Contract Research Organization Market Size – CRO Industry Overview, Trends Analysis & Growth Forecast (2024 - 2029)

Market Size and Share Analysis:

By service type segment, the clinical research services segment is expected to hold the major CRO market share with USD 47.86 billion in 2024, and it is expected to witness a CAGR of 9.90% during the forecast period. Under clinical research services, Phase III clinical research services are likely to have a major market share with USD 60.29 billion in 2024, and it is expected to witness a CAGR of 9.73% over the forecast period. By therapeutic area segment, the oncology segment is expected to hold the major share in the studied market with an estimated CAGR of 10.17% during the forecast period. By end user, the pharmaceutical and biopharmaceutical companies’ segment is expected to hold the major share in contract research organization market with USD 42.34 billion in 2024, and it is expected to witness a CAGR of 9.87% during the forecast period. The CRO industry overview provides comprehensive research services to pharmaceutical, biotechnology, and medical device companies, facilitating the development and commercialization of new drugs through clinical trials and regulatory support.

The rising number of Phase III clinical trials is set to boost the demand for CRO services. Outsourcing these trials to CROs proves cost-effective, particularly for smaller biopharmaceutical firms and academic institutions with limited budgets. Equipped with advanced infrastructure and technologies, CROs can streamline trial operations, optimize resource use, cut overheads, and enhance overall trial efficiency. As of March 2024, ClinicalTrials.gov reported approximately 44,542 registered clinical studies globally. This substantial figure underscores the anticipated growth of the Phase III segment during the forecast period. CROs specializing in biological and biopharmaceutical trials are strategically positioned to assist sponsors with Phase III studies. For example, in July 2023, Merck (known as MSD outside the U.S. and Canada), Moderna, Inc., and CRO PPD Inc. kicked off the pivotal Phase 3 randomized V940-001 clinical trial. This trial evaluates V940 (mRNA-4157), an investigational individualized neoantigen therapy, in tandem with KEYTRUDA, Merck’s anti-PD-1 therapy, as an adjuvant treatment for patients with resected high-risk (Stage IIB-IV) melanoma.

Overview of Market Segments Covered:

By therapeutic area segment, the oncology segment is anticipated to hold the major contract research organization market share with USD 16.69 billion in 2024, and it is expected to witness a CAGR of 10.17% during the forecast period (2024-2029). As oncology therapies, including targeted therapies and immunotherapies, continue to advance, there's a growing need for specialized manufacturing capabilities. This has led to a heightened demand for contract research organizations (CROs) with oncology expertise to effectively research these intricate drugs. Moreover, oncology-focused CROs, equipped with tailored organization services, are adept at navigating and executing intricate clinical trials. This adaptability positions them favorably for the forecast period.

The increase in the prevalence of cancer is one of the major reasons for the development and research associated with adequate therapy, which positively impacts the demand for CRO services. For instance, according to the report ‘The Figures of the Cancer 2023’ published in January 2023, Spain reported approximately 295,675 new cancer cases in 2023, marking a 1.96% increase from 2022. Consequently, as cancer cases rise, there's an anticipated uptick in the adoption of various therapies, particularly among the elderly. This trend underscores the growing demand for novel drug development, clinical trials, and extensive research, bolstering segment growth throughout the forecast period.

As CROs continue to provide enhanced benefits in the research and development of oncology drugs, the segment is poised for growth in the coming years. For example, in May 2023, Avance Clinical, a CRO operating in both Australia and North America, introduced its ClinicReady and GlobalReady platforms. These services are tailored for early-phase biotech companies, streamlining their journey to regulatory approval. Avance highlighted that early-phase oncology studies are becoming increasingly intricate, necessitating a larger patient pool. Their ClinicReady and GlobalReady platforms play a pivotal role in advancing oncology product development.

The global CRO market is segmented by service type, therapeutic area, and end-user. By service type, the market is segmented into clinical research services, early-phase development services, laboratory services, and consulting services. By therapeutic area, the market is segmented into oncology, infectious diseases, central nervous system (CNS) disorders, immunological disorders, cardiovascular diseases, respiratory disorders, diabetes, and other therapeutic areas. By end-user, the market is segmented into pharmaceutical and biopharmaceutical companies, medical device companies, and academic institutes. The contract research organization (CRO) industry is experiencing significant growth across various segments, including clinical research services, laboratory services, and post-market surveillance.

Regional Market Scope of this Report:

By geography , North America is anticipated to hold the major share in the studied market with USD 28.34 billion in 2024. Revenue forecast indicate that North American CRO market would witness a significant growth rate of 9.60% during the forecast period to 2029. This growth is owing to the presence of key market players and their strategic activities in North America, the rise in several diseases, which created a need for advanced therapeutics, and a surge in research and development activities to develop personalized products.

As chronic diseases such as cardiovascular ailments, diabetes, cancer, and neurological disorders become increasingly prevalent, there's a pressing need for new therapies and treatments. This rising and shifting burden compels pharmaceutical companies to outsource clinical trials, seeking effective candidates for these conditions. Consequently, this trend is anticipated to drive the region’s market growth throughout the study period. For instance, the American Cancer Society's 2024 update projects approximately 2 million new cancer diagnoses in the United States for 2024. This translates to about 5,480 new cases identified daily. Given the pressing need for swift regulatory approvals and clinical trial support in cancer therapies, this significant cancer burden is poised to drive the demand for CRO services, thereby propelling market growth during the forecast period.

Furthermore, as per the November 2023 update from the Canadian Cancer Society, 239,100 Canadians were diagnosed with cancer in 2023. Notably, 2 in 5 Canadians are projected to develop cancer at some point in their lives. This pronounced prevalence underscores the heightened demand for CRO services, further fueling the growth rate in the coming years. Additionally, heightened corporate activities, including new product launches, partnerships, collaborations, and expansions, are anticipated to bolster the country's market growth throughout the study period. For example, in November 2023, Fortrea, a contract research organization (CRO), teamed up with Medidata. They aimed to harness Medidata's AI-driven intelligent trials, enhancing the inclusion of diverse patient demographics in Fortrea's clinical trials. This partnership facilitated the smooth incorporation of varied populations into the clinical trial framework.

By geography, the global contract research organization market is segmented into North America (United States, Canada, Mexico), Europe (Germany, United Kingdom, France, Italy, Spain, Rest of Europe), Asia-Pacific (China, Japan, India, Australia, South Korea, Rest of Asia-Pacific), Middle East and Africa (GCC, South Africa, Rest of Middle East and Africa), and South America (Brazil, Argentina, Rest of South America). In emerging markets, particularly in the Middle East and Africa region, key companies in East Africa utilize local expertise and regulatory insights to optimize the clinical trial process in the region. The geography of the contract research organization (CRO) market has experienced significant growth, driven by increasing demand for outsourced pharmaceutical research and development, including clinical monitoring to ensure compliance and quality throughout clinical trials, particularly in emerging markets like Asia-Pacific and Latin America.

Competitive Landscape and Ecosystem Analysis:

Some of the key players in CRO industry are Charles River Laboratories International, Inc., and ICON PLC. IQVIA Holding, Parexel International Corporation, Inotiv Inc. , Fortrea Holdings Inc., Medpace Holdings Inc. , PSI, Thermo Fisher Scientific Inc. (PPD Inc.), Accell Clinical Research, LLC, SGS SA, SYNEOS Health, Inc., WUXI Apptec, Criterium, Inc., Bioagile and others in the industry. In terms of market share, few of the major players currently dominate the market. Furthermore, few companies are involved in the collaborations for expanding the production capacity which is likely to drive the market growth. For instance, in May 2023, GenScript Biotech Corporation, a CRO, expanded its primary manufacturing facility for oligonucleotide and peptide production in Zhenjiang, Jiangsu, China. With this expansion, four new dynamic axial compression columns have been added to large-scale peptides, achieving an average monthly production capacity of more than 5kg and 32sq.ft. of freeze dryers to support the mass freeze-drying process. Such expansions are expected to increase the adoption of outsourcing services for drug development and clinical trials and further increase the studied market's growth during the forecast period.