Global Pharmaceutical Contract Manufacturing and Research Services Market Size

Pharmaceutical Contract Manufacturing & Research Services Market Analysis

The Pharmaceutical Contract Manufacturing and Research Services Market is expected to register a CAGR of nearly 7 % over the forecast period, 2022-2027.

The COVID-19 pandemic has significantly impacted the market. The pandemic affected the pharmaceutical industry's supply chain and distribution channels, negatively impacting the market growth. However, the pandemic also boosted the demand for contract manufacturing and research services. For instance, in December 2020, a CDMO, Recipharm signed an agreement with Moderna pharmaceutical company. As per the agreement, Recipharm supported the fill-finish part of the Moderna COVID-19 vaccine for supply to countries outside the United States.

Additionally, in January 2021, ICON PLC collaborated with Pfizer Inc. and BioNTech to provide clinical trial services to develop Pfizer and BioNTech's investigational COVID-19 vaccine program. As a part of this program, ICON worked in more than 153 sites in Europe, South Africa, the United States, and Latin America to recruit 44,000 participants for the clinical trial studies. It also provided site training, document management, and operational support for patient informed consent form review. Thus, the COVID-19 pandemic positively impacted market growth.

The major factors attributing to the market growth are growing demand to develop pharmaceutical drugs, low manufacturing costs, improving economic conditions of developing countries, and rising use of biologics.

Growing demand to develop pharmaceutical drugs is driving the demand for pharmaceutical contract manufacturing and research services market. Several market players are engaged in the implementation of strategic initiatives. For instance, in October 2020, PPD Inc. reported its expansion by opening a new multipurpose clinical research laboratory in Suzhou, China, to offer bioanalytical, biomarker, and vaccine services for clinical trials across all phases of pharmaceutical development, thereby contributing to the market growth. Also, in October 2021, CTI Clinical Trial & Consulting Services (CTI), a global contract research organization (CRO) specializing in personalized curative therapies and complex clinical programs, signed a formal, worldwide partnership agreement with BioAgilytix, a leading global contract research organization focused on supporting pharmaceutical and biotech partners in all phases of drug development.

Additionally, as per the September 2020 update by the Pharmaceutical Research and Manufacturers of America (PhRMA), the PhRMA members had invested nearly USD 83 billion in R&D activities in 2019. Furthermore, as per the same source, more than 260 vaccines are in the pipeline by biopharmaceutical companies for various diseases, including COVID-19, as per PhRMA, 2020. Moreover, as per the Organization for Economic Co-Operation and Development (OECD), pharmaceutical spending as a percentage of gross domestic product (GDP) in 2020 was 6.9% in the Netherlands, 7.2 % in Norway, 11.1 % in Iceland, 12.4% in Finland and 19.3% in South Korea.

However, regulatory issues about drug approval and limited outsourcing opted by pharmaceutical companies impede market growth.