The contract research organizations offer outsourced pharmaceutical research services to the pharmaceutical and biotechnology industries. Healthcare CROs function and manage several activities with expertise, using robust facilities, as per the given timeline by the clients.
The organizations offer umpteen services, which include biopharmaceutical development, biologic assay development, commercialization of new entity, marketing approval, preclinical research, clinical research, clinical trials management, and pharmacovigilance. Government and public pharmaceutical and biotech industries assign projects to CROs due to time and cost constraints and highly dynamic patent landscape of the healthcare sector, further driving the market growth.
The healthcare contract research organization (CRO) market was valued at USD 40,056.5 million in 2019 and is expected to grow with a CAGR of 7.2%.
Increasing investments in R&D activities by biopharmaceutical companies and extensive drug pipelines for the treatment of various chronic diseases, such as cancer, cardiovascular disorders, metabolic disorders drive market growth. Advancements in the domain of drug development and medical device industries are subsequently driving the demand for healthcare CROs. Globally, pharmaceutical companies heavily invest in R&D activities, which was about USD 156.7 billion in 2016.
CROs help performs extensive research activities at their in-house trial, saving costs and times for the pharmaceutical companies. Currently, the leading pharmaceutical companies are focusing on developing novel oncology drugs and are performing stem cell research, cancer research, and drug discovery to study different small molecules and their mechanisms in order to develop a robust novel drug product pipeline. Small and medium-sized pharmaceutical and biotechnology companies are emphasizing on conducting novel drug research and clinical trials for their products, further driving the market growth.
The clinical research services segment dominated the healthcare CRO market in 2019. The segment is further segregated into phase I, phase II, phase III, and phase IV clinical research services. The phase III clinical research services segment holds the largest market share due to its significance in the drug development lifecycle. It is an expensive process and accounts for about 90% of the costs incurred during the clinical trial development of novel drugs.
In October 2015, Quintiles, leading clinical research market player, collaborated with IMS health to gain access to Phase III clinical research data in order to attain a maximum number of drug approvals. Quintiles also got access to real-time evidence (RWE) data containing over 400 clinical studies from IMS health.
The drug discovery segment is projected to grow at the fastest rate. The rising prevalence of cardiovascular disorders across the globe prompts the need for swift drug discoveries. Increasing healthcare expenditure and patent expiration of blockbuster drugs provide an impetus to the market growth. In the last few years, the demand for specialty medicines has been increasing at a significant rate, which is further rising the use of bioinformatics and combinatorial chemistry for better drug discovery, further driving the market growth.
An increasing number of clinical trials and the rising prevalence of cancer provide an impetus to the oncology segment. As per the FDA, over 35,000 oncological trials have been performed since 2010. Currently, over USD 38 billion are invested by the healthcare industry in preclinical and clinical development of oncology therapy products. As per the North American Association of Central Cancer Registries (NAACCR) 2019 data, there will be an estimated 17, 50,000 new cancer cases in the U.S.
The infectious disease therapeutic segment is expected to gain traction in the market due to the rising patent expiration of blockbuster drugs. Rising prevalence of infectious diseases and increasing clinical trial activities for the launch of new drugs drive the segment growth. The World Health Organization (WHO) launched the Global Health Sector Strategy that aims to test and treat about 90% and 80% of the people suffering from HBV and HCV by 2030.
Lockdown imposed across the globe has severely impacted the healthcare CRO market due to the cancellation and suspension of new and ongoing research activities. Some of the CROs such as IQVIA and Parexel are operating with elevated financial leverage as they have limited cushion to absorb losses. However, the pharmaceutical giants are actively working to develop a vaccine for the treatment of COVID-19, driving market growth.
North America leads the healthcare contract research organization market and will continue the same during the forecast period. An increasing number of clinical research activities and growing government support to perform R&D activities through grants and funds provide an impetus to the market growth. For instance, in January 2015, the U.S. government invested about USD 215.0 million for precision medicine initiative.
Rising R&D expenditure by the pharmaceutical industry, increasing prevalence of various communicable and non-communicable diseases, and surging demand new drug development drive the market growth. Moreover, the laboratory services segment is anticipated to witness the fastest growth in North America due to an increasing number of clinical trials in the region.
Asia-Pacific’s healthcare contract research organization market is expected to grow at the fastest rate due to rising clinical research activities and favorable government regulations. IQVIA is the largest CRO and holds about 15.6% share in the healthcare CROs market. Other leading global players in Asia-Pacific include PPD (8.4%), PAREXEL (7.6%), Covance (6.5%), and ICON (6.1%). The Charles River Laboratories holds nearly 17% of the market share in preclinical studies in Asia-Pacific.
|Market Size||USD in Billion By 2030|
|Forecast Units||Value (USD Million)|
|Report Coverage||Revenue Forecast, Competitive Landscape, Growth Factors, Environment & Regulatory Landscape and Trends|
|Segments Covered||by Type of Services (Drug Discovery), Therapeutic Areas (Oncology), End-User (Pharmaceutical)|
|Geographies Covered||North America, Europe, Asia-Pacific, LAME and Rest of the World|
|Key Companies Profiled/Vendors||Charles River Laboratories International, Clinipace Ltd, CMIC Holdings, EPS International, ICON Ltd, IQVIA, Medpace, Parexel International, PRA Health Sciences, Synteract ,|
|Key Market Opportunities||Rising Demand For Healthcare Contract Research Organization In Healthcare It Industry|