Pharmaceutical Contract Development and Manufacturing Organization (CDMO) Market - Growth, Trends, COVID-19 Impact, and Forecast (2022 - 2027)

The Pharmaceutical Contract Development and Manufacturing Organization (CDMO) Market can be segmented by Service Type - CMO Segment (Active Pharmaceutical Ingredient (API) Manufacturing, Finished Dosage Formulation (FDF) Development and Manufacturing, Secondary Packaging), Research Phase - CRO Segment (Preclinical, Phase I, Phase II, Phase III, Phase IV), and Geography.

Market Snapshot

Pharmaceutical CDMO Market Overview
Study Period: 2020-2027
Base Year: 2021
Fastest Growing Market: Asia Pacific
Largest Market: North America
CAGR: 7.29 %

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Market Overview

The global pharmaceutical CDMO market was valued at USD 183.62 billion in 2021, and it is expected to reach USD 289.64 billion by 2027, registering a CAGR of 7.29% during the period of the forecast period.

  • As a result of the rising demand for generic medicines and biologics, the capital-intensive nature of the business, and the complex manufacturing requirements, many pharmaceutical companies have identified the potential profitability in contracting with a CMO (contract manufacturing outsourcing) for both clinical and commercial stage manufacturing.
  • The most significant factor driving the growth of CMOs in the pharmaceutical industry is the growing need for state-of-the-art processes and production technologies, which have proven significantly effective in meeting regulatory requirements.
  • The pharmaceutical companies have been directing their priorities towards core competency areas. Hence, they prefer not to dispense available resources, expertise, and technology on formulating the final dose of medicines. The increased competition and shrinking profit margins compelled the pharmaceutical companies to revisit their production processes and R&D activities instead of manufacturing the formulated drug to stay competitive in the market.
  • Furthermore, the complexity of the biopharmaceuticals, coupled with the highly personalized medical therapies and devices, drive the increased complexity in the operations of the supply chain and lead to increasing reliance on contract manufacturing. Factors such as these are helpful in the proliferation of the CMO market. In March 2021, Fujifilm Diosynth Biotechnologies selected Holly Springs, North Carolina, for its new JPY 200 billion large-scale cell-culture biomanufacturing site. The new facility will provide large-scale cell-culture manufacturing for bulk drug-substance production. The facility is expected to be operational by the spring of 2025.
  • The CMO/CDMO service sector is uniquely positioned to address some of the challenges that drug developers face amid the COVID-19 pandemic. This pandemic has impacted multiple aspects of the pharma and biopharma industry, from drug development, clinical trials, supplies, manufacturing to supply chain logistics. However, the drug shortages due to COVID-19 are limited, and they are expected to remain so for the short term due to stockpiles of pharmaceuticals, APIs globally.

Scope of the Report

Contract manufacturing is a form of outsourcing where a manufacturer enters a formal agreement with another manufacturing firm for its parts, products, or components. The former manufacturer uses these in its manufacturing process for manufacturing its products. The study provides a granular view of the current CMO industry, with a further breakdown of each segment by region.

A contract manufacturing organization (CMO) is an organization that serves the pharmaceutical industry and provides clients with comprehensive services, from drug development to manufacturing. Outsourcing to a CMO allows the pharmaceutical clients to expand theIR technical resources without increased overhead. The client can manage its internal resources and costs by focusing on its core competencies and high-value projects while reducing or not adding infrastructure or technical staff.

The study provides a granular view of the current CMO industry, with a further breakdown of each segment by region, as listed in the index.

By Service Type CMO Segment
Active Pharmaceutical Ingredient (API) Manufacturing
Finished Dosage Formulation (FDF) Development and Manufacturing
Solid Dose Formulation
Liquid Dose Formulation
Injectable Dose Formulation
Secondary Packaging
By Research Phase CRO Segment
Pre-clinical
Phase I
Phase II
Phase III
Phase IV
By Geography - Global Pharmaceutical CMO
North America
Segmentation by Service Type
Segmentation by Country
United States
Canada
Europe
Segmentation by Service Type
Segmentation by Country
United Kingdom
Germany
France
Italy
Rest of Europe
Asia Pacific
Segmentation by Service Type
Segmentation by Country
China
India
Japan
Australia
Rest of Asia Pacific
Latin America
Segmentation by Service Type
Segmentation by Country
Brazil
Mexico
Argentina
Rest of Latin America
Middle East and Africa
Segmentation by Service Type
Segmentation by Country
United Arab Emirates
Saudi Arabia
South Africa
Rest of Middle East and Africa
By Geography- Global Pharmaceutical CRO
North America
Europe
Asia Pacific
Latin America
Middle East and Africa

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Key Market Trends

Increasing Investment in R&D expected to Drive the Market

  • The United States is the world’s largest market for drugs and accounts for almost half of the R&D spending in the pharmaceutical and biotechnology markets. Hence, CMOs play a critical role in this market and have invested in new facilities and technologies to cater to a wide range of outsourcing units.
  • Besides capturing the benefits of a location in Asia through an in-house investment, companies are also turning to research-based partnerships as a way of high-end sourcing expertise, building drug discovery, and manufacturing investment in Asia.
  • The biggest Chinese professional manufacturer of dermatology and anti-tuberculosis drug products, Huapont, is one of the fastest-growing pharmaceutical manufacturers in China, mainly dependent on product R&D and market expansion.
  • CRO/CMOs are able to leverage their expertise, owing to their R&D and complex manufacturing capabilities, to fill the needs of the large generic, big pharmaceutical, and biotech companies.
  • The highly fragmented nature of the US pharmaceutical contract manufacturing market, with over 150 CMOs, results in price competition and drives down CMO revenue.
  • A major stake of R&D investments and capacity expansions is likely in the injectable and sterile liquid dose formulations segment. Small biotech firms get access to specialized knowledge and resources, which help them expedite their R&D activities.
  • Greater technological complexity in drug development and greater specificity in disease targets have helped raise average R&D costs, as firms now identify drugs with particular molecular characteristics as opposed to using trial-and-error methods to find compounds that work in some desired way.
Pharmaceutical CDMO Market

North America is Estimated to hold the largest market for CRO

  • North America is the largest market for contract research organizations (CRO), with the United States ushering the market, followed by Canada. The region's dominance is due to many pharmaceutical companies and extensive drug development activity, especially in the United States. Moreover, the region has a strong foothold of CROs, which contributes to the market's growth. Some of them include IQVIA Holdings Inc., Pharmaceutical Product Development LLC, PRA Health Sciences Inc., PAREXEL International Corp, and Laboratory Corporation of America Holdings.
  • Furthermore, the growing investment for acquisition for accelerating CRO's capabilities is expected to boost the studied market's growth positively. In January 2021, Parexel and Signify Health announced a strategic collaboration to provide customers with new CRO solutions to enable a more diverse and traditionally underrepresented population for their clinical trials. The partnership will improve patient access to clinical trials, bringing studies to patients in their own homes.
  • Moreover, the growing investment for accelerating CRO's capabilities is expected to boost the market's growth. For instance, in November 2021, NAMSA, the MedTech Contract Research Organization (CRO) offering global end-to-end development services, announced the expansion of its Minneapolis preclinical research laboratory. This expansion will add 55,000 sq. ft. to the current 130,000 sq. ft. preclinical campus in Minneapolis.
  • Further, Cardiovascular and circulatory diseases are the leading cause of death in the country. Hence, these therapies are the second-most highly-tested in clinical trials across the nation, with a total of 62,115 studies conducted in the past 20 years.
Pharmaceutical CDMO Market

Competitive Landscape

The CDMO Market is consolidated in nature. The need for continued research and development-related expenses push forward for the extension of business opportunities. In the pharmaceutical industry, medicine is continuously tested and is most profitable during the patent period; the emergence of competitive solutions can hamper the return rate. Such factors push for continued innovation and fast-track the introduction time to market. Major players include Catalent Inc., Recipharm AB, Jubilant Life Sciences Ltd.

  • May 2021 - Thermo Fisher Scientific Inc. is building a 44,000-square-foot, state-of-the-art development, manufacturing, and collaboration center in leased space on UCSF's Mission Bay campus, including biomedical research facilities and hospitals. The site will offer clinical and commercial manufacturing services for cGMP cell therapy and support UCSF and other partners.
  • January 2021- Samsung Bioepis Co. Ltd announced its expansion into the Asia-Pacific region in Korea with a 52,000 square feet campus to become the hub of Samsung Bioepis’ drive for accelerated development of next-generation biologic medicines.

Recent Developments

  • January 2021- CMIC Co Ltd. joined the Decentralized Trials & Research Alliance (DTRA), an alliance seeking to accelerate the broad adoption of decentralized clinical trials, as a Founding Company. CMIC would join the DTRA Leadership Council, effectively advancing decentralized trials in Japan by strengthening its connection with respective organizations and companies in the United States.
  • January 2021- SGS announced the acquisition of the lab facilities of ISL, a laboratory providing analytical services for pharmaceutical products and substances based in Ringaskiddy (Cork), Ireland. Post-transfer, ISL becomes the strategic component of SGS’s global life sciences laboratory network, and ISL is expected to continue pharmaceutical quality control testing and support Novartis’ major manufacturing operations.
  • January 2021- Parexel and Signify Health today announced a strategic collaboration to provide customers with new solutions to enable access to a more diverse and traditionally underrepresented population for their clinical trials. The partnership will focus on improving patient access to clinical trials, bringing studies to patients in their own homes.

Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Assumptions and Market Definition

    2. 1.2 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET INSIGHTS

    1. 4.1 Market Overview

    2. 4.2 Industry Attractiveness - Porter's Five Forces Analysis

      1. 4.2.1 Porter's Five Forces Analysis for CMO

      2. 4.2.2 Porter's Five Forces Analysis for CRO

    3. 4.3 Industry Value Chain Analysis

    4. 4.4 Industry Policies

    5. 4.5 Assessment of the Impact of COVID-19 on Industry

  5. 5. MARKET DYNAMICS

    1. 5.1 Market Drivers

    2. 5.2 Market Restraints

    3. 5.3 Emphasis on Solid-based Oral Dosage Formulations

    4. 5.4 Qualitative coverage on the 3D printing developments in the OSD segment

  6. 6. TECHNOLOGY SNAPSHOT

    1. 6.1 Dosage Formulation Technologies

    2. 6.2 Dosage Forms by Route of Administration

    3. 6.3 Key Considerations for Outsourcing of Pharmaceutical R&D

    4. 6.4 Major Segments in CRO Bio Analytical Testing, Central Laboratory Testing, and cGMP Testing

  7. 7. MARKET SEGMENTATION

    1. 7.1 By Service Type CMO Segment

      1. 7.1.1 Active Pharmaceutical Ingredient (API) Manufacturing

      2. 7.1.2 Finished Dosage Formulation (FDF) Development and Manufacturing

        1. 7.1.2.1 Solid Dose Formulation

        2. 7.1.2.2 Liquid Dose Formulation

        3. 7.1.2.3 Injectable Dose Formulation

      3. 7.1.3 Secondary Packaging

    2. 7.2 By Research Phase CRO Segment

      1. 7.2.1 Pre-clinical

      2. 7.2.2 Phase I

      3. 7.2.3 Phase II

      4. 7.2.4 Phase III

      5. 7.2.5 Phase IV

    3. 7.3 By Geography - Global Pharmaceutical CMO

      1. 7.3.1 North America

        1. 7.3.1.1 Segmentation by Service Type

        2. 7.3.1.2 Segmentation by Country

          1. 7.3.1.2.1 United States

          2. 7.3.1.2.2 Canada

      2. 7.3.2 Europe

        1. 7.3.2.1 Segmentation by Service Type

        2. 7.3.2.2 Segmentation by Country

          1. 7.3.2.2.1 United Kingdom

          2. 7.3.2.2.2 Germany

          3. 7.3.2.2.3 France

          4. 7.3.2.2.4 Italy

          5. 7.3.2.2.5 Rest of Europe

      3. 7.3.3 Asia Pacific

        1. 7.3.3.1 Segmentation by Service Type

        2. 7.3.3.2 Segmentation by Country

          1. 7.3.3.2.1 China

          2. 7.3.3.2.2 India

          3. 7.3.3.2.3 Japan

          4. 7.3.3.2.4 Australia

          5. 7.3.3.2.5 Rest of Asia Pacific

      4. 7.3.4 Latin America

        1. 7.3.4.1 Segmentation by Service Type

        2. 7.3.4.2 Segmentation by Country

          1. 7.3.4.2.1 Brazil

          2. 7.3.4.2.2 Mexico

          3. 7.3.4.2.3 Argentina

          4. 7.3.4.2.4 Rest of Latin America

      5. 7.3.5 Middle East and Africa

        1. 7.3.5.1 Segmentation by Service Type

        2. 7.3.5.2 Segmentation by Country

          1. 7.3.5.2.1 United Arab Emirates

          2. 7.3.5.2.2 Saudi Arabia

          3. 7.3.5.2.3 South Africa

          4. 7.3.5.2.4 Rest of Middle East and Africa

    4. 7.4 By Geography- Global Pharmaceutical CRO

      1. 7.4.1 North America

      2. 7.4.2 Europe

      3. 7.4.3 Asia Pacific

      4. 7.4.4 Latin America

      5. 7.4.5 Middle East and Africa

  8. 8. COMPETITIVE LANDSCAPE*

    1. 8.1 Company Profiles - CMO

      1. 8.1.1 Catalent Inc.

      2. 8.1.2 Recipharm AB

      3. 8.1.3 Jubilant Life Sciences Ltd

      4. 8.1.4 Patheon Inc.

      5. 8.1.5 Boehringer Ingelheim Group

      6. 8.1.6 Pfizer CentreSource

      7. 8.1.7 Aenova Holding GmbH

      8. 8.1.8 Famar SA

      9. 8.1.9 Baxter Biopharma Solutions

      10. 8.1.10 Lonza Group

      11. 8.1.11 Tesa Labtec GmbH (TESA SE)

      12. 8.1.12 Tapemark

      13. 8.1.13 ARX LLC.

    2. 8.2 Company Profiles - CRO

      1. 8.2.1 CMIC Holdings Co. Ltd

      2. 8.2.2 Covance Inc.

      3. 8.2.3 Syneos Health Inc.

      4. 8.2.4 LSK Global Pharma Service Co. Ltd

      5. 8.2.5 Novotech Pty Ltd

      6. 8.2.6 PAREXEL International Corporation

      7. 8.2.7 Pharmaceutical Product Development LLC

      8. 8.2.8 PRA Health Sciences Inc.

      9. 8.2.9 Quanticate Ltd

      10. 8.2.10 IQVIA Holdings Inc.

      11. 8.2.11 SGS Life Science Services SA

      12. 8.2.12 Hangzhou Tigermed Consulting Co. Ltd

      13. 8.2.13 Samsung Bioepis Co. Ltd

      14. 8.2.14 WuXi AppTec Inc.

      15. 8.2.15 Sagimet Biosciences (3V Biosciences Inc.)

  9. 9. INVESTMENT SCENARIO

  10. 10. FUTURE OUTLOOK OF THE GLOBAL PHARMACEUTICAL CONTRACT DEVELOPMENT AND MANUFACTURING MARKET

*List Not Exhaustive

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Frequently Asked Questions

The Pharmaceutical CDMO Market market is studied from 2020 - 2027.

The Pharmaceutical CDMO Market is growing at a CAGR of 7.29% over the next 5 years.

Asia Pacific is growing at the highest CAGR over 2021- 2026.

North America holds highest share in 2021.

Catalent Inc., Recipharm AB, Jubilant Life Sciences Ltd., Patheon Inc., Boehringer Ingelheim Group are the major companies operating in Pharmaceutical CDMO Market.

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