The Total Addressable Market (TAM) for Medical Affairs Outsourcing was valued at USD 1.53 billion in 2022. It is projected to reach USD 4.21 billion by 2031, growing at a CAGR of 11.9% during the forecast period (2023-2031). In today's pharmaceutical, biotechnology, medical device, and diagnostic industries, the medical affairs function is becoming increasingly important. Additionally, the importance of medical affairs activities is growing earlier and later in a product's lifecycle. This growing involvement is primarily a result of the desire of practicing physicians to be and remain more clinically informed and educated about new therapeutic concepts and advancements—on the leading edge. These areas are outside the capabilities and responsibilities of the commercial teams and sales representatives, driving a significant increase in the company's field medical affairs organizations, such as medical science liaisons, nurse educators, and drug information contact centers.
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High Quality and Cost-Effective Services Offered by CROs
Profit margins in the pharmaceutical and medical device industries have declined due to increased pricing pressure, stricter regulatory requirements, and increased patent expirations. Pharmaceutical and biopharmaceutical companies use contract medical affairs services as a "strategic competitive weapon" because they can reduce costs. The need for medical affairs services has increased dramatically due to rising R&D costs and pharmaceutical companies' increased emphasis on cost containment.
In order to improve quality and cut costs, biopharmaceutical companies are now prepared to outsource their medical affairs operations. Due to CROs' growing capacity to manage each medical affairs function, which would lessen the need for additional work from biopharmaceutical companies, this trend is anticipated to continue. The global market for medical affairs outsourcing is expected to benefit from partnerships between biopharmaceutical firms and CROs.
Lack of Experienced Technical Staff
Expanding the capabilities will help medical affairs service providers forge alliances with major pharmaceutical and medical device firms. The sector must develop strong problem-solving skills and a broad range of knowledge. Medical affairs service providers need staff with various skills, including leaders in digital design, data scientists, and social media listening and engagement specialists. To fulfill the rising demand for talented medical affairs professionals, they also need to develop fundamental skill sets like the focus on quality, strategic thinking, leadership and communications abilities, and emotional intelligence. Such skill is currently in short supply in the sector. This resource shortage is anticipated to be a significant barrier to expanding the medical affairs outsourcing market.
Rising Number of Clinical Trials
More clinical trials and research studies are being conducted globally as a result of pharmaceutical and biopharmaceutical companies increasing their R&D spending. Over 35,000 oncological clinical studies, or 18% of all trials, have been started since 2007, according to Mint Medical. In addition, from 2,500 in 2007 to 4,000 in 2017, more than 600% more oncological trials were launched annually. Due to the rise in clinical trials and the introduction of new medicines, there has been a steady rise in the need for medical affairs service providers among pharmaceutical and medical device businesses.
The global medical affairs outsourcing market is segmented into services and industry
Based on services, the global market is bifurcated into medical writing and publishing, medical monitoring, Medical Science Liaisons (MSLs), and others.
The medical writing and publishing segment is the highest contributor to the market and is expected to grow at a CAGR of 12.60% during the forecast period. Medical writing entails the creation of various scientific documents, such as regulatory and research-related documents, drug or disease-related promotional and educational literature, health-related magazines, news articles, content for healthcare websites, and publication articles like journal manuscripts & abstracts. As a result, the content must be precise and of the highest caliber, which only qualified medical writers can accomplish with in-depth subject knowledge and expertise. One of the main factors driving industry expansion is the rising need for regulatory paperwork caused by the biotechnology and pharmaceutical industries. Most pharmaceutical corporations hire medical writing and publication experts to manage their clinical data.
A critical step in the clinical research process is medical monitoring. It provides direction and medical know-how for the entire clinical trial procedure. Additionally, it provides safety and accountability throughout the study and upholds the clinical integrity of the subjects. There are many advantages to outsourcing medical monitoring services, including reviewing all research team deliverables, examining efficacy and safety trends, and offering therapeutic and project-specific training. Companies in the pharmaceutical and biotechnology industries outsource these functions to cut operational expenses and lower the risk of non-compliance with regulations.
MSLs are consultants with doctorates in the life sciences, sophisticated scientific training, and academic qualifications. They are pros at communicating detailed medical information to various stakeholders. Additionally, although MSLs are typically needed after a product launch, it is not cost-effective for pharmaceutical and medical device companies to keep them on staff. Further, for pharmaceutical and medical device businesses, finding and training MSLs to establish a team is expensive and time-consuming. MSLs should be knowledgeable and able to communicate effectively to represent the product better in the marketplace, which drives most businesses to hire MSLs from outside service providers.
Based on industry, the global market is bifurcated into pharmaceuticals, biopharmaceuticals, and medical devices.
The pharmaceutical segment owns the highest market share and is expected to grow at a CAGR of 11.90% during the forecast period. Pharmaceutical businesses use medical affairs services they outsource to control R&D value, save training costs for a medical affairs team, and obtain high-quality documentation. Pharmaceutical companies are outsourcing these services to optimize the management of product lifecycles and various commercial activities. In addition, it is anticipated that cost-effective service offerings and strict regulatory requirements will boost market expansion over the forecast period. The demand for pharmaceutical corporations to outsource medical affairs functions is also projected to be driven by fierce competitive rivalry.
Due to resource limitations, rigorous evaluation of the R&D process, and a surge in requests for biopharmaceutical products from emerging economies, biopharmaceutical companies are increasingly outsourcing medical affairs responsibilities. In addition, as opposed to non-core activities like medical affairs, biopharmaceutical firms are focusing more on core activities connected to clinical trials. Companies are also outsourcing these functions to cut costs and access expert medical affairs services from outside providers.
The market for medical devices is constantly under pressure to decrease costs without sacrificing the R&D process, time to market, or the accompanying safety and quality. New technologies, process developments, and a rising aging population drive this market segment's growth. Medical affairs and Regulations thus get more complex and strict as market competition rises. By outsourcing portions of their operations, Original Equipment Manufacturers (OEMs) of medical devices can gain more agility, lower operational costs, a shorter time to market, and a higher return on investment. OEMs can also convert their organizations from cost centers into strategic investments.
Technology improvements have reduced the size and efficiency of medical equipment, such as medication delivery systems, life-assist devices, and therapeutic devices. In contrast to complex and massive instruments that require professional technicians or physicians, wearable or implantable medical devices (IMDs) that monitor, administer, treat, and track patient problems are becoming increasingly common. IMDs have an easy-to-use user interface, updated designs, rechargeable batteries, and inexpensive and low-power components.
The global medical affairs outsourcing market is divided into four regions, namely North America, Europe, Asia-Pacific, and LAMEA.
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North America Dominates the Global Market
North America is the most significant global medical affairs outsourcing market shareholder and is expected to grow at a CAGR of 11.80% during the forecast period. One of the strictest regulatory frameworks in the entire globe is recognized to exist in North America. Biologic drug approvals in North America have significantly increased and now makeup 39.0% of all new drug approvals, which is a sign of the expanding biotechnology product pipeline. The need for medical affairs services to be outsourced by large biopharmaceuticals is predicted to rise due to strict regulatory procedures and rising R&D spending in North America. Numerous biopharmaceutical and medical device businesses are based in North America, and many outsource some of their regulatory duties to regulatory service providers. The high cost of R&D is a significant issue, which has prompted North American-based biopharmaceutical and medical device businesses to outsource some tasks to people with high domain expertise.
Asia-Pacific is expected to grow at a CAGR of 13.90% during the forecast period. The region is expected to increase at the fastest rate due to the region's improving regulatory environment, cost reductions, the number of clinical trials undertaken there, and the expansion of biopharmaceutical businesses. Another factor anticipated to spur growth is the region's access to skilled labor at a lower cost than in the United States. Similarly, the expansion of established biopharmaceutical companies in the region could increase the demand for various medical affair service providers due to the region's heterogeneous and complex regulatory environment.
Europe is expected to grow significantly over the forecast period. The pharmaceutical industry is decentralized throughout Europe. Players must have in-depth knowledge of the various regulatory processes in the various European Union member states to enter the European market. Without a regulatory affairs division, small- and mid-sized biopharmaceutical businesses frequently employ a regulatory consultant or a legal counsel to help them navigate the regulatory approval stages necessary for marketing their product in Europe. The European Medicine Agency (EMA), Europe's regulatory body, accounts for 25.0% of global pharmaceutical sales. This is one of the leading forces behind the trend toward outsourcing medical affairs in the life sciences industry. More drugs awaiting regulatory approval would result in a higher demand for services from local life sciences firms.
Latin America, after the Asia-Pacific, is one of the regions with the fastest-growing medical affairs outsourcing markets due to its more favorable cost structures, a higher number of clinical trials, and more new players entering the pharmaceutical industry. The Middle East and Africa is one of the rising regions in the pharmaceutical and medical device sector. Brazil, Mexico, Venezuela, and Argentina are driving the expansion of the Latin American life sciences market. In addition, global biopharmaceutical and medical firms are anticipated to be drawn to this market due to the rising population and increased government attempts to expand access to healthcare, enhancing the demand for medical affairs services in the area. Due to technological advancements, cost-effectiveness, and the simplicity of the patient recruitment process, the Middle East and Africa region currently accounts for 6.0% of all clinical trial applications.
The global medical affairs outsourcing market's major key players are ICON plc, IQVIA Holdings, Inc., The Medical Affairs Company, Syneos Health, Inc., Pharmaceutical Product Development, LLC, Ashfield Healthcare Communications, Zeincro Group, Wuxi Clinical Development, Inc., SGS S.A., and Indegene, Inc.