The U.S. pharmaceutical contract manufacturing market size is expected to reach around USD 84.07 billion by 2033, and it is growing at a CAGR of 6.90% from 2024 to 2033. The pharmaceutical contract manufacturing market is growing rapidly because it offers advantages such as reduced costs, increased production capacity, and the ability to focus on important activities such as drug discovery and marketing.
The pharmaceutical contract manufacturing process involves outsourcing drug manufacturing to third-party manufacturers to produce drugs, which provides flexibility and cost savings. That can provide services such as drug development, manufacturing, and compliance with regulatory requirements. It involves using technologies such as artificial intelligence and machine learning to optimize various stages of drug development and manufacturing. These technologies, which include natural language processing, are used to automate and improve processes in the pharmaceutical industry.
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In pharmaceutical contract manufacturing, distinguish between contract manufacturing organizations (CMOs) and contract development and manufacturing organizations (CDMOs) because both provide different services in the development and manufacturing of drugs, which has led to the rapid growth of the pharmaceutical contract manufacturing market.
For Instance,
· In April 2024, Avenacy announced that it has begun marketing desmopressin acetate injectables in the U.S. as the therapeutic equivalent of its U.S. Food and Drug Administration-approved drug DDAVP (desmopressin acetate). Desmopressin acetate injection has multiple indications and is suitable for patients with diabetes insipidus, hemophilia A, and von Willebrand disease. The company is supported by a global development network and FDA-approved cGMP contract manufacturing partners.
Key Takeaways
· North America has accounted revenue share of 36% in 2023.
· Asia-Pacific is expected to grow at a fastest CAGR during the forecast period.
· By service, the pharmaceutical manufacturing services segment has accounted 33% revenue share in 2023.
· By service, the drug development services segment is growing at a 8.9% of CAGR over the forecast period.
· By end-user, the big pharmaceutical companies segment has captured revenue share of 42% in 2023.
· By end-user, the small & mid-sized pharmaceutical companies segment is expected to expand at the fastest CAGR over the projected period.
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Top Growth Factors in the Pharmaceutical Contract Manufacturing Market
· Cost Saving: One of the biggest benefits of pharmaceutical contract manufacturing is cost savings. Outsourcing production to third-party manufacturing companies helps pharmaceutical companies save on the cost of equipment, labor, and overhead costs associated with production, which leads to the growth of the pharmaceutical contract manufacturing market.
· Access to advanced technology: Access to advanced technology is another advantage. This access ensures that drugs are manufactured using the latest technology, increasing their efficiency and productivity, which in turn leads to the growth of the pharmaceutical contract manufacturing market.
· Flexibility and Scalability: Contract manufacturers can easily adjust production to changing needs, making products competitive in the marketplace. This flexibility is important in managing the life cycle of pharmaceutical products from the beginning to peak demand and eventual decline, which has led to the development of the pharmaceutical contract manufacturing market.
North America dominated the market in 2023
North America has the largest market share as a pharmaceutical contract manufacturing service provider in North America with cutting-edge technology and competitive rates solutions. Pharmaceutical manufacturing involves many services that should be carefully evaluated before deciding on and signing a contract. The companies include Eli Lilly & Co., Vertex Pharmaceuticals Inc., and Switzerland’s BeiGene Inc. The company’s commitment to WuXi AppTec Inc.’s diversified manufacturing process has led to the growth of the pharmaceutical contract manufacturing market.
For Instance,
· In May 2022, The Pharmaceutical Solutions business of Piramal Pharma Limited, a leading contract development and manufacturing organization (CDMO), announced that its new active ingredient (API) process is online and has been completed and construction has initial production runs at the company’s facility in Aurora, Ontario.
· In July 2024, Rusan Pharma Private Limited announced that its active pharmaceutical ingredient (API) manufacturing facility in Ankleshwar, Gujarat has received FDA approval for Good Manufacturing Practice.
Asia-Pacific is poised for rapid growth in near future
Asia-Pacific is poised for rapid growth in the pharmaceutical contract manufacturing market as pharmaceutical, contract manufacturing, and research contracts become the advances for many pharmaceutical companies. Trends in healthcare outsourcing and outsourcing decisions are changing in Asia. Cost reductions are increasing and will gradually be replaced by “footprint growth”, which is the main factor influencing the shaping decision. Asian Contract Manufacturing Organizations (CMOs) are responsible for the expansion of pharmaceutical manufacturing worldwide, which is driving the growth of the pharmaceutical contract manufacturing market.
For Instance,
· In June 2024, India Lupin announced the CEO candidate for the new subsidiary as it moves into the CDMO arena. From a vitamin manufacturer to a pharmaceutical specialist and now a contract manufacturer, Lupin India is moving into a new phase of its business.
Leveraging CDMOs for Enhanced Efficiency
Contract manufacturing organizations (CMOs) and contract development and manufacturing organizations (CDMOs) are important partners for pharmaceutical and biotech companies seeking to optimize their manufacturing processes. CDMOs not only manage the production and packaging of drugs but also play a key role in manufacturing drugs according to customer specifications. This comprehensive approach allows companies to simplify operations, reduce time to market, and focus on core competencies, thereby driving growth in the pharmaceutical contract manufacturing market. By outsourcing these important tasks to a dedicated CDMO, companies can increase efficiency, ensure compliance, and capitalize on innovation in drug development.
Integration with Advanced Technologies
The integration of technologies such as artificial intelligence (AI), machine learning, and automation is creating a significant opportunity for the pharmaceutical contract manufacturing market. These innovations increase efficiency, reduce costs, and accelerate production time while enabling advanced data analytics to drive innovation in drug development and manufacturing.
Additionally, the emergence of the Internet of Things (IoT) is facilitating instantaneous monitoring of production, allowing pharmaceutical companies to monitor their development contracts and manufacturing organizations (CDMOs) remotely. This capability enables effective control and rapid response to operational issues, thus providing transparency and reliability throughout the supply chain. Companies using this technology will therefore gain a competitive advantage in the rapidly evolving pharmaceutical landscape.
Challenges in Pharmaceutical Contract Manufacturing
Although pharmaceutical manufacturing contracts have many advantages, some restrictions can limit the growth of the business. Key issues include the risk of losing control of the manufacturing process, difficulty identifying suitable contract manufacturers, and the complexity of compliance. Performance management issues, adherence to strict deadlines, and the complexity of commitments are important factors to consider when choosing a business partner.
Contracting companies are also required to adhere to the same stringent standards as pharmaceutical companies, including compliance with FDA regulations and good manufacturing practices (GMP). These regulations can create additional challenges that will ultimately impact the flexibility and resilience of the pharmaceutical contract manufacturing market.
Recent Breakthroughs in the Pharmaceutical Manufacturing Market
The partnership of AGC Biologics and BioConnection in Pharmaceutical Manufacturing Market
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Company Name |
AGC Biologics and BioConnection |
|
Headquarter |
United States |
|
Recent Development |
In May 2024, AGC Biologics and BioConnection, a contract manufacturer specializing in the sterilization of vials and syringes for medical and commercial use, announced a new partnership. Under the agreement, the two companies focus on end-to-end biopharmaceutical development and manufacturing capabilities for APIs and pharmaceutical products. |
Acquisition of Blue Wolf Capital and CDMO in
the Pharmaceutical Manufacturing Market
|
Company Name |
Blue Wolf Capital and CDMO |
|
Headquarter |
United States |
|
Recent Development |
In September 2024, Blue Wolf Capital Partners LLC announced that it had completed the acquisition of seven European pharmaceutical companies from its contract development and manufacturing organization (CDMO) Recipharm. |
The Partnership of MedPharm, Ltd and Tergus
Pharma in the Pharmaceutical Manufacturing Market
|
Company Name |
MedPharm, Ltd and Tergus Pharma |
|
Headquarter |
United States |
|
Recent Development |
In July 2024, MedPharm, Ltd., an Ampersand Capital Partners portfolio company, and Tergus Pharma, a Great Point Partners portfolio company, jointly announced a merger. The combined topical and transepithelial Contract Development and Manufacturing Organization (CDMO) will operate under the MedPharm name, establishing a leading, end-to-end CDMO with robust scientific, clinical trial manufacturing, and commercial production capabilities. |
Report Highlights
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By Service |
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By End-user |
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Recent News in the Pharmaceutical Contract Manufacturing Market
· In October 2024, Boehringer Ingelheim launched a monthly disinfection solution for cats in the UAE that provides convenient and effective protection for cats and their owners.
· In April 2024, Pluri launched a manufacturing division as the cell therapy pipeline progresses. Through this, the company is sharing its knowledge base, technology, and facilities with other businesses to develop stem cells, induced pluripotent stem cells, exosomes, and immunotherapeutics.
· In January 2024, Alcami Corporation, a leading contract development and manufacturing organization (CDMO), announced it had completed the acquisition of Pacific Pharmaceutical Services, Inc. ("PPS"), a preferred provider of cGMP pharma storage and service
· In April 2024, Kühne Holding AG signed a definitive agreement to acquire a drug development contract development and manufacturing organization from international investment firm BC Partners and to form the Aenova Group.
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Key Players of the Pharmaceutical Contract Manufacturing Market
· Lonza Group
· Catalent, Inc.
· Patheon (Now part of Thermo Fisher Scientific)
· Recipharm AB
· Boehringer Ingelheim
· Dr. Reddy's Laboratories
· Jubilant Life Sciences
· Fareva
· Vetter Pharma
· Evonik Industries
· WuXi AppTec
· Pfizer CentreOne
· Almac Group
· AbbVie Contract Manufacturing
· Samsung Biologics
Market Segmentation
By Service
· Pharmaceutical Manufacturing Services
· Pharmaceutical API Manufacturing Services
· Pharmaceutical FDF Manufacturing Services
· Drug Development Services
· Biologic Manufacturing Services
· Biologic API Manufacturing Services
· Biologic FDF Manufacturing Services
By End User
· Big Pharmaceutical Companies
· Small & Mid-Sized Pharmaceutical Companies
· Generic Pharmaceutical Companies
· Other End Users (Academic Institutes, Small CDMOs, and CROs)
By Geography
· North America
· Europe
· Asia Pacific
· Latin America
· Middle East and Africa (MEA)
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