Global Active Pharmaceutical Ingredients CDMO Market Grows Steadily at a CAGR of 6.5%

Introduction

The active pharmaceutical ingredient (API) is the component of medicine that creates the desired effect when used to diagnose, treat, alleviate, or prevent disease or to alter the structure or function of a human or animal. API production is a complex, specialized process that requires the integration of chemistry, biology, and engineering. A contract development and manufacturing organization is a pharmaceutical industry company or organization that provides medication development and manufacturing services. Pharmaceutical companies collaborate well with CDMOs to outsource drug development and production. The quality of active pharmaceutical ingredients considerably impacts the efficacy and safety of medications.

Market Dynamics

Increasing Pharmaceutical R&D Investments Drive the Global Market

According to the Congressional Budget Office, the U.S. pharmaceutical sector spent USD 83 billion on pharmaceutical research and development, ten times more than in 1980. This investment in research and development is propelling biopharmaceutical businesses to develop novel medicines and cures. Several biopharmaceutical companies are outsourcing their R&D efforts for rapid market commercialization, including developing innovative monoclonal antibodies, small chemicals, and protein products. The increasing prevalence of chronic diseases, the introduction of biologics and biosimilars, and the expansion of government initiatives to stimulate the pharmaceutical industry are among the factors that are expected to increase pharmaceutical R&D spending globally, thereby driving market expansion.

Expanding Consumption of Biopharmaceuticals Creates Tremendous Opportunities

The demand for API CDMO is anticipated to increase as markets for biologics, biosimilars, orphan pharmaceuticals, personalized medicine, companion diagnostics, and adaptive trial design expand. As businesses expand into additional industries, the necessity to comply with regulations increases, driving demand for contract development and manufacturing specialists. The development of biological drugs has mitigated concerns over the usage of conventional synthetic medications. These synthetic medications are made from synthetic substances that are not typically found in the human body and have the potential to cause adverse side effects. Hence, biopharmaceutical companies are using biological methods in order to develop biologics for more than 100 ailments.

Regional Analysis

Asia-Pacific is the most significant shareholder in the global active pharmaceutical ingredients CDMO market and is anticipated to grow at a CAGR of 8.7% during the forecast period. The Asia-Pacific market for CDMOs of active pharmaceutical ingredients is expected to grow more over the forecast period, owing to the expanding breadth of opportunities, particularly in China, Japan, and India. The region's market is anticipated to be driven by factors such as an enhanced regulatory environment, a significant potential for cost savings, greater complexity, and a solid pharmacological pipeline. In addition, the availability of trained labor at a lower price than in established nations such as the United States is predicted to drive the market. Growing regulatory emphasis on quality control for manufacturing is projected to be one of the primary market drivers over the forecast period.

North America is estimated to grow at a CAGR of 3.9% over the forecast period. Several well-established biotechnology and pharmaceutical companies have contributed to North America's success worldwide. In addition, rising R&D expenditures by life sciences and pharmaceutical businesses are expected to drive demand for API contract manufacturing in the region. Strict manufacturing and product quality standards are anticipated to generate growth prospects for domestic contract manufacturing services. The United States maintains the biggest market share in North America and is predicted to grow considerably over the forecast period. Furthermore, pharmaceutical companies' expansion of outsourcing methods and the contribution of CDMOs to reducing operational and capital expenses are primarily responsible for their profitable expansion.

Key Highlights

• The global active pharmaceutical ingredients CDMO market was valued at USD 93.42 billion in 2022. It is estimated to reach USD 164.65 billion by 2031, growing at a CAGR of 6.5% during the forecast period (2023–2031).
• Based on product, the global active pharmaceutical ingredients CDMO market is divided into traditional API, HP-API, antibody-drug conjugate, and others. The traditional API segment is responsible for the largest market share and is anticipated to grow at a CAGR of 4.4% over the forecast period.
• Based on synthesis, the global active pharmaceutical ingredients CDMO market is segmented into synthetic and biotech. The synthetic segment owns the highest market share and is estimated to grow at a CAGR of 6.4% during the forecast period.
• Based on drugs, the global active pharmaceutical ingredients CDMO market is bifurcated into innovative and generic. The innovative segment is the highest contributor to the market and is projected to grow at a CAGR of 5.8% over the forecast period.
• Based on application, the global active pharmaceutical ingredients CDMO market is divided into oncology, hormonal, glaucoma, cardiovascular, diabetes, and others. The oncology segment is responsible for the largest market share and is estimated to grow at a CAGR of 7.0% over the forecast period.
• Based on workflow, the global active pharmaceutical ingredients CDMO market is segmented into clinical and commercial.The commercial segment owns the highest market share and is expected to grow at a CAGR of 6.4% over the forecast period.
• Asia-Pacific is the most significant shareholder in the global active pharmaceutical ingredients CDMO market and is anticipated to grow at a CAGR of 8.7% during the forecast period.

Competitive Players

Competitive Players

The key players in the global active pharmaceutical ingredients CDMO market are Cambrex Corporation, Recipharm AB, Thermo Fisher Scientific Inc. (Pantheon), Corden Pharma International, Samsung Biologics, Lonza Group, Catalent, Inc., Siegfried Holding AG, Piramal Pharma Solutions, and Boehringer Ingelheim.

Recent Developments

Market News

• In February 2023, Lonza will establish a new laboratory in Cambridge, Massachusetts, as part of the Swiss CDMO's strategy to grow its early development services (EDS) segment in North America.
• In February 2023, Piramal Pharma Solutions, a division of Piramal Pharma Ltd that focuses on patients and is a Contract Development and Manufacturing Organization (CDMO), commenced making the first batches of active pharmaceutical ingredients (APIs) in brand-new reactor suites at its US facility in Riverview, Michigan.

Segmentation

Global Active Pharmaceutical Ingredients CDMO Market: Segmentation

By Product

• Traditional API
• HP-API
• Antibody Drug Conjugate
• Others

By Synthesis

• Synthetic
• Biotech

By Drug

• Innovative
• Generics

By Applications

• Oncology
• Hormonal
• Glaucoma
• Cardiovascular Disease
• Diabetes
• Others

By Workflow

• Clinical
• Commercial

By Regions

• North America
• Europe
• Asia-Pacific
• Latin America
• The Middle East and Africa