Contract development and manufacturing organization (CDMO), also known as contract manufacturing organization (CMO), is a company that provides services to other companies in the pharmaceutical industry on a contract basis range from drug development to drug manufacturing. On the other hand, the CDMO is a combination of development and manufacturing of pharmaceutical products by different companies on a contractual basis that are constrained by a certain set of standards and rules that each company must need to adhere.
In this context, all the pharmaceutical companies act as outsourcing companies that deal with the manufacturing and development of drugs that lead to improved business scalability and revenue. Also, many companies are significantly investing in these services, as it inherently provides cost-saving and time-saving benefits resulting in a maximum stake of outsourcing revenue. As such, the need for pharmaceutical contract development and manufacturing treatment is gaining significant momentum in recent years to deliver value-added services for a risk-sharing or integrated business model.
The growth in investments and spending on pharmaceutical research and development (R&D) coupled with the increasing pressure on healthcare providers to reduce healthcare costs is expected to propel the market growth. Furthermore, the rising demand for generics medicine and biologics to improve the therapeutic effectiveness and safety profiles for the health conditions will further enhance the demand for pharmaceutical contract development and manufacturing market globally.
However, the limited outsourcing activities among well-established pharma companies’ customers, along with regulatory complications associated with the drug approval are the few factors that may hamper the market growth during the forecast period. Moreover, the growing demand for cell and gene therapies is expected to fuel the penetration of the pharmaceutical contract development and manufacturing market during the forecast period.
Mounting Pressure on Pharmaceutical Providers to Reduce Healthcare Costs
As the current market trend, the healthcare sector requires to deliver improved patient care and enhance the patient’s experience from the initial stage of the diagnosis till the recovery phase within or outside the healthcare organizations. Through which pharmaceutical companies are opting for pharmaceutical outsourcing services that can free an organization to concentrate on non-critical tasks and help them to focus resources on core competencies, which further leads to the significant reduction of overall healthcare cost.
As per the Insight customer call solution LTD, the appointment of BPO in the pharmaceutical and healthcare industries may lead to saving the additional cost of up to 30-60%. As such, the utility of pharmaceutical outsourcing and manufacturing activities have a prominent role in the reduction of healthcare costs.
Moreover, many automated solutions complied with complete software & skilled professionals that helps in managing efficient development of drugs and medicines, which further reduce the cost of hiring additional staff, training them, and investment cost of another related resource. As a result, the inclined pressure on healthcare providers to lower healthcare costs is expected to drive the growth of the market over the forecast years.
Based on geography, the study analyzes the pharmaceutical contract development and manufacturing market in the global market, including North America, Europe, Asia-Pacific, South America, and the Middle East & Africa.
North America leads the global market throughout the forecast period
North America dominates the global pharmaceutical contract development and manufacturing market in terms of value and volume due to the rise in the number of leading pharmaceutical manufacturing companies and easy accessibility of high-quality pharmaceutical products for healthcare facilities across the region. It is also leading as a consequence of significant expansion that has been made in the U.S. healthcare industry, which, in turn, accelerates the market growth in the region. While in Europe, the rising number of clinical trials and robust growth in the generics industry are the few factors expanding the scope of the global pharmaceutical contract development and manufacturing market in the coming years.
The Asia Pacific is estimated to grow at the pharmaceutical contract development and manufacturing market's highest growth rate during the forecast period. The growth of the region is attributed to the increasing number of mergers & acquisitions between Asia-based companies and other international key players, along with improving pharmaceutical facilities in the region. Also, the global companies are investing a substantial amount of funds to increase the export from the low-cost area, which is further likely to increase the pharmaceutical contract development and manufacturing diagnostic products in the domestic region during the forecast period.
Competitive Landscape
The pharmaceutical contract development and manufacturing market is highly competitive, owing to the presence of big pharmaceutical brands. The key Pharmaceutical contract development and manufacturing players which are contributing to the growth of the global market include Lonza Group, Thermo Fisher Scientific Inc., Catalent, Recipharm AB, ABBVIE, Siegfried Holding AG, Evonik Industries, Boehringer Ingelheim, Piramal Pharma Limited, Fujifilm Healthcare, Asymchem Laboratories (Tianjin) Co., Ltd., WuXi AppTec, among others.
The major players are adopting new product launch and expansion strategies for global growth in the Pharmaceutical contract development and manufacturing market.
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