Pharmaceutical Contract Manufacturing And Research Services Market Size, Share & Trends Analysis Report By Service (Manufacturing, Research), By Region, And Segment Forecasts, 2021 - 2028

Report Overview

The global pharmaceutical contract manufacturing and research services market size was valued at USD 174.4 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 5.75% from 2021 to 2028. Cost-saving and time-saving benefits associated with the implementation of outsourcing are responsible for driving the market. The market participants are routinely investing in infrastructure, personnel, and technology in order to gain a greater share of the outsourcing revenue. The presence of end-to-end service providers that are engaged in offering value-added services for an integrated or risk-sharing business model is expected to bolster progress in this industry.

Moreover, new product launches and novel drug delivery mechanisms that are expected to enter the market in record timelines are anticipated to drive outsourcing demand. For example, in March 2016, Lonza launched PowerCHO Advance Media, developed to enhance protein production yields. This media facilitates filterability, improves cell growth, and yields greater protein titer. The industry has been alternating between the cycles of inadequate and excessive production capacity for the contract as well as captive manufacturers.

Changing product portfolio is also responsible for the growth of the service-based market. “One-stop-shop” offered by the CMOs for the promotion of a portfolio of a complete range of products is anticipated to influence the growth of CMOs. Furthermore, differentiation and consolidation strategies adopted by companies can lead to projected advancement. For example, in August 2016, Catalent Pharma Solutions collaborated with Zumutor for the development of antibodies with improved antibody‐dependent cellular cytotoxicity activity. Under this collaboration, Catalent’s proprietary GPEx technology would be used with Zumutor’s fucose knockout platform for antibody development.

The larger CMOs are embracing the trend of moving and focusing on the niche areas of pharmaceutical development. They are focusing on the establishment of regulatory pathways for transgenic-based product development. However, the companies are willing to restrict outsourcing for the manufacturing of complex and big moieties. They are in an opinion of in-house production rather than outsource owing to the specific requirements. This, in turn, may act as a challenge for the industry. In addition to this, dynamic changes witnessed in this sector, coupled with severe pressure over the margins, are anticipated to restrain the market growth to a considerable extent.

Due to the COVID-19 pandemic, the supply chain scenario has changed and is likely to have a short-term impact on the contract manufacturing industry. It is said that contract manufacturers and pharma players have taken significant steps, which will help stakeholders to absorb this impact. In addition, as pharma companies continue the full-scale process after the COVID-19 outbreak, increasing demand for large-scale contract manufacturing is seen, which is likely to rise significantly during the forecast period.

Service Insights

The manufacturing service held the largest share of over 65.0% in 2020. These services are further segmented into API/bulk drugs manufacturing, advanced drug delivery formulations, packaging, and finished dose formulations. API dominated the market in 2020 as a consequence of the rising demand for High Potency Active Pharmaceutical Ingredients (HPAPI). Market entities are engaged in the development of large-scale manufacturing facilities on a pilot as well as commercial scale.

Finished dose formulations are anticipated to expand at the fastest CAGR over the forecast period. Amongst these, solid dosage forms accounted for the largest revenue share in 2020 due to the higher outsourcing done for the powdered formulations. It is expected to witness gradual expansion in the coming years as it represents a significant share of the outsourcing of finished dose formulations. Solid dose manufacturing and oral delivery of new drug candidates, fixed-dose combinations, controlled release dosage forms, and reformulation of existing drugs are some of the factors likely to accelerate the growth of contract manufacturing of solid dosage formulations.

Regional Insights

Asia Pacific dominated the market with a revenue share of over 45.0% in 2020 and is projected to grow at a significant rate over the forecast period. This growth is supported by a rise in the number of companies outsourcing projects in the developing economies of this region. In recent years, countries such as Singapore, China, and India have been observed as major players in the pharmaceutical industry owing to their expanding manufacturing capabilities.

The cash-rich nature of the Asian companies is responsible for the captive nature of the contract manufacturing sector. The spout of significant investments by Asian CMOs is expected to result in exponential progress. Furthermore, the Latin American market is anticipated to witness substantial growth as a consequence of the presence of established multinational players in this region. Major entities operating in Brazil are Novartis, Roche, and Pfizer.

Latin America holds the potential for transforming into a global hub for the development and production of pharmaceutical products. Factors that are responsible for this transformation include the low cost of product development.

Key Companies & Market Share Insights

Key trends amongst the biotechnology and pharmaceutical entities include consolidation for industry outsourcing and parallel mergers and acquisitions. In addition to this, the service providers are striving in order to fortify their capabilities for enhancing market presence.

Market participants are also engaged in business profile repositioning through divestitures of specific product lines or business units. The incorporation of technological advances to provide services with quality by design and risk-based monitoring is also implemented by players. In an effort to reduce the costs and boost operational efficiencies, life science companies are focusing on selling the domestic production plants to contract organizations. Industry participants are also focusing on adaptive and intelligent monitoring strategies. Some prominent players in the global pharmaceutical contract manufacturing and research services market include:

• Catalent

• Pharmaceutical Product Development LLC

• AbbVie

• Baxter BioPharma Solutions

• Patheon

• Grifols International, S.A.

• Dalton Pharma Services

• Boehringer Ingelheim Biopharmaceuticals GmbH

• Lonza AG

Pharmaceutical Contract Manufacturing And Research Services Market Report Scope

Segments Covered in the Report

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2016 to 2028. For the purpose of this report, Grand View Research has segmented the global pharmaceutical contract manufacturing and research services market report on the basis of service and region:

• Service Outlook (Revenue, USD Billion, 2016 - 2028)

  • Manufacturing

    • API/Bulk Drugs

    • Advanced Drug Delivery Formulations Packaging

    • Packaging

    • Finished Dose Formulations

      • Solid Formulations

      • Liquid Formulations

      • Semi-solid Formulations

  • Research

    • Oncology

    • Vaccines

    • Inflammation & Immunology

    • Cardiology

    • Neuroscience

    • Others

• Regional Outlook (Revenue, USD Billion, 2016 - 2028)

  • North America

    • U.S.

    • Canada

  • Europe

    • Germany

    • France

  • Asia Pacific

    • India

    • China

  • Latin America

    • Brazil

    • Mexico

    • Colombia

    • Argentina

    • Chile

    • Venezuela

  • Middle East and Africa (MEA)

    • South Africa