A contract development and manufacturing organization manages the discovery and invention of novel pharmacological compounds and their outsourced production. The small molecule innovator CDMO is a pharmaceutical industry that offers contract services for producing and developing small molecule medicines. Small molecule drugs are typically synthesized organic compounds with a molecular weight below 900 Daltons. CDMOs offer pharmaceutical and biotech companies various services, including drug discovery, process development, analytical testing, and commercial manufacturing. These services are delivered on a contractual basis, enabling client companies to delegate the creation and production of their pharmaceuticals while focusing on other aspects of their business, such as research, marketing, and sales.
Small molecule applications account for more than half of specialty sales. Specialty medicines are increasingly propelling global pharmaceutical growth, particularly in developed markets, where they account for over half of sales. In 2020, small molecule pharmaceuticals dominated the approval of new molecular entities (NMEs). Small molecules constituted approximately 75% of the 53 NMEs certified in 2020. According to Pharm Source, the revenues of publicly traded Contract Development & Manufacturing Organizations (CDMOs) and CMOs specializing in developing and manufacturing small molecule pharmaceuticals rose by 15% during the first half of 2015, with some companies reporting revenue increases of over 20%. Both biopharmaceutical and small molecule methodologies have a history of providing significant therapeutic benefits to patients. Therefore, the increasing demand for small-molecule pharmaceuticals is anticipated to fuel market expansion.
According to the Congressional Budget Office, the U.S. pharmaceutical industry spent USD 83 billion on pharmaceutical research and development, ten times more than in the 1980s. The Congressional Budget Office of the United States also reported that the sale of approved new medicines increased by 60% from 2010 to 2019, with 59 new drugs approved in 2018. Numerous biopharmaceutical companies are electing to outsource their R&D activities, whether it be the production of novel monoclonal antibodies, small molecules, or protein products for rapid market commercialization. The rising incidence 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 creating growth opportunities.
Asia-Pacific is the most significant global small molecule innovator CDMO market shareholder and is anticipated to exhibit a CAGR of 7.61% during the forecast period. The Asia-Pacific healthcare industry is consistently evolving and expanding due to technological advances and low service costs. China retains the largest market share in Asia-Pacific due primarily to its high investment in pharmaceutical R&D. Additionally, a growing regulatory emphasis on product quality control is anticipated to be one of the main factors driving the market during the forecast period. Regulatory organizations in Asia-Pacific include the Therapeutic Goods Administration (TGA) in Australia, the Ministry of Food and Drug Safety (MFDS) in South Korea, the Pharmaceuticals and Medical Devices Agency (PMDA) in Japan, and the Singapore Health Sciences Authority (HSA) in Singapore. The region is anticipated to experience advantageous growth opportunities due to its market dominance.
North America is estimated to exhibit a CAGR of 6.2% over the forecast period. North America is one of the prominent contributors to expanding the Contract Development & Manufacturing Organization (CDMO) market for small molecule innovators. Several well-established pharmaceutical, biotechnology, and medical device companies characterize it. In addition, rising R&D expenditures by pharmaceutical and life sciences companies are anticipated to increase the region's contract manufacturing demand. In addition, the increasing prevalence of cancer, diabetes, and cardiovascular disorders in the region will likely increase demand for CDMO services to develop medications or medicines. It is anticipated that stringent regulations governing product development, production, and quality control will create growth opportunities for domestic contract manufacturing services.
The key global small molecule innovator CDMO market players are Cambrex, Recipharm, Thermo Fisher Pantheon, Corden Pharma, Lonza, Catalent, Siegfried, Piramal Pharma Solutions, Boehringer Ingelheim, Wuxi AppTec, Almac, and Covance.