Pharmaceutical Analytical Testing Outsourcing Market Size, Share & Trends Analysis Report By Service (Bioanalytical, Stability, Method Development & Validation), By Region, And Segment Forecasts, 2020 - 2027

Industry Insights

The global pharmaceutical analytical testing outsourcing market size was estimated at USD 6.1 billion in 2019 and is anticipated to register a CAGR of 8.3% over the forecast period. Increasing demand for analytical drugs, biosimilars, and biopharmaceuticals are contributing to market growth. Other factors such as increasing investments in R&D for pharmaceuticals, rising demand for product safety and quality, and changing regulations for in vivo and in vitro tests are also expected to drive the demand for pharmaceutical analytical testing outsourcing services.

The price benefits associated with outsourcing pharmaceutical analytical testing services and approvals in the pharmaceutical industry are further projected to support market growth. Quicker and reliable results, data safety, and improved efficiency are some other key factors driving the demand for pharmaceutical analytical testing. Innovation or new product development is directly proportional to the demand for analytical testing services. Due to competitive pressures, pricing concerns, and time to market (TTM), companies are increasingly opting for the outsourcing of analytical testing services.

Increasing focus on customized care and technological advancements are shortening product lifecycle, which has resulted in the rapid development of new products. The development of combination products, biosimilars, and other innovative medicines has led to an increase in demand for specific types of pharmaceutical analytical tests. Outsourcing services are becoming the most preferred option for many pharmaceutical companies to increase operational efficiency, access therapeutic expertise, and benefit from on-demand services. 

The market comprises many players focusing on specialty services or offering end-to-end services. However, large outsourcing companies are looking to acquire high-impact service/manufacturing firms to boost their existing capabilities. A few instances include the acquisition of Clinical Research Laboratories by Eurofins in September 2018 and the acquisition of MPI Research by Charles River Laboratories International, Inc. in February 2018.

Service Insights

On the basis of service, the pharmaceutical analytical testing outsourcing market has been segmented into stability testing, bioanalytical testing, method development and validation, and other testing services which comprise environmental monitoring, raw material testing, batch release, microbial testing, and physical characterization of materials. The other testing services segment generated the highest revenue in 2019. Changing regulations for in vivo and in vitro tests and innovative approaches to reduce the complexity of the tests are contributing to an increase in the outsourcing of pharmaceutical analytical testing services.

The outsourcing of bioanalytical testing services is anticipated to witness the highest growth over the forecast period. Entry of new participants within the market space over the last ten years and an increasing number of clinical trial registrations has been witnessed. These companies prefer the outsourcing of pharmaceutical analytical testing owing to benefits such as the range of testing and analyses services offered by contract research organizations (CROs).

Clinical bioanalytical testing is expected to dominate the market through the forecast period owing to the growing number of clinical trials, along with a stringent regulatory framework, to perform the process of drug discovery and development. Furthermore, various small scale industries are not equipped with top-end analytical tools and opt for the outsourcing of pharmaceutical analytical testing to industry experts with years of experience in performing, documenting, and adapting to the challenges presented during analysis.

Regional Insights

North America accounted for the largest share of 54.2% in 2019 as the region is one of the top manufacturing hubs of complex, highly reliable, and high-end pharmaceuticals. The rapid increase in the manufacturing of pharmaceuticals to meet the rising demand for efficient healthcare in the region is projected to be one of the major factors driving the demand for pharmaceutical analytical testing outsourcing services.

Asia Pacific is projected to be the fastest-growing market as several players headquartered in developed countries are focusing on expanding their presence in the Asia Pacific region. Outsourcing services in this region is generally supported by delivery centers in Manila, China, and India. China is gaining popularity as a delivery location for nearshore and onshore clients that are based out of Japan.

Pharmaceutical Analytical Testing Outsourcing Market Insights

Some of the players operating in the market for pharmaceutical analytical testing outsourcing are Toxikon, Inc.; Intertek Group PLC; SGS SA; Eurofins Scientific; Boston Analytical; Pace Analytical Services, LLC; West Pharmaceutical Services, Inc.; WuXi AppTec, Inc.; Intertek Group Plc; Pharmaceutical Product Development, LLC; and Charles River Laboratories International, Inc.

Market players are undertaking various strategic initiatives such as mergers, acquisitions, collaborations, and service portfolio as well as geographic expansion. For instance, in May 2019, Intertek announced the expansion of its pharmaceutical services laboratory in Melbourn, England. Moreover, in August 2019, Boston Analytical opened a new office in Cambridge which provides analytical testing among other services, thereby expanding the reach of its services.

Report Scope

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of latest industry trends in each of the sub-segments from 2016 to 2027. For the purpose of this study, Grand View Research has segmented the global pharmaceutical analytical testing outsourcing market report on the basis of service and region:

• Service Outlook (Revenue, USD Billion, 2016 - 2027)

  • Bioanalytical Testing

    • Clinical

    • Non Clinical

  • Method Development & Validation

    • Extractable & Leachable

    • Impurity Method

    • Technical Consulting

    • Others

  • Stability Testing

    • Drug Substance

    • Stability Indicating Method Validation

    • Accelerated Stability

    • Photostability

    • Others

  • Others

• Regional Outlook (Revenue, USD Million, 2016 - 2027)

  • North America

    • U.S.

    • Canada

  • Europe

    • U.K.

    • Germany

    • France

    • Italy

    • Spain

    • Russia

    • Turkey

    • Netherlands

    • Switzerland

    • Sweden

  • Asia Pacific

    • Japan

    • China

    • India

    • Australia

    • South Korea

    • Indonesia

    • Malaysia

    • Singapore

    • Thailand

    • Taiwan

  • Latin America

    • Brazil

    • Mexico

    • Argentina

    • Colombia

    • Chile

  • Middle East & Africa

    • South Africa

    • Saudi Arabia

    • UAE

    • Egypt

    • Israel