The agrifood and health sectors are undergoing rapid, complex transformations. Sustainability and health have switched positions, and digital transformation has gained a resurgence as the future of generative AI is applied to every use-case imaginable. As technologies mature and global priorities shift, innovation leaders face a landscape filled with both promise and uncertainty. At Lux Research, we see three broad forces shaping the shifts in innovation priorities in 2025: Innovating for Impact, Policy Driving Regional Strategy, and Consolidation for Growth. Together, these drivers reveal how companies must position themselves to thrive in a world defined by publicizing existing health crises, policy pivots, and scaling pressures.
Innovating For Impact: Health, Biosynthesis, And Digital Transformation
The innovation story of 2025 is not about chasing trends; it’s about solving systemic innovation challenges in ways that deliver tangible impact and opportunities that start with, or connect to, health.
Metabolic Health
Over one-half billion people live with type 2 diabetes, amplifying risks for other chronic diseases. Lux’s Tech Signal shows that wearables and functional health ingredients are rising. While Ōura’s partnership with Dexcom exemplifies how innovation can close the loop between lifestyle, glucose monitoring, and health outcomes, 23andMe’s collapse demonstrates what happens when hype outpaces clinical utility and business sustainability. The lesson: Real impact requires execution, trust, and integration into healthcare pathways.
Biosynthesis
Biological solutions are driving resilience. Fermelanta’s precision fermentation platform is an achievement in sustainable colorants — an example of bold investment in biosynthesis. Yet, FrieslandCampina’s exit from its biosynthesis projects with Triplebar Bio highlights the brutal economics of scaling bioactive solutions. The lesson: Impact comes from marrying scientific novelty with market and regulatory readiness.
Digital Food Solutions
PepsiCo and Yara’s partnership shows that precision agriculture is more than an efficiency play — it’s a lever for measurable decarbonization across supply chains. Platforms like Tastewise remind us that AI without predictive power risks becoming just another reactive tool. The lesson: Impact comes from delivering measurable ROI, not just data points.
Policy Drives Regional Strategy: From Vision To Market Reality
Policy continues to act as both an enabler and a constraint, reshaping regional opportunities:
- In the Americas, selective emulation of EU policy and fragmented food safety governance highlight both the potential and risks of policy-driven directives, while policy reversals on pollution and uneven regional investment in innovation underscore how fragile such alignment remains.
- In Europe, the easing of GMO restrictions and development of a standardized green claims methodology are moving sustainability from vision to implementation — but geopolitical instability is forcing food chain stability to take precedence over less essential labeling updates.
- In Asia-Pacific, policy alignment around biomanufacturing and food system resilience signals a region ready to implement growth through innovation, especially as the U.S. redistributes its innovation targets.
Policy remains a core driver of strategy. The winners will align regional innovation strategies with shifting regulatory realities to accelerate solution adoption.
Consolidate For Growth: Scaling Under Pressure
As innovation matures, consolidation is reshaping the competitive landscape. The wave of exits and retrenchments — from FrieslandCampina in biosynthesis to multiple consumer genomics firms — shows how fragile early movers can be when scaling stalls. At the same time, partnerships like PepsiCo and Yara’s illustrate how consolidating capabilities can unlock value at scale.
The rise of companies like Fermelanta highlights opportunities created by market exits, provided they can navigate the high-stakes path to commercialization. The market clearly needs successful entrants.
Consolidation goes beyond M&A; it requires channeling resources into areas with long-term growth potential. In 2025, companies must balance bold bets with strategic discipline to ensure growth doesn’t come at the expense of resilience.
Planning For 2026 And Beyond
At Lux Research, our innovation maturity framework shows that success requires more than technological momentum. Market readiness, product-market fit, and production capacity must converge to enable first-of-a-kind investments that consolidate capabilities.
The path forward demands a balance of optimism and caution: optimism to seize opportunities where impact is clear and caution to avoid costly missteps in areas where hype outruns readiness.
Lux Take
Health enhancement and harm reduction continue to drive innovation, but resilience has eclipsed sustainability as the strategic priority shaping the next wave of change. As digital transformation links these forces, companies that align with policy, scale through consolidation, and deliver measurable impact — particularly in health — will lead the market and should thus prioritize resilient innovation strategies that demonstrate clear value to regulators, partners, and end-users.
Curious to learn more? Join us for the our webinar, Navigating Macro-Shifts Across the Agrifood and Health Landscape.