Biopharmaceutical Contract Manufacturing Market Size, Share & Trends Analysis Report By Product (Finished Dosage Form, Active Pharmaceutical Ingredients (APIs)), By Biologics (Monoclonal Antibodies (mAbs), Vaccines, Others), By Expression System (Mammalian, Non-Mammalian), By Scale of Operation (Commercial, Research (Clinical and Preclinical)), By Company Size (Large and Very Large Companies, Small and Mid-sized Companies) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Market Overview

The global biopharmaceutical contract manufacturing market was valued at USD 17.20 billion in 2022. It is estimated to reach USD 26.46 billion by 2031, growing at a CAGR of 4.90% during the forecast period (2023–2031).

Biopharmaceutical manufacturing is characterized by advanced technology and new scientific advances driven by complex research and development (R&D) companies. A company that offers contract-based services for drug research and manufacturing to the pharmaceutical industry is known as a contract manufacturing organization (CMO) or contract development and manufacturing organization (CDMO). Pharmaceutical and biopharmaceutical manufacturing companies can give priority to their internal competencies and free up internal resources needed to increase process efficiency by outsourcing the manufacturing process.

Market Dynamics

Global biopharmaceutical contract manufacturing market drivers

Surge in manufacturing capacity expansion post-covid by cdmos and cmos

Biopharmaceutical manufacturing facilities continue to grow as CMOs expand their manufacturing capacities post-covid. Capital investments in biomanufacturing that remain active areas of CDMOs/CMOs in both traditional and new modalities are increasing. With this expansion, companies are expanding the manufacturing capacities of various biopharmaceutical projects by adding GMP production lines. For instance, in November 2021, WuXi Biologics completed its first GMP production on the new 24,000-liter line of Drug Substance Facility MFG5 in WuXi, China. 

Biopharmaceutical manufacturers are outsourcing more activities, which is expected to increase at a medium scale. At the same time, the outsourcing budget has grown in recent years and is making up for what the recession took away. Contract manufacturers are working to meet this demand, with industry players of various sizes and regions securing investment and laying the foundation for new facility expansions. Thus, the surge in manufacturing capacity expansion post-covid by CDMOS and CMOS drive the market growth.

Expansion of biopharmaceutical manufacturing service offerings

Initially, the biopharmaceutical CMOs required to submit operational and product license applications, which shifted to the current format of a Biologics License Application (BLA). As a result, CMOs are typically formed as stand-alone service providers that rent out production capacities to their customers. Some early biopharmaceutical CMOs emerged as spin-offs of product companies that accumulated excess totals.

Additionally, CMOs are now providing customers with earlier development support, which offers fully integrated services with specialized services, such as aseptic filling and finishing. Leading biopharmaceutical manufacturers are also moving to CDMOs for their product developments. Many CDMOs are offering complete services from DNA to fill-finish products. These include formulation, process, and drug product development, thereby driving market growth.

Global biopharmaceutical contract manufacturing market restraint

High cost of treatment 

Biopharmaceuticals are medicines made from living cells that treat common and severe diseases, such as cancer, diabetes, rheumatoid arthritis, and other inflammatory diseases. They are costly, with an average cost of USD 10,000 to USD 30,000 per year, and they can exceed USD 500,000 for most expensive biologics. Unfortunately, most patients cannot afford biologics. Expensive biological products are not easily accessible to poor patients. This is more pronounced in low- and middle-income countries. As a result, the high cost of most biopharmaceutical products is slowing the market's growth over the next few years.

Global biopharmaceutical contract manufacturing market opportunities

Mergers and acquisitions among biopharmaceutical manufacturers

Mergers and acquisitions (M&As) are now among the primary responsibilities of CMOs. TA number of M&A transactions, some of which are quite significant, have taken place in the pharmaceutical contract manufacturing business over the past ten years. Between the 2015 and 2017 period, the overall pharmaceutical CMOs industry witnessed 130 acquisitions of service providers. The majority of purchases targeted CMOs focused on APIs, dose, and analytical services. In addition, around 70% of acquirers were strategic, indicating that they were operating companies rather than investment firms. A few CMOs changed ownership because of the purchase of their parent company, while many CMOs were acquired by pharma/biotech companies seeking to secure their product supply.

M&As of companies and manufacturing facilities have recently been a high-profile feature of the pharma/biotech CMOs industry. M&A deals consistently receive more coverage in the biopharmaceutical industry news media, with speculations surrounding deal valuations, strategic intent, and, most importantly, companies following potential targets being debated continuously in the industry. Thus, M&As among biopharmaceutical contract manufacturing companies create lucrative opportunities for the market to grow.

Regional Analysis

By region, the global biopharmaceutical contract manufacturing market is divided into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa.

North america dominates the global market

North America is the most significant shareholder in the global biopharmaceutical contract manufacturing market and is anticipated to grow at a CAGR of 14.65% during the forecast period. Significant investments made by companies in R&D to strengthen their pipelines for chronic autoimmune diseases are projected to boost the launch of novel therapeutics in North America. Over some decades, steroids and NSAIDs were at the front for treating inflammatory diseases. However, the emergence of innovative molecules and biosimilars has dramatically benefited patients in this region. In addition, the participation of various public and private organizations that aim to educate patients and physicians about inflammatory diseases and boost the R&D in disease management is changing the dynamics of therapies. For instance, the Leona M. and Harry B. Helmsley Charitable Trust is a US-based organization that invests in research to identify novel therapies for Crohn's disease and aims to accelerate the development of innovative treatments.

Europe is estimated to grow at a CAGR of 14.47% over the forecast period. The increasing elderly population and the prevalence of autoimmune diseases, respiratory disorders, and cancer are increasing the demand for biopharmaceuticals and are expanding the biopharma and biotech industries. These significant factors also contribute to the growth of biopharmaceutical contract manufacturing in Europe. More significant investments due to the high focus of government bodies on R&D across Europe are driving the biopharmaceutical outsourcing industry. In the European region, non-communicable diseases which cause inflammations account for about 60% of deaths. In addition, the European healthcare system strengthens people-centered health systems by signing and forming the Tallinn Charter, prioritizing continual quality treatments and delivery systems.

In Asia-Pacific, non-communicable diseases (NCDs) are a leading cause of mortality and morbidity in this region. The prevalence and incidence of these NCDs are increasing, especially in rapidly countries such as China and India. The United Nations Population Fund (UNFPA) states that the world's aging population is growing at a rate that has never been seen before and that this region is the leader in this trend. In Asia-Pacific, one in four people will be over 60 by 2050. Thus, the region's older population will triple, reaching 1.3 billion by 2050. Furthermore, the increasing prevalence of diseases, including inflammatory bowel diseases, colorectal cancers, bladder cancer accident-related injuries, and the aging population, are a few of the significant factors driving the biopharmaceutical contract manufacturing market in the region.

Infectious diseases are still present in Latin America, but demographic and epidemiological shifts have progressed far; as a result, non-communicable diseases now account for the region's vast majority of health concerns. Several factors are responsible for the resurgence of infectious diseases, which include human demographics, environmental changes, emerging resistance by microbes, and disease outbreaks. In addition, tuberculosis is considered a primary emerging disease in this region, similar to other developing countries. Other top infectious diseases that constantly affect the Latin American population include Hemophilus influenza type b, Hepatitis B, whooping cough, meningococcal meningitis, tetanus, yellow fever, diphtheria, and measles. As growing infectious diseases increase the vaccine demand through immunization coverages, contract manufacturers will likely observe opportunities in this market. 

Segmental Analysis

The global biopharmaceutical contract manufacturing market is segmented by products, biologics, expression systems, scale of operation, and company size.

By products, the global market is divided into finished dosage form and active pharmaceutical ingredients (APIs). 

The finished dosage form segment is responsible for the largest market share and is anticipated to grow at a CAGR of 14.79% over the forecast period. A finished dosage form is a drug product that has undergone all the production steps, including manufacturing, testing, and approval for use, before being delivered to the general public. The FDF includes active pharmaceutical ingredients (APIs), which are in response to the effects the user experiences after taking the dosage forms, and inactive ingredients (excipients), which act as a vehicle for the active ingredients to function. The FDF is a crucial stage in the life cycle of a product and can only be attained by a pharmaceutical firm or an organization that outsources manufacturing having high-quality manufacturing facilities. This is the primary justification given by businesses that do not have a typical FDF manufacturing facility for licensing.

By biologics, the global market is segmented into monoclonal antibodies (mAbs), vaccines, and others. 

The monoclonal antibodies (mAbs) segment owns the highest market share and is expected to grow at a CAGR of 16.33% over the forecast period. Human blood contains antibodies that help us fight illnesses naturally. In mAb treatments, natural antibodies are essentially duplicated in a lab setting. Clones of a single antibody make up monoclonal antibodies. Each mAb is a collection of the same kind of antibody. For the treatment of cancer, a wide variety of mAbs are available. They function differently, some in more than one way. 

As widely reported, the first case of COVID-19 infection was first observed in China in late 2019, and this highly contagious and often deadly virus caused a pandemic. The virus has mutated multiple times, resulting in so-called concern variants, and some are more susceptible to infection than the original virus. The pandemic activated many issues in finding and making antibody therapies to stop and treat COVID-19. As of November 2021, seven virus-targeting antibody products developed as monotherapy or in combination with anti-SARS-CoV-2 mAb received regulatory approval or Emergency Use Authorization (EUA).

By expression system, the global market is divided into mammalian and non-mammalian.

The mammalian segment is the highest contributor to the market and is anticipated to grow at a CAGR of 14.89% over the forecast period. The creation of transgenic mammalian cell lines into biopharmaceuticals continues to be a vital component of the biotechnology and pharmaceutical industries. Since the successful introduction of human tissue plasminogen activator in 1987 and erythropoietin in 1988, the biopharmaceuticals market has grown exponentially. About ten years ago, microbial fermentation relied heavily on the production of recombinant proteins. Since then, the efficiency of cell culture has improved significantly. As a result, by 2018, nearly 70% of biological production capacity (excluding blood/plasma products) was primarily based on mammalian cell culture in Chinese Hamster Ovary (CHO) cells. 

In addition, the majority of candidates for the biopharmaceutical pipeline are biopharmaceuticals expressed in mammals. As a result, pharmaceutical corporations and contract service providers invest in more cell culture manufacturing capabilities, smaller-footprint surveillance systems, and productivity-enhancing solutions.

By the scale of operation, the global market is segmented into commercial and research (clinical and preclinical). 

The commercial segment owns the highest market share and is anticipated to grow at a CAGR of 14.51% over the forecast period. The challenge of producing a billion doses of biotechnology goods in a matter of months is huge, given the rise of infectious diseases, the development of epidemics, and pandemics. Large-scale production of drug substances and products, clinical testing schedules with several phases, and small-scale manufacturing for clinical trials are all extremely difficult undertakings with constraints. However, due to its broad limitations, large-scale drug substance manufacturing involves complex tasks. These challenges can be overcome by fast-tracking regulatory processes and using rapid-response manufacturing platform technologies.

By company size, the global market is divided into large and very large companies and small and mid-sized companies. 

The large and very large company segment is the highest contributor to the market and is estimated to grow at a CAGR of 14.41% over the forecast period. Biopharmaceutical companies rely on CMOs to provide capacity and functionality as needed. In some cases, CMOs have provided most of the production for companies. CMOs help biopharmaceutical companies focus on the higher-value parts of value chains. For large biotechnology companies with already sophisticated manufacturing and regulatory functionalities, CMOs are comparable to other value propositions made to tiny biotechnologies. In addition, a manufacturing process that is likely to become commoditized and may not offer a competitive edge may not be worth the vast companies' resources. Thus, a partnership with a CMO can allow the large company to focus on parts of the biotechnology value chain.

Recent Developments

• December 2022- Pfizer Inc. stated that the U.S. Food and Drug Administration (FDA) had accepted a Biologics License Application (BLA) for its investigational pentavalent meningococcal vaccination candidate for review (MenABCWY). Pfizer made MenABCWY to protect people ages 10 to 25 from meningococcal disease caused by the most common serogroups.
• January 2023- Forge Biologics and Oculogenex announced an AAV contract development and manufacturing partnership.