Global Pharmaceutical Contract Development and Manufacturing Organization (CDMO) Market Grows Steadily at a CAGR of 6.9%

Introduction

Pharmaceutical contract development and manufacturing organization (CDMO) is a specialized service provider that offers comprehensive support to pharmaceutical companies, covering drug development, manufacturing, and packaging. CDMOs facilitate the entire drug development process, from preclinical formulation to large-scale production, while ensuring regulatory compliance. By outsourcing these functions, pharmaceutical companies can enhance efficiency, reduce costs, and accelerate time-to-market for their products.

Expansion of clinical trials drives demand for CDMO expertise

The increasing number of clinical trials is significantly driving demand for pharmaceutical CDMO services, primarily due to the complexities involved in drug development. Many pharmaceutical companies lack the necessary resources and expertise for manufacturing and regulatory compliance, making CDMOs vital partners.

Moreover, they provide specialized services, including formulation development, clinical trial material production, and quality assurance, helping drug developers accelerate timelines, reduce costs, and manage risks.

• For instance, 2023 data from ClinicalTrials.gov showed around 477,237 registered clinical studies, highlighting the critical support CDMOs offer in the drug development process.

Leveraging process automation in CDMO operations

The adoption of process automation presents a transformative opportunity for pharmaceutical CDMOs, enhancing production efficiency and reliability. By utilizing advanced software, sensors, and PLCs, CDMOs can optimize manufacturing workflows, minimize human error, and boost productivity.

• For example, Pfizer's implementation of automated monitoring in its COVID-19 vaccine production demonstrates how real-time data analysis can swiftly detect variances and halt production if needed.

This approach not only ensures high product quality but also lowers operational costs and accelerates timelines, enhancing the competitiveness of CDMOs in the supply chain.

The North American pharmaceutical Contract Development and Manufacturing Organization (CDMO) market is the largest globally, significantly influenced by the presence of major pharmaceutical and biotechnology companies. This concentration leads to considerable investments in biopharmaceutical research and development, driven by a rising demand for innovative therapies, particularly in cell and gene therapies. However, the U.S. market faces challenges, including drug shortages caused by production delays, discontinuations, and quality control issues, highlighting the need for more robust manufacturing solutions.

In contrast, the Asia Pacific region is witnessing rapid growth in the CDMO sector, fueled by lower operational costs and an increasing prevalence of chronic diseases such as diabetes and heart conditions. This rising demand for new therapies prompts pharmaceutical companies to outsource research and manufacturing activities to CDMOs. Moreover, the trend of privatizing clinical trials is enhancing research outsourcing in developing nations like China and India, further propelling the CDMO market's expansion in this region.

• The global pharmaceutical contract development and manufacturing organization (CDMO) market size was valued at USD 200.9 billion in 2024 and is projected to reach USD 378.94 billion by 2033, exhibiting a CAGR of 6.9% during the forecast period (2025-2033).
• Based on the service type-CMO Segment, the market is divided into drug development services, pharmaceutical manufacturing services, biologics manufacturing services, packaging & labeling services, fill-finish services, and others. The pharmaceutical manufacturing services segment owns the highest market share.
• Based on the research phase-CRO segment, the global pharmaceutical contract development and manufacturing organization (CDMO) is segmented into pre-clinical, phase I, phase II, phase III, and phase IV. The Phase III segment is the largest revenue contributor to the market.
• Based on end-users, the market is segmented into big pharmaceutical companies, small & mid-sized pharmaceutical companies, generic pharmaceutical companies, and others. The big pharmaceutical companies segment is the largest revenue contributor to the market.
• North America is the most significant market

Competitive Players

Recent Developments

• In May 2024, Eli Lilly announced a USD 5.3 billion investment to expand its Lebanon, Indiana site, increasing its total investment to USD 9 billion for producing APIs for Zepbound and Mounjaro.
• In January 2024, EXO Biologics SA launched ExoXpert, a CDMO for GMP exosome production, utilizing its ExoPulse platform to meet the demand for rare disease treatments.

Segmentation

1. By Service Type
   1. Drug Development Services
   2. Pharmaceutical Manufacturing Services
      1. Pharmaceutical API Manufacturing Services
      2. Pharmaceutical FDF Manufacturing Services
   3. Biologics Manufacturing Services
      1. Biologics API Manufacturing Services
      2. Biologics FDF Manufacturing Services
   4. Packaging & Labelling Services
   5. Fill-finish Services
   6. Others
2. By Research Phase
   1. Pre-clinical
   2. Phase I
   3. Phase II
   4. Phase III
   5. Phase IV
3. By End-User
   1. Big Pharmaceutical Companies
   2. Small & Mid-Sized Pharmaceutical Companies
   3. Generic Pharmaceutical Companies
   4. Others