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Projections Suggest Pharmaceutical Contract Manufacturing Market to Reach $140 Billion by 2030

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The global pharmaceutical contract manufacturing market is poised to reach $140 billion by the beginning of the next decade, with an anticipated growth rate of 6.5% during the forecast period from 2022 to 2030, according to a recent report by Roots Analysis. The industry is witnessing a surge in outsourcing development and manufacturing operations due to the challenges and resource-intensive nature of establishing independent capabilities. This trend is notably influenced by the demand for safer and more effective drugs, a demand accelerated by the COVID-19 pandemic.

The current landscape of the pharmaceutical contract manufacturing market offers compelling advantages such as reduced time-to-market, cost benefits, and access to innovative technologies. Mergers and acquisitions are shaping the industry as companies strive to provide comprehensive services from early development to commercial production. Key drivers for the sector include the quest for cost-effective drug production, the adoption of advanced technologies, and a strategic focus on outsourcing to streamline drug development processes. However, the strengths of the industry face challenges, including high initial investment costs and dependence on the reliability of contract manufacturing organizations (CMOs).

Dynamics Shaping the Pharmaceutical Contract Manufacturing Market

A recent report by Technavio further supports the growth trajectory, estimating that the market will expand to $58 billion by 2027, with North America accounting for 41% of this growth. The report attributes this growth to the increasing demand for effective and cost-efficient solutions in the production of pharmaceutical products, particularly those requiring specialized formulations and production methods not available in-house for drug companies.

The report also provides insights into specific segments of the pharmaceutical contract manufacturing market. By 2030, application programming interface (API) is expected to capture 64% of the revenue share, with originator APIs and injectables leading in their respective segments. Commercial operations, small pharmaceutical companies, and the Asia-Pacific region are projected to dominate their categories.

Pharmaceutical Contract Manufacturing Market

Demerger, Expansion, and Acquisition Reshape Pharmaceutical Contract Manufacturing Market Landscape

Recent developments in the industry include notable announcements and actions by key players. Strides Pharma, in September, announced the demerger of its Contract Development and Manufacturing Organization (CDMO) and soft gelatin businesses. In October, Egis Pharmaceuticals expanded its drug substance contract development and contract manufacturing services in Hungary. Another significant move in October involved Advent International and Warburg Pincus completing the acquisition of Baxter International’s BioPharma Solutions business, establishing it as a standalone CDMO.

The report emphasizes that the pharmaceutical contract manufacturing industry can achieve sustainable growth by addressing financial barriers and fostering improved partnerships with reliable CMOs. The growing demand for outsourcing solutions, coupled with technological advancements, positions the industry for substantial expansion in the coming years.

 

Resource: Pharmexec, January 15, 2024

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