Pharmaceutical Processing Equipment Market (2022-2029)

The COVID-19 pandemic has positively impacted the pharmaceutical processing equipment market. It has increased the demand for therapeutics for fighting the COVID-19 outbreak. Several pharmaceutical manufacturers are expanding their manufacturing facilities due to the significant demand for vaccines and medicines for the novel coronavirus. Pharmaceutical manufacturing is also outsourcing operations to meet the growing market demand. This strategy is expected to improve the demand for new processing equipment.

Pharmaceutical manufacturing was lagging in various countries because of the disruption created in the supply chain due to the COVID-19 pandemic. To tackle this situation, the public organizations of various countries have focused on decreasing the dependency on imports by domestic pharmaceutical manufacturing. The reshoring manufacturing opportunities would be developed in Europe, the U.S., and Japan. Additionally, the government of these countries are also likely to develop preferred access regulations mandating the local supply of essential API and drugs using available financial grants.

Growing Trend of Contract Manufacturing in the Pharmaceutical Sector

Pharmaceutical companies face challenges such as controlling manufacturing costs and navigating stringent regulatory approval processes. The high consumption of small molecules for treating different diseases, the emergence of advanced technologies in the manufacture of finished dosage formulations, patent expirations of small molecules, and the rising demand for generics support the growth of contract manufacturing in the pharmaceutical sector. Small pharmaceutical companies also lack well-equipped infrastructure, advanced technologies, and high containment capabilities to produce pharmaceuticals, due to which they prefer outsourcing manufacturing operations to keep initial investments low. As manufacturing processes are becoming increasingly complex and stringent regulations are being imposed, pharmaceutical companies are developing long-term contracts with Contract Manufacturing Organizations (CMOs).

Pricing pressures in the pharmaceutical industry have driven pharmaceutical CMOs to establish operations in India, China, Singapore, South Korea, and Malaysia. The Government of India offers soft loans to support manufacturing facilities for CMOs in India. According to the Indian Drug Manufacturers’ Association (IDMA), India has the edge over other countries in producing basic medicinal products due to the availability of cost-effective resources, WHO-GMP-approved production facilities, and rapidly developing infrastructure. The CMOs that offshore operations to India can lower production costs by 40%.

Thus, the pricing pressures prevalent in the pharmaceutical industry and increased pharmaceutical production are expected to increase the focus on contract manufacturing.