The Pharmaceutical Contract Development and Manufacturing Market is expected to grow at a CAGR of 7.5% from 2022 to 2029 to reach $226.35 billion by 2029. Pharma contract manufacturing companies offer various services to drug companies. The growth of this market is mainly driven by the complex manufacturing requirements of the pharmaceutical industry, increasing investments in pharmaceutical R&D, the pharmaceutical industry’s growing inclination towards cutting-edge technologies, patent expiration, and the coronavirus pandemic. In addition, the growing demand for cell and gene therapies and personalized medicines and the growth of the High-potency Active Pharmaceutical Ingredients (HPAPI) and Antibody-drug Conjugates (ADC) markets is expected to offer significant opportunities for the players operating in this market. However, the lack of skilled professionals and the introduction of serialization are key factors expected to hinder the growth of the pharmaceutical contract development and manufacturing market.
COVID-19 Impact Assessment
The recent outbreak of COVID-19 impacted various healthcare markets either positively or negatively. The pharmaceutical contract development and manufacturing industry was positively impacted due to the COVID-19 pandemic. The outbreak catalyzed the demand for pharmaceuticals and stirred the development of coronavirus-related vaccines, antiviral vaccines, antibody therapies, and various pharmaceutical products, encouraging pharmaceutical companies to hire contract development and manufacturing organizations for pharmaceutical drug development & manufacturing to ensure business sustainability.
Most pharmaceutical companies, contract research organizations, and research institutes are working together to translate research into effective pharmaceutical products. For instance, in August 2020, Catalent Inc. (U.S.) signed an agreement with AstraZeneca PLC (U.K.) to expand manufacturing support for the University of Oxford’s adenovirus vector-based COVID-19 vaccine AZD1222 at the manufacturing facility located in Harmans, Maryland. Also, in September 2020, Thermo Fisher Scientific Inc. (U.S.) partnered with Inovio Pharmaceuticals, Inc. (U.S.) to manufacture INOVIO's DNA COVID-19 vaccine candidate INO-4800 and enhance the commercial production of INO-4800.
Further, many vaccines are still under development, while several COVID vaccines are currently available on the market. According to the World Health Organization (WHO), as of 18th March 2022, 149 vaccines were in clinical development, 195 vaccines were in pre-clinical development, and 37 vaccines have been authorized across several countries. Thus, due to the high demand for effective drugs to treat COVID-19, the production of chloroquine, vaccines, antibodies, and other drugs is expected to increase globally, supporting the growth of the CDMOs market in the coming years.
Click here to: Get Free Sample Pages of this Report
Growth of the High-potency Active Pharmaceutical Ingredients (HPAPI) and Antibody-drug Conjugates (ADC) Markets to Provide Lucrative Opportunities
The production of High-potency Active Pharmaceutical Ingredients (HPAPIs) requires manufacturing under high-containment conditions. Further, specialized operator training based on occupational exposure limits is vital due to the high levels of containment required for HPAPIs manufacturing. HPAPIs comprise anti-cancer therapies, including Antibody-drug Conjugates (ADCs), which contain small-molecule cytotoxic compounds or other potent compounds, such as hormonal therapies. In recent years, the oncology drugs market has grown rapidly with increased cancer cases and technological advances enabling the development of safe and effective medicines. Technological advancements allow compounds to be more selective towards the target of interest, thereby reducing dosing frequencies, and this growing need for potent, targeted therapies has resulted in an increasing interest in highly potent New Chemical Entities (NCEs). HPAPIs are designed to achieve pharmacological activity with very small amounts of the active ingredient, reduced side effects, and minimal damage to the tissues surrounding the diseased area. The oncology drugs market has witnessed increased investments in high-potency manufacturing.
The growing demand for HPAPIs is an attractive investment area for numerous CDMOs. In addition to this, Antibody-drug Conjugates (ADCs) are another segment of targeted therapies that has secured considerable investments. For instance, in February 2022, Piramal Enterprises Ltd. (India) invested $74.56 million in expanding antibody-drug conjugate (ADC) production capabilities by constructing a new facility in Grangemouth, Scotland (U.K.). The facility will be operational by the third quarter of 2023. Similarly, in July 2021, Lonza Group AG (Switzerland) invested $21.88 million in its API manufacturing center in Nansha (China). This investment was aimed at setting-up laboratories for the development and manufacture of highly potent APIs. These laboratories are expected to go online between the first and third quarters of 2022.
Growing Consolidation of CDMO Players—an Ongoing Trend in the Pharmaceutical Contract Development & Manufacturing Market
The pharmaceutical contract development and manufacturing market is witnessing rapid growth due to the growing pressure on leading industry players, the developmental process challenges faced by the pharmaceutical industry, the growing number of patents expiring, the rising prevalence of chronic diseases, and increasing R&D costs.
With developments in the pharmaceutical industry, leading CDMOs aim to seek and bridge capability gaps. CDMOs offering multiple services increase convenience, save time, and enhance cost efficiency as pharmaceutical companies have to only deal with a single entity. The relationship also creates opportunities for the pharmaceutical CDMO to sell more services to the same customer and lock in products at earlier stages of their life cycles.
Industry developments, especially mergers & acquisitions, have increased considerably since 2012 as market players are focused on strategically expanding their geographic presence, manufacturing capabilities, and service offerings. Contract development and manufacturing companies have been pursuing acquisitions to enhance their technical abilities, capacities, scale, flexibility, and market penetration to compete for the industry’s most valuable contracts. Some of the major acquisitions in the pharmaceutical contract development and manufacturing space are:
- In February 2022, Recipharm AB (Sweden) acquired Arranta Bio (U.S.) to add scientifically differentiated contract development and manufacturing services for ATMPs in its service offerings and develop a strong presence in the U.S.
- In February 2021, Charles River Laboratories International, Inc. (U.S.) acquired Cognate BioServices, Inc. (U.S.) for $875 million to add cell and gene therapy CDMO capabilities.
- In February 2020, Catalent Inc. (U.S.) acquired MaSTherCell Global Inc. (Belgium) for $315 million to leverage MaSTherCell’s unique portfolio of capabilities, technologies, and related analytical services to lead the industry with its cell & gene therapy platforms.
Key Findings in the Pharmaceutical Contract Development and Manufacturing Market Study:
Pharmaceutical Manufacturing Services Accounted for a Larger Proportion of Revenue Compared to Other Services
The large share of this segment is mainly attributed to pharmaceutical companies’ growing need to reduce manufacturing costs as the development of new drugs requires huge initial investments. Apart from this, the use of advanced technologies and skills for manufacturing, the requirement for high-quality bulk manufacturing, and the growing demand for generic drugs are the factors propelling the growth of this segment.
The Parenteral/Injectable Manufacturing Services Subsegment to Account for the Largest Share of the Pharmaceutical FDF Contract Manufacturing Services Market
The rising number of emerging pharmaceutical companies engaged in the late-stage development of products and requiring the support of contract development and manufacturing organizations (CDMOs) and the increasing complexities involved in parenteral/injectable manufacturing are key factors driving the growth of this segment.
The Generic Pharmaceutical Companies Segment Slated to Grow the Fastest During the Forecast Period
The factors driving the growth of this segment are the increasing competition in the generics market leading to pricing pressures, the expiration of branded drugs and government initiatives to promote the use of generics.
Asia-Pacific to Be the Fastest-growing Regional Market
North America is estimated to command the largest share of the pharmaceutical contract development and manufacturing market in 2022, followed by Europe, Asia-Pacific, Latin America, and the Middle East & Africa. However, Asia-Pacific is poised to be the fastest-growing regional market due to the accelerated economic growth of many countries in the region, growth in the aging population coupled with the rising prevalence of chronic diseases, and growing investments in drug development. In addition, the increase in pharmaceutical outsourcing in countries such as India and China due to lower costs and the availability of qualified healthcare professionals are other key factors expected to support rapid market growth in Asia-Pacific.
Key Players
The report features the competitive landscape of the pharmaceutical contract development and manufacturing market based on an extensive assessment of the key strategic developments from leading industry players . The key players profiled in the pharmaceutical contract development and manufacturing market report are Thermo Fisher Scientific Inc. (U.S.), Catalent Inc. (U.S.), Lonza Group Ltd (Switzerland), Recipharm AB (Sweden), Vetter Pharma International GmbH (Germany), Piramal Enterprises Limited (India), Almac Group (U.K.), Cambrex Corporation (U.S.), Samsung Biologics Co., Ltd (South Korea), Siegfried Holding AG (Switzerland), FUJIFILM Diosynth Biotechnologies (Japan), Aenova Group (Germany), C.H. Boehringer Sohn AG & Co. KG (Germany), Fareva SA (Luxembourg), Fabbrica Italiana Sintetici S.p.A. (Italy), WuXi Biologics (Cayman) Inc. (China), and Aurobindo Pharma Ltd. (India).
Scope of the Report:
Pharmaceutical Contract Development and Manufacturing Market, by Service
- Pharmaceutical Manufacturing Services
- API Manufacturing Services
- FDF Manufacturing Services
- Parenteral/Injectable Manufacturing Services
- Tablet Manufacturing Services
- Capsule Manufacturing Services
- Oral Liquid Manufacturing Services
- Other Formulations Manufacturing Services
- Drug Development Services
- Biologics Manufacturing Services
- API Manufacturing Services
- FDF Manufacturing Services
- Packaging Services
Pharmaceutical Contract Development and Manufacturing Market, by End User
- Large Pharmaceutical Companies
- Small and Mid-size Pharmaceutical Companies
- Generic Pharmaceutical Companies
Pharmaceutical Contract Development and Manufacturing Market, by Geography
- North America
- Europe
- Germany
- U.K.
- France
- Italy
- Spain
- Switzerland
- Rest of Europe (RoE)
- Asia-Pacific (APAC)
- China
- Japan
- India
- Rest of APAC (RoAPAC)
- Latin America
- Brazil
- Mexico
- Rest of Latin America
- Middle East & Africa
Key questions answered in the report: