Global Contract Research Organization Market Size

Contract Research Organization Market Analysis

The market for contract research organizations was valued at USD 44,049.76 million in the current year. It is expected to make USD 66,106.81 million in sales, which is a CAGR of 7.0% over the next few years.

The COVID-19 pandemic had a big effect on the contract research organization (CRO) market because clinical trials were still going on to find effective treatments and vaccines for the SARS-CoV-2 virus. For example, in January 2021, ICON PLC and Pfizer Inc. and BioNTech announced that they would work together to develop the investigational COVID-19 vaccine program that Pfizer and BioNTech were working on.As a part of this program, ICON worked at more than 153 sites in Europe, South Africa, the United States, and Latin America to recruit 44,000 participants for clinical trial studies. Besides, the number of mergers and acquisitions (M&A) among CROs saw an uptick in 2021, despite the COVID-19 pandemic. Clinical Trials Arena said in April 2022 that there were 50 completed M&A deals last year, which is 21 more than in 2020, when there were only 29.There were 20 completed M&A CRO deals in the first half of 2021, with 30 such deals in the second half. After a pandemic, CROs will be able to use the lessons they learned from COVID-19 and adopt new technologies to improve data management, reduce staffing needs, and make patient monitoring easier.For example, a Frontiers Media S.A. article from April 2022 says that the use of AI technology helps SMEs turn COVID-19 challenges into chances to improve their performance and their chances of staying in business.Thus, due to the increased focus on vaccine development against COVID-19, there was an increase in clinical trials along with the adoption of emerging technologies, which boosted the CRO market.

The growth of the market is due to more money being spent on research and development, more R&D activities being outsourced, and more clinical trials.Pharmaceutical companies' bottom lines continue to be affected by things like patents that expire and let generic competitors enter the market and strict requirements from regulators.According to the Congressional Research Service update, by September 2022, global R&D spending will have significantly increased since 2000, rising from USD 675 billion to USD 2.4 trillion by 2020. Furthermore, according to the UNESCO Institute for Statistics (UIS), in 2022, nearly USD 1.7 trillion will have been spent globally on R&D, which is a record high. Approximately 10 nations receive 80% of the money spent. Countries have committed to significantly boosting public and corporate R&D spending as well as the number of researchers by 2030 as part of the Sustainable Development Goals. Hence, with strong investments in R&D activities and a robust pipeline of therapeutics under development, the CRO market is expected to witness significant growth over the forecast period.

The growth of the market is also being driven by the fact that CROs are offering more and more services and that collaborations are becoming more popular. For example, in September 2022, the Australian CRO for biotechs, Avance Clinical, grew into North America by buying the CRO partner company C3 Research Associates. This made it easy for biotech clients to move from early-phase studies to later-phase studies.Thermo Fisher Scientific, Inc. also bought Pharmaceutical Product Development, LLC, a company that helps the biotech and biopharma industries, in December 2021.Thus, due to these factors, the market is expected to register significant growth over the forecast period.

However, the shortage of skilled professionals is expected to restrain market growth.