GVR Report cover Small Molecule Innovator CDMO Market Size, Share & Trends Report

Small Molecule Innovator CDMO Market Size, Share & Trends Analysis Report By Product (Small Molecule API, Small Molecule Drug Product), By Stage Type, By Customer Type, By Therapeutic Area, By Region, And Segment Forecasts, 2022 - 2030

  • Report ID: GVR-4-68039-908-0
  • Number of Pages: 119
  • Format: Electronic (PDF)
  • Historical Range: 2017 - 2020
  • Industry: Healthcare

Report Overview

The global small molecule innovator CDMO market size was valued at 42.1 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 6.5% from 2022 to 2030. There was unprecedented growth in 2020 due to the COVID-19 pandemic. The EFCG reported that around 80% of chemicals used to make drugs sold in Europe are supplied from India and China. The major factors fueling the growth of this market include increasing pharmaceutical R&D investment and the rising incidence of cancer and age-related disorders across the globe. Another factor fueling the market growth is the growing demand for small molecule drugs. In 2020, small molecule drugs dominated new molecular entities (NMEs) approvals. Small molecules accounted for 75% of the 53 NMEs approved in 2020. This continues a recent trend in which small molecules account for roughly three-quarters of NME approvals. Small molecules accounted for 79% of NME approvals in 2019, compared to 71% in 2018 and 74% in 2017.

U.S. small molecule innovator CDMO market size, by product, 2020 - 2030 (USD Billion)

The COVID-19 pandemic has significantly impacted the global economy in 2020 and has had an ongoing impact on various industries. However, the market for healthcare contract development and manufacturing organization (CDMO) witnessed a positive impact due to this pandemic. CDMOs are playing an important role in meeting the needs of pharmaceutical companies, biotech companies, and other end users during this crisis. CDMO players are offering pharma, biotech, and other end-user companies cost-efficiency, time-saving, and specialized expertise. Overall, the pandemic has boosted the growth of the market. With the growing demand for outsourcing by pharma companies, CDMOs are now focusing more on continuous bioprocessing and process intensification.

Small molecules continue to play an important role in the development of new treatments globally. Specialty medicines are increasingly driving the global pharmaceutical industry, particularly in developed markets, with small molecule applications accounting for over half of specialty sales. In addition, the expansion of the small molecule API innovator CDMO market can be attributed to the increase in cancer cases and a rise in the demand for effective diagnosis and R&D for oncology procedures. According to the WHO, cancer is the leading cause of death globally, with approximately 10 million estimated fatalities in 2020. Cancers in men include prostate, lung, colorectal, stomach, and liver cancers, whereas cancers in women include breast, colorectal, lung, cervical, and thyroid cancers.

Product Insights

The small molecule API segment dominated the market and accounted for a revenue share of over 60.0% in 2021. This growth can primarily be attributed to the rising demand for small molecule innovators. Drug substances have become more complex, manufacturing methods have become more specialized, drug delivery solutions have become increasingly sophisticated, and regulatory standards have become strict to ensure patients receive a higher level of quality and efficacy.

The small molecule drug product segment is expected to expand at a CAGR of 6.0% over the forecast period. The small molecule drug substances have become more complex, with manufacturing methods becoming more specialized. In addition, drug delivery solutions have become increasingly sophisticated, and regulatory standards have become strict to ensure patients receive a higher level of quality and efficacy. Not all clinical-stage drug companies typically manufacture commercial products and vice versa. As a result, they are subject to many laws and inspection intervals, among other things. Partnering with a reputable CDMO with well-maintained GMP facilities, a proven regulatory track record, and a strong quality system can greatly reduce regulatory risk.

Stage Type Insights

The clinical segment dominated the market in 2021 and held a revenue share of over 50.0%. The clinical phase represents the organization's future, where mistakes can result in products not making it through the clinic or clinical programs being delayed, not to mention the impact on patients. Clinical manufacturing procedures are in constant flux, unlike commercial operations where operations are well-defined and methods are proven. Contract Manufacturing Organizations (CDMOs) can offer specialized expertise and save time for APIs at the clinical stage, thereby boosting demand.

The commercial segment is projected to register the fastest growth rate of 7.2% over the forecast period. The rising demand for outsourcing by small- and medium-sized pharmaceutical companies is one of the factors driving the segment. Small molecules accounted for 75% of the 53 NMEs approved in 2020. This continues a recent trend in which small molecules account for roughly three-quarters of NME approvals. During the commercial phase, the focus of pharmaceutical and biotechnology firms shifts.

While increasing the throughput as rapidly as possible, companies also have to consider GMP compliance that is, scaling a 10-patient procedure to 100, 150, or 200 patients per month in compliance with regulations. It also entails expanding the QC testing laboratory to assure product integrity and stay on the right side of a more active and ever-changing regulatory body. The labor paradigm that had previously serviced R&D activities will not work in the commercial space. This is where the role of CDMOs comes into play. CDMOs offer specialized expertise, time-saving, and cost-efficiency, which is likely to propel the segment growth during the forecast period.

Customer Type Insights

The pharmaceutical segment accounted for over 90.0% share of the global revenue in 2021. The biotechnology segment includes biotechnology firms. In these firms, the production of small molecules is also done. For instance, BioMarin Pharmaceuticals is a biotech firm, which also has a subsidiary that caters to small molecules (Zacharon Pharmaceuticals). Kuvan is one drug developed by the company that is a small molecule. Small molecule drugs are defined as any organic substance with low molecular weight and have several specific therapeutic advantages. The majority of them would be taken orally and pass-through cell membranes to reach intracellular targets.

The rapid advancement of biopharmaceutical research and technology opens new opportunities for generating small molecule drugs that are both innovative and creative. In recent years, advancements in prediction, structure-based design, imaging, automation, artificial intelligence, and machine learning have become major enablers for small molecule-led optimization to increase speed and enhance success rates. The segment's expansion is being fueled by factors such as rising biopharmaceutical demand and enhanced molecular efficiency. Furthermore, this growth can be attributed to large investments in the biotechnology and biopharmaceutical industries.

Therapeutic Area Insights

The oncology segment held the largest revenue share of over 40.0% in 2021 and is anticipated to register the fastest growth rate over the forecast period owing to the increasing number of cancer cases globally. Furthermore, increased government reimbursement policies and a rise in financing for the development of small molecule oncology therapies are other factors boosting the segment growth. In 2018, 42 NCEs were approved, and 38 in 2019 - a significant rise over the recent average of 25-35 NCE approvals per year. Consumption statistics for all small-molecule prescription drugs in seven main markets (the U.S., the U.K., France, Germany, Spain, Italy, and Japan) show a total volume of 3,500 metric tonnes, with an annual growth of roughly 100-200 metric tonnes of API. This comprises the large, 100-ton-plus, high-prevalence-disease sector, as well as the 10-20 tonne range, which represents more-targeted medicines, such as orphan pharmaceuticals.

Global small molecule innovator CDMO market share, by therapeutic area, 2021 (%)

The industry is also being driven by supportive government reimbursement policies and financing for the development of small molecule oncology therapies. In addition, CDMOs are increasing their investments in facilities for the production of highly powerful APIs (HPAPIs). The amount of small molecule cancer medicines currently in development is a reliable measure of the HPAPI sector's overall strength (most HPAPIs are being developed for the oncology sector). Overall, the small molecule oncology pipeline is growing, with 38% of small molecule therapeutic candidates in preclinical development, 35% of clinical-stage small molecules, and one-third of recent FDA approvals also coming from small molecule oncology. The 252 oncology drugs on the market or in development in 2019 have a market value of about USD 53 billion and a volume of 920 tones, which is large when compared to normal commercial API volumes of around five tones per molecule.

Regional Insights

Asia Pacific accounted for the largest revenue share of over 40.0% in 2021. A key factor fueling the regional market growth is the significantly cheaper manufacturing costs than North America and Europe and favorable laws. In the Asia Pacific region, China and India have remained dominant growth markets. Increasing regulatory focus on quality control for manufacturing is one of the key factors expected to drive the market over the forecast period. Asia Pacific has a number of regulatory agencies, such as the Pharmaceuticals and Medical Devices Agency (PMDA) in Japan; the Ministry of Food and Drug Safety (MFDS) in South Korea; the Therapeutic Goods Administration (TGA) in Australia; and the Singapore Health Sciences Authority (HSA) in Singapore.

North America held the second-largest revenue share in 2021. It is one of the major contributors to the growth of the global market. It is characterized by the presence of several established pharmaceutical, biotechnology, and medical device companies. Furthermore, growing R&D investments by life sciences and pharmaceutical companies are anticipated to increase the demand for contract manufacturing in the region. Stringent regulations on the development, manufacturing, and quality control of products are anticipated to create growth opportunities for domestic contract manufacturing services.

Key Companies & Market Share Insights

Companies are undertaking various strategic initiatives to gain a competitive advantage over other players. Key parameters affecting the competitive nature of the market include acquisitions, geographic expansions, mergers and acquisitions, and product launches. For instance, in October 2020, Corden Pharma announced that its Boulder, Colorado site has accomplished the development of a new, highly powerful API laboratory. Customers can now use the new laboratory, which can handle highly strong chemicals with an OEL as low as 1 ng/m3.

In January 2020, WuXi STA opened a large-scale oligonucleotide active pharmaceutical ingredients (API) manufacturing facility in China for the manufacturing of oligonucleotide APIs for preclinical to commercial purposes. In August 2020, Piramal Pharma Solutions will partner with Epirium Bio for new orphan drugs targeting rare diseases. In December 2021, CordenPharma acquire three-drug product manufacturing facilities from Vifor Pharma Group for the manufacturing of iron therapies active pharmaceutical ingredient (API). Some prominent players in the global small molecule innovator CDMO market include:

  • Piramal Pharma Solutions

  • Corden Pharma

  • Wuxi AppTec

  • Cambrex Corporation

  • Recipharm AB

  • Thermo Fisher Pantheon

  • Lonza Group Ltd.

  • Catalent Inc.

  • Siegfried Holding AG

  • Boehringer Ingelheim

  • Covance Inc.

Small Molecule Innovator CDMO Market Report Scope

Report Attribute

Details

Market Size value in 2022

USD 45.2 billion

Revenue forecast in 2030

USD 74.9 billion

Growth Rate

CAGR of 6.5% from 2022 to 2030

Base year for estimation

2021

Historical data

2017 - 2020

Forecast period

2022 - 2030

Quantitative units

Revenue in USD million/billion and CAGR from 2022 to 2030

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

Segments covered

Product, stage type, customer type, therapeutic area, region

Regional scope

North America; Europe; Asia Pacific; Latin America; Middle East & Africa

Country scope

U.S.; Canada; U.K.; Germany; France; Italy; Spain; India; Japan; China; Australia; South Korea; Brazil; Mexico; Argentina; South Africa; Saudi Arabia; UAE

Key companies profiled

Lonza Group Ltd.; Patheon; Cambrex Corporation; Catalent Inc.; Siegfried holdings AG; Recipharm AB; Corden Pharma International; Boehringer Ingelheim; Piramal Pharma Solutions; Covance Inc.; Wuxi AppTec ; Thermo Fisher Pantheon

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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 2017 to 2030. For the purpose of this study, Grand View Research has segmented the global small molecule innovator CDMO market report on the basis of product, stage type, customer type, therapeutic area, and region:

  • Product Outlook (Revenue, USD Million, 2017 - 2030)

    • Small Molecule API

    • Small Molecule Drug Product

      • Oral Solid Dose

      • Semi-Solid Dose

      • Liquid Dose

      • Others

  • Stage Type Outlook (Revenue, USD Million, 2017 - 2030)

    • Preclinical

    • Clinical

      • Phase I

        • Small

        • Medium

        • Large

      • Phase II

        • Small

        • Medium

        • Large

      • Phase III

        • Small

        • Medium

        • Large

    • Commercial

  • Customer Type Outlook (Revenue, USD Million, 2017 - 2030)

    • Pharmaceutical

      • Small

      • Medium

      • Large

    • Biotechnology

  • Therapeutic Area Outlook (Revenue, USD Million, 2017 - 2030)

    • Cardiovascular Diseases

    • Oncology

    • Respiratory Disorders

    • Neurology

    • Metabolic Disorders

    • Infectious Diseases

    • Others

  • Regional Outlook (Revenue, USD Million, 2017 - 2030)

    • North America

      • U.S.

      • Canada

    • Europe

      • U.K.

      • Germany

      • France

      • Italy

      • Spain

    • Asia Pacific

      • India

      • Japan

      • China

      • Australia

      • South Korea

    • Latin America

      • Brazil

      • Mexico

      • Argentina

    • Middle East & Africa

      • South Africa

      • Saudi Arabia

      • UAE

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