Published Date : 16 Jan 2024
The global biopharmaceutical CMO and CRO market size surpassed USD 36.01 billion in 2023 and is projected to attain around USD 62.93 billion by 2032, growing at a CAGR of 6.40% from 2023 to 2032.
Biopharmaceutical contract manufacturing organizations (CMOs) and contract research organizations (CROs) provide outsourcing services to the biopharmaceutical industry. They help pharmaceutical and biotech companies needing more expertise, facilities, or resources. These organizations offer various services, including contract development and manufacturing of biologics, process development and optimization, analytical testing, and regulatory support. Challenges such as the complexity of biological substances, the need for specialized skills and tools, and the desire to reduce costs and increase efficiency affect the industry.
The market for biopharmaceutical CMOs and CROs is expected to grow significantly in the coming years, driven by several key factors. A significant factor is the growing trend of pharmaceutical companies outsourcing their drug research and production to focus on core competencies and reduce costs. In addition, growing biologics and biosimilars requires specialized manufacturing expertise that many companies may need to gain. Expanding into new markets will further support this expected growth, particularly in Asia, where the demand for high-quality biopharmaceutical services is increasing.
North America holds the largest biopharmaceutical CMO and CRO market share during the forecast period. This is due to increased chronic diseases, demand for generics and biologics, biosimilars, and investment in the biopharmaceutical industry.
US CMOs have expanded their services from core manufacturing to full range to meet market and outsourcing needs. The US pharmaceutical industry and continued growth and the growing trend of large pharmaceutical companies outsourcing profit margins while concentrating on their core competencies are driving the market in the country. In addition, the Canadian pharmaceutical industry is growing significantly, supported by Canada's business-friendly environment and government initiatives; the pharmaceutical industry is known for its innovation, making it an essential part of the Canadian economy.
| Report Coverage | Details |
| Market Revenue in 2023 | USD 36.01 Billion |
| Projected Forecast Revenue by 2032 | USD 62.93 Billion |
| Growth Rate from 2023 to 2032 | CAGR of 6.40% |
| Largest Market | North America |
| Base Year | 2022 |
| Forecast Period | 2023 to 2032 |
| Regions Covered | North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa |
Drivers
Mergers and collaborations
There have been many mergers in the biopharmaceutical industry in recent years, and the contract manufacturing and service sector is set to expand due to these mergers. The emergence of new drugs, advances in bioprocessing methods, and the changing bio/pharma landscape are expected to pressure contract biomanufacturers. Alternative business models are introduced to meet the demands of stakeholders and customers.
Global market collaborations
The global biopharmaceutical CMO and CRO market is growing due to the trend of outsourcing in the biopharmaceutical industry. Operated by Baxter's BioPharma Solutions (BPS) business unit, the facility collaborates with leading pharmaceutical and biotechnology companies to develop and contract pharmaceutical products, particularly injectable drugs.
This trend is driven by the increasing prevalence of cancer and age-related diseases, global generic production capacity growth, and biologics development. As a result, industry players are focusing on developing biological APIs and expanding their API manufacturing capabilities. These developments create favorable opportunities for CMOs in the biopharmaceutical and small molecule API sectors. This trend is expected to continue and even strengthen during the forecast period.
Restraint
Stringent regulatory practices
One of the significant challenges expected to hinder the growth of the global biopharma CMO and CRO market is strict rules and regulations. A regulatory framework regulated explicitly by the Food and Drug Administration (FDA) creates and oversees CROs. The FDA can hold these CROs directly responsible for the sponsor's obligations concerning the investigational new drug application. Ensuring that clinical trials are appropriately managed and that good clinical practice and harmonization guidelines are followed is critical to the CRO. Despite these regulatory challenges, there is a growing interdependence between CMOs and CROs to improve productivity and efficiency.
Opportunities
Growing prevalence of chronic conditions
The increasing global incidence of chronic diseases presents significant growth opportunities for biopharma CMO and CRO market players. The growing burden of chronic diseases has led to a rising demand for safe and effective medicines, which has accelerated the process of drug discovery and development.
Preference for personalized medications
The advent of personalized medicine has made the traditional one-size-fits-all model obsolete. In response to industry efforts to make clinical trials more accessible and patient-friendly, technology has become an essential part of contract organizations. To stay competitive and provide complete solutions to clients, CROs are pioneers in implementing the latest technologies and tools. The integration of these advanced technologies has proven to benefit CROs by improving their efficiency and accelerating research, ultimately contributing to the growth of the CRO market.
The rapid expansion of the biopharma industry promises lucrative opportunities for players in the biopharma CMO and CRO markets. The outsourcing trend is also growing with the biopharmaceutical industry's rapid growth. For instance, according to the India Brand Equity Foundation (IBEF), India's biotechnology industry is expected to reach around $150 billion by 2025 and could reach $270-300 billion by 2030. Furthermore, by 2025, India's biotechnology sector will constitute 19% of the global market.
Market Segmentation
By Service
By Source
By Product
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