Visiongain’s recently published in-depth study shows that the global market for pharmaceutical contract manufacturing is experiencing significant growth, which is driven by several pivotal factors. It states that “Strategic Management and Innovation are the Key to Overcoming Challenges”.

Visiongain estimates the global pharmaceutical contract manufacturing market at US$159.6 billion in 2024, with a projected CAGR of 11.5% during the forecast period 2024-2034.

Read more here; Pharmaceutical Contract Manufacturing Market Report 2024-2034

What are the Current Market Drivers?

Key drivers include the expiration of patents, which is increasing the demand for generic drugs, and a growing focus on core competencies coupled with substantial research funding. Despite this positive momentum, the market faces notable challenges. These include constraints in capacity utilisation, the traditional practices of Contract Manufacturing Organisations (CMOs), and stringent regulatory requirements that govern their operations.

These factors collectively influence the market’s trajectory, shaping its growth and presenting challenges that require strategic management to ensure ongoing development and innovation in pharmaceutical manufacturing and packaging. Addressing capacity constraints, modernising CMO operations, and navigating complex regulatory landscapes are crucial for overcoming these challenges and fostering a supportive environment for industry advancement.

By leveraging core competencies and investing in research, stakeholders can seize emerging opportunities and drive progress in drug manufacturing. This approach not only enhances the industry’s ability to adapt to evolving regulatory standards but also contributes to sustained growth and innovation in the pharmaceutical sector.

High Cost of In-house Drug Development is Likely to Propel the Market Growth

Especially for pharmaceutical companies that are small and medium-sized, the drug discovery and development process is both time-intensive and expensive. In order to address these obstacles, an increasing number of pharmaceutical companies are utilising Contract Development and Manufacturing Organisations (CDMOs) as a more cost-effective and efficient solution.

The drug development process requires adherence to stringent U.S. FDA guidelines and maintaining rigorous quality and standards, which significantly inflates the cost of in-house drug development and manufacturing. The escalating costs associated with drug discovery, pre-clinical development, clinical trials, capital investment, funding shortages, and high failure rates of drugs during human trials are major factors driving this shift.

Outsourcing drug development to CDMOs allows pharmaceutical companies to manage expenses more effectively while leveraging specialised expertise and infrastructure. This strategic approach helps companies navigate the complexities of regulatory compliance, reduces in-house development costs, and enhances overall operational efficiency. Consequently, pharmaceutical companies are increasingly utilising contract manufacturing organisations (CMOs) to optimise their drug development processes and mitigate the financial burdens associated with introducing new medicines to the market.

Rising Demand for Specialty and Generic Medicines

The growing demand for both specialty and generic medicines is a major driver of the pharmaceutical contract manufacturing market. The increasing prevalence of chronic diseases, an ageing global population, and the expiration of patents on numerous high-profile medicines are the primary factors driving this surge. In response, pharmaceutical companies are increasingly seeking cost-effective production solutions and accelerated time-to-market, leading them to partner with Contract Manufacturing Organisations (CMOs) for their specialised capabilities and scalable operations.

Recent industry developments underscore this trend. For instance, Akums Drugs and Pharmaceuticals Ltd. has recently introduced Lobeglitazone, a medication for type 2 diabetes, highlighting the growing demand for specialised treatments. Similarly, Aurigene Pharmaceutical Services has announced plans to build a cutting-edge facility dedicated to the production of therapeutic proteins and antibodies, signaling a significant shift towards complex biologics and specialty pharmaceuticals.

These examples reflect a broader movement within the industry towards outsourcing to CMOs, driven by the need for efficiency and expertise in producing innovative and specialised drug products.

Where are the Market Opportunities?

Increasing Demand for Biologics and Biosimilars

The increasing demand for biologics and biosimilars represents a substantial growth opportunity for the pharmaceutical contract manufacturing market. Biologics, which encompass a diverse range of products such as vaccines, gene therapies, and monoclonal antibodies, are becoming a central focus for pharmaceutical companies due to their ability to address complex diseases like cancer, rheumatoid arthritis, and multiple sclerosis.

Given the complexity of biologics, which necessitates advanced manufacturing processes, many pharmaceutical companies are opting to outsource production to specialised Contract Manufacturing Organisations (CMOs) with the required expertise and infrastructure. The demand for these complex therapies is being further fuelled by the ongoing advancements in biotechnology and the increasing prevalence of chronic diseases.

Biosimilars, which are extremely similar to biologic products that have already been approved, are gaining momentum as the patents on numerous biologic drugs expire. This scenario presents a significant market opportunity for CMOs to engage in the production of cost-effective biosimilars. The global biosimilars market is anticipated to experience considerable growth, fueled by the need for affordable biologic therapies and supportive regulatory environments in regions such as Europe and Asia.

Recent industry developments underscore the sector’s emphasis on biologics and biosimilars. For instance, Catalent’s 2023 acquisition of Bone Therapeutics cell therapy manufacturing subsidiary highlights a strategic investment in cell and gene therapy capabilities, aimed at expanding Catalent’s ability to meet the increasing demand for advanced biologics manufacturing.

Emerging Markets to Offer Lucrative Growth Prospects

As a result of their skilled personnel and cost advantages, emerging countries are increasingly serving as important centres for bioprocess outsourcing. The expansion of pharmaceutical contract development and manufacturing services in these emerging markets is being further advanced by the rising interest of pharmaceutical companies in outsourcing drug discovery, which is being driven by escalating R&D costs, dwindling antibiotic pipelines, and increasing vaccine demands. Additionally, the low cost of production and labour in these regions, as well as the adoption of sophisticated manufacturing technologies, are incentivising market players to invest in developing markets such as Asia Pacific during the forecast period.

This trajectory of development is being spearheaded by nations such as China and India. Both nations present several compelling advantages that attract investments in pharmaceutical contract manufacturing. These benefits include low production costs, a large pool of skilled labor, and strategic proximity to expanding pharmaceutical markets in Asia and Africa. India, with its established proficiency in generics production, and China, with its significant investments in biotechnology and active pharmaceutical ingredients (API) manufacturing, are particularly notable. Moreover, China’s government policies aimed at boosting domestic pharmaceutical production further enhance its attractiveness as a manufacturing hub.

As a result, India and China are expected to provide substantial opportunities for growth in the pharmaceutical contract manufacturing and development market in the coming years.

Competitive Landscape

The major players operating in the pharmaceutical contract manufacturing market are Lonza, Catalent, Inc., Recipharm AB, AbbVie Inc., Thermo Fisher Scientific Inc., Siegfried Holding AG, Evonik Industries AG, Boehringer Ingelheim International GmbH, Piramal Pharma Solutions, Samsung Biologics, WuXi AppTec, FUJIFILM Diosynth Biotechnologies, ICON plc, Abnova Corporation, Vetter Pharma, Aenova Group, Almac Group, Nipro Pharma Corporation, Jubilant Pharmova Limited, Grifols, S.A., Charles River Laboratories, IQVIA Inc., Baxter, Curia Global, Inc., and Lannett. These major players operating in this market have adopted various strategies comprising M&A, investment in R&D, collaborations, partnerships, regional business expansion, and new product launch.

Recent Developments

• On 16th July 2024, Catalent, Inc. completed expansion of its clinical supply facility in Schorndorf, Germany. The Schorndorf site, Catalent’s flagship European facility, provides comprehensive clinical supply services, including packaging, storage and distribution.
• On 20th March 2024, Lonza signed an agreement to acquire the Genentech large-scale biologics manufacturing site in Vacaville, California (US) from Roche for US$1.2 billion.
  
  

Visiongain has published a new report entitled Pharmaceutical Contract Manufacturing Market Report 2024-2034

Forecasts by Services (Pharmaceutical Manufacturing Services, Drug Development Services, Biologics Manufacturing Services), by Drug Type (Branded, Generics), by End-users (Big Pharmaceutical Companies, Small & Medium-sized Pharmaceutical Companies, Generic Pharmaceutical Companies, Other), by Scale of Operation (Clinical, Commercial) AND Regional and Leading National Market Analysis PLUS Analysis of Leading Companies.

How will this Report Benefit you?

Visiongain’s 349-page report provides 143 tables and 198 charts/graphs. Our new study is suitable for anyone requiring commercial, in-depth analyses for the pharmaceutical contract manufacturing market, along with detailed segment analysis in the market. Our new study will help you evaluate the overall global and regional market for Pharmaceutical Contract Manufacturing. Get financial analysis of the overall market and different segments including type, process, upstream, downstream, and company size and capture higher market share. We believe that there are strong opportunities in this fast-growing pharmaceutical contract manufacturing market. See how to use the existing and upcoming opportunities in this market to gain revenue benefits in the near future. Moreover, the report will help you to improve your strategic decision-making, allowing you to frame growth strategies, reinforce the analysis of other market players, and maximise the productivity of the company.

Notes for Editors

If you are interested in a more detailed overview of this report, please send an e-mail to contactus@visiongain.com or call +44 207 336 6100.

About Visiongain

Visiongain is the go-to source for independent, data-driven insights, trusted by some of the world’s most esteemed companies and thought leaders. For decades, Visiongain’s analysts have provided original, high-quality research, helping businesses navigate complex markets with confidence.

The Visiongain Research Library offers more than 5,000 market reports, spanning many industries such as healthcare & pharmaceuticals, automotive & transportation, AI & cyber, aerospace & defence, energy & resources, food & agriculture, and more. Robust proprietary methodologies, including primary research methods ensure that Visiongain delivers reliable forecasts and predictions that businesses rely on.