for ultra-pure product to meet regulatory standards all contribute to high cost of goods and long production timelines.
Furthermore, there is no universal standard for analytical assays or quality control, which complicates comparability studies and regulatory submissions. Despite these challenges, CDMOs and platform developers are making substantial progress — including innovations in producer cell lines, scalable suspension-based systems, and high-throughput analytical tools. These advances are helping to mitigate manufacturing risk and support the growing demand for platform flexibility.
Delivery Trade-Offs
The method of delivery significantly impacts both the safety and efficacy of AAV-based therapies. Systemic delivery, while necessary for diseases requiring broad tissue distribution (e.g., muscular or metabolic disorders), carries higher immunological risk and has been implicated in some of the most serious adverse events. In contrast, localized delivery, such as subretinal injections for ocular diseases or intrathecal administration for CNS disorders, offers more controlled exposure and fewer systemic effects.
To address current delivery limitations, researchers are actively developing next-generation AAV capsids engineered for improved tissue targeting, lower immunogenicity, and the potential for redosing. These efforts are already yielding promising candidates in preclinical studies and early-phase trials, laying the groundwork for safer and more versatile AAV applications.
A More Disciplined Commercial and Regulatory Landscape
As gene therapy transitions from scientific breakthrough to commercial product, the economic and regulatory calculus has grown more stringent. AAV-based therapies now face a marketplace where clinical ambition must align with new financial realities and regulatory rigor. Developers are discovering that even groundbreaking science must pass the tests of durability, scalability, and payer acceptance.
The Cost–Outcome Mismatch
One of the most pressing concerns is the disconnect between cost and outcome, especially for AAV therapies targeting ultra-rare diseases. With price tags that often exceed $2 million per dose, payers are justifiably demanding clear, long-term evidence of benefit. But the inability to redose, combined with variability in treatment durability, has made it difficult for some programs to meet these expectations, especially when compared with chronic treatments that deliver consistent effects over time.
As a result, reimbursement decisions have become more conservative, with greater reliance on outcomes-based pricing agreements, postmarketing commitments, and long-term follow-up requirements. This environment poses particular challenges for emerging biotechs trying to advance AAV programs without established commercial infrastructure.
Increased Regulatory Scrutiny
Safety concerns — particularly those related to high-dose systemic AAV administration — have triggered a wave of clinical holds and heightened oversight. Recent adverse events, including treatment-related liver failure and immune complications, have led agencies such as the U.S. Food and Drug Administration (FDA) and the European Medicines Agency (EMA) to take a more cautious stance, requiring additional safety monitoring, tighter inclusion criteria, and more robust preclinical validation.
For example, the EMA temporarily paused clinical trials of Sarepta’s Elevidys following the death of a patient with Duchenne muscular dystrophy, pending further investigation.
These responses underscore the regulators’ evolving mandate — not to hinder progress, but to ensure that benefit–risk profiles are thoroughly validated before approval or widespread use.
Payers Raising the Bar
Beyond regulators, payers have become key gatekeepers. They are increasingly scrutinizing clinical trial design, patient selection, and endpoints, looking not only at initial efficacy but also at the sustainability of therapeutic impact. Real-world durability data and health economic models are playing a growing role in coverage decisions.
In this environment, programs with inconsistent outcomes or unclear mechanisms of action face an uphill battle, even if the underlying science is promising. Developers must now plan for commercial viability as early as they plan for IND-enabling studies.
Room for Success Remains
Despite the increased discipline, successful AAV-based products have made it to market, showing that when programs are well-constructed and targeted, regulatory and commercial success is achievable.
Luxturna (Spark/Roche) for inherited retinal disease remains a model for localized, durable gene therapy with clear endpoints.
Zolgensma (Novartis) for spinal muscular atrophy, despite pricing debates, has gained widespread adoption and changed the treatment paradigm.
Other niche therapies continue to emerge, especially in ophthalmology, CNS, and hematology, where targeted delivery and well-characterized disease biology offer a clearer path.
The lesson from these successes is clear: precision, planning, and partnership matter. AAV gene therapy remains viable, but only for those programs that can navigate today’s more exacting expectations.
Investor Sentiment after the Hype Cycle
Few areas of biotech have ridden the highs and lows of investor enthusiasm like gene therapy. In the wake of the first approvals and multibillion-dollar M&A deals, the early 2020s saw a flood of capital into companies developing AAV-based and other gene delivery technologies. But that exuberance has cooled. According to recent estimates, gene therapy investment dropped from $8.2 billion in 2021 to just $1.4 billion in 2024, reflecting both a broader biotech market correction and mounting questions about scalability and return on investment.
Nonetheless, the decline in funding does not signal the end of investor interest. Instead, it represents the arrival of a more mature, evidence-driven mindset. Gone are the days when early-stage programs could raise hundreds of millions on speculative pipelines alone. Today’s backers are looking for proof of platform versatility, clear regulatory strategies, and real-world data on safety and durability.
Companies that meet these benchmarks are still raising capital — often doing so at premium valuations. Differentiated AAV capsid platforms, tunable expression systems, redosable vectors, and modular delivery strategies remain highly attractive, particularly when backed by robust preclinical data or early clinical readouts. Investors are also showing a growing preference for indications with large markets or strong orphan incentives, especially when supported by measurable endpoints and rapid development pathways.
This trend has also elevated the role of CDMOs and technology platform providers, who are seen as essential partners in de-risking development. By offering end-to-end capabilities — from vector design and GMP manufacturing to analytical testing and regulatory support — CDMOs help emerging biotechs bridge the gap between discovery and IND readiness. Their expertise in scalable production and regulatory compliance is increasingly viewed as a critical enabler of success.
In a more selective funding environment, those who can offer technical depth, operational agility, and credibility with regulators have a distinct edge. The shift may be painful for some early-stage players, but it is ultimately setting the stage for a more stable and sustainable phase of gene therapy investment — one built on evidence, not just excitement.
Is AAV Still Viable?
Despite recent strategic pivots, AAV remains the most clinically validated and widely used vector for in vivo gene therapy. The shift in industry sentiment does not suggest obsolescence; it points instead to a more refined understanding of when, where, and how to deploy AAV most effectively.
In certain therapeutic areas, AAV continues to offer clear advantages. Its ability to achieve long-lasting transgene expression in non-dividing cells, combined with a relatively well-characterized safety profile, makes it particularly well-suited for CNS, ocular, and liver-directed applications. These tissues are more immunoprivileged and accessible via local or targeted delivery routes, helping to mitigate many of the challenges seen with systemic administration.
Meanwhile, researchers and developers are making meaningful progress on some of AAV’s historical limitations. Emerging technologies aim to enable redosing by cloaking vectors from the immune system or using novel serotypes that evade preexisting antibodies. Other advances include capsid engineering for improved tissue specificity and modular transgene platforms that allow for more precise control of expression levels.
CDMOs and vector platform developers are playing a pivotal role in this evolution. These organizations are not only scaling up manufacturing to meet demand but are also at the forefront of technical innovation — optimizing production processes, improving vector purity and potency, and supporting the development of next-generation constructs with enhanced clinical profiles. Their contributions are helping the field transition from experimental therapy to reproducible, regulatory-grade medicine.
The takeaway is clear: AAV remains a vital component of the gene therapy toolbox. The current environment doesn’t spell the end of the modality but instead invites greater strategic focus. When used in the right context, and with the right delivery strategy, AAV continues to offer a compelling path for durable, transformative treatments.
Where AAV Still Wins –Viable Targets and Technical Strengths
Ophthalmology: Subretinal delivery avoids systemic exposure and enables durable effect with small doses (e.g., Luxturna).
Neurology: Intrathecal and intraparenchymal delivery methods reduce immunogenicity and enable targeted CNS therapies.
Hepatic Targets: Liver-directed gene transfer is well-characterized and benefits from strong preclinical models.
Vector Versatility: Dozens of natural and synthetic AAV serotypes allow for tuning tropism, expression, and payload compatibility.
CDMO Innovation: Leaders in AAV manufacturing are reducing batch variability, improving yield, and driving down cost per dose, making AAV more viable for broader indications.
Platform Flexibility is the Future
While AAV-based gene therapy faces a more selective future, the overall field of genetic medicine continues to expand, driven by innovation across multiple platforms and delivery technologies. Rather than signaling retreat, the current shift represents the maturation of the sector, one that is increasingly platform-flexible, indication-driven, and strategically diversified.
CRISPR and base editing technologies are enabling precise genomic interventions with growing traction in clinical trials, especially for hematologic disorders and genetic diseases with well-defined mutations. Companies are also exploring prime editing and programmable epigenetic tools, offering new avenues for durable gene correction without double-stranded DNA breaks.
Simultaneously, the rise of mRNA therapies and lipid nanoparticle (LNP) delivery systems, fueled in part by the success of mRNA COVID-19 vaccines, has opened up alternative routes for transient gene expression and protein replacement. These platforms are particularly attractive for applications requiring repeated dosing or immune system modulation, areas where AAV may be less suited.
Lentiviral vectors, long utilized in ex vivo therapies like CAR-T and stem cell modification, are now also being investigated for in vivo gene delivery thanks to advances in pseudotyping and vector engineering. Lentivirus offers potential benefits in terms of payload size, stable gene integration, and reduced immunogenicity, especially for certain tissues and long-term correction scenarios.
Ex vivo cell and gene therapies, including CAR-T, hematopoietic stem cell gene modification, and engineered immune cells, have also carved out a distinct space in oncology and rare disease. These therapies benefit from tight manufacturing controls and personalized dosing strategies, though they bring their own logistical and economic complexities.
As the field continues to evolve, developers are increasingly pursuing modality-agnostic strategies — focusing first on the biology of the disease and then selecting the best tool for delivery, editing, or expression. In some cases, AAV, LNPs, and CRISPR are used in complementary ways, even within the same development pipeline.
This trend is shaping a more synergistic, integrated landscape where success depends not on allegiance to a single platform but on the ability to combine tools, tailor approaches, and execute with precision across scientific, regulatory, and manufacturing dimensions. For innovators and partners alike, platform flexibility is no longer a luxury — it’s a competitive necessity.
Conclusion: From Overpromise to Overdeliver
Gene therapy — and AAV-based approaches in particular — may no longer sit atop the biotech hype cycle, but that is not cause for alarm. Rather than marking the end of an era, the current moment signals the start of a smarter, more resilient phase of development that rewards scientific rigor, strategic discipline, and executional excellence.
The past decade brought extraordinary breakthroughs but also revealed the complexity of translating gene therapy from concept to clinic to commercial success. As a result, the field is now right-sizing its expectations — shifting focus from bold promises of curative miracles to programs that can reliably deliver meaningful, durable outcomes for patients.
AAV remains a foundational platform within this future, especially in areas where its properties align with the biological and clinical context. With continued innovation in delivery, immunology, and manufacturing — and with experienced CDMOs and technology partners helping de-risk development — the modality still holds critical potential for long-term success.
