Healthcare CDMO Market Size (2024 - 2029)

The healthcare contract development and manufacturing organization market is experiencing growth driven by increased outsourcing activities and rising investment in research and development. The demand for advanced diagnostic and therapeutic products, along with the need for operational efficiencies, is propelling pharmaceutical and medical device companies to outsource more services. The COVID-19 pandemic further accelerated this trend due to the heightened need for vaccine development, leading to more outsourced manufacturing agreements. Market players are also engaging in mergers, acquisitions, and collaborations to enhance their service offerings, contributing to the market's expansion. However, challenges such as compliance issues and regulatory hurdles may pose constraints on the market's growth trajectory.

Market Size of Healthcare CDMO Industry

Healthcare CDMO Market Summary
Study Period 2019 - 2029
Base Year For Estimation 2023
CAGR 8.20 %
Fastest Growing Market North America
Largest Market Asia Pacific
Market Concentration Medium

Major Players

rd-img

*Disclaimer: Major Players sorted in no particular order

Healthcare CDMO Market Analysis

The healthcare contract development and manufacturing organization (CDMO) market was valued at USD 273.21 billion in the current year and is expected to reach USD 432.03 million by the end of the forecast period, registering a CAGR of 8.02%.

COVID-19 has had a significant impact on the healthcare CDMO market owing to the high demand for vaccine development by various pharmaceutical and biotechnology companies in the past three years. For instance, in July 2021, ExeVir and Mithra, a CDMO, collaborated to utilize the fill and finish capabilities for ExeVir's therapies at Mithra's integrated R&D and manufacturing platform to accelerate the development of XVR011 for the potential treatment and prevention of COVID-19. Furthermore, as per a study published in the World Economic Journal in February 2022, companies like Lonza and Catalent played critical roles in manufacturing COVID19 vaccines during the pandemic. Some major pharmaceutical companies like Pfizer and GlaxoSmithKline (GSK) also developed business operations to offer CDMOlike services to other firms to better manage their capacity during the initial phase of the pandemic. Hence, the increased demand for COVID-19 vaccines led to increased outsourced manufacturing agreements for CDMOs, contributing to the market's growth. Therefore, the pandemic positively affected the healthcare contract development and manufacturing organization market.

The significant factors that drive the market's growth include the increasing research and development (R&D) activities by the pharmaceutical and medical devices company, as well as increasing demand for advanced diagnostic and therapeutic products.

Outsourcing activities benefit many healthcare companies by improving operational efficiencies, expanding geographical presence, decreasing resource costs, gaining therapeutic expertise, and enhancing on-demand services. For instance, in May 2023, an article published in Akums Pharmaceutical stated that outsourcing API expertise in drug development offers numerous benefits for pharmaceutical companies. It includes various services such as technical expertise, regulatory compliance, and efficient manufacturing processes, enabling pharmaceutical companies to focus on their core competencies, such as R&D. Additionally, by outsourcing API manufacturing, pharmaceutical companies can accelerate their drug development timelines, access new technologies, and ensure consistent quality control. Outsourcing API expertise provides pharmaceutical companies with strategic advantages, allowing them to optimize resources, enhance efficiency, and bring high-quality drugs to market. Thus, owing to the benefits offered by the CDMO, the adoption of outsourcing is increasing by pharmaceutical companies, thereby contributing to market growth.

Moreover, increasing investment in R&D also propels the growth of the market. For instance, in January 2023, GenScript's Biologics subsidiary ProBio notched its fundraising round and raised about USD 224 million. The investment will help ProBio with further research and development, expanding its manufacturing capacity and developing its CDMO business. Similarly, in June 2022, Jubilant Pharma Limited announced that the Government of Quebec had granted them a loan of USD 18 million to fund the capacity expansion of the contract manufacturing facility in Montreal.

Market players are also adopting several strategies, such as mergers, acquisitions, and collaboration, which are expected to boost the healthcare CDMO market growth over the forecast period. For instance, in July 2023, Societal CDMO Inc. announced the expansion of its broad suite of CDMO services to address the biopharmaceutical industry's expanding activity in psychedelic drug development. Similarly, in October 2022, Terumo Pharmaceutical Solutions (TPS), a division of Terumo Corporation, announced that it would expand its contract development and manufacturing services for parenteral drugs to global customers.

Hence, growing investment in research and development, increasing outsourcing by pharmaceutical, biopharmaceutical, and medical devices companies, and strategic activities undertaken by market players are expected to boost the market growth over the forecast period. However, compliance issues while outsourcing, the changing scenario of outsourcing in developing countries, and regulatory and legal compliance are expected to restrain the market over the forecast period.

Healthcare CDMO Industry Segmentation

Healthcare contract development and manufacturing organization (CDMO) provides services to pharmaceutical, biotechnology, and medical device companies. These services often include developing, manufacturing, and testing medical products. CDMOs play a crucial role in the healthcare industry by offering specialized expertise and infrastructure to help bring new drugs and medical devices to market efficiently and safely. 

The Healthcare Contract Development and Manufacturing Organization Market is Segmented By Services (Contract Development (Small Molecule (Preclinical (Bioanalysis and DMPK Studies, Toxicology Testing, and Other Preclinical Services) Clinical (Phase I, Phase II, Phase III, and Phase IV), Large Molecule (Cell Line development, Process Development (Upstream (Microbial, Mammalian, and Others), and Downstream (MABs, Recombinant Proteins, and Others) and Others) and (Contract Manufacturing (Small Molecule, Large Molecule (MABs, Recombinant Protein, and Others), High Potency API, Finished Dose Formulations (Solid Dose Formulation, Liquid Dose Formulation, and Injectable Dose Formulation), and Medical Devices (Class I, Class II, and Class III)), and Geography (North America, Europe, Asia-Pacific, Middle East and Africa, and South America). The report offers the value (in USD) for the above segments. The report also covers the estimated market sizes and trends for 17 countries across major regions globally.

By Services
Contract Development
Small Molecule
Preclinical
Bioanalysis and DMPK Studies
Toxicology Testing
Other Preclinical Services
Clinical
Phase I
Phase II
Phase III
Phase IV
Large Molecule
Cell Line development
Process Development
Upstream
Microbial
Mammalian
Others
Downstream
MABs
Recombinant Proteins
Others
Contract Manufacturing
Small Molecule
Large Molecule
MABs
Recombinant Proteins
Others
High Potency API
Finished Dose Formulations
Solid Dose Formulation
Liquid Dose Formulation
Injectable Dose Formulation
Medical Devices
Class I
Class II
Class III
By Geography
North America
United States
Canada
Mexico
Europe
United Kingdom
Germany
France
Spain
Italy
Rest of Europe
Asia-Pacific
India
Japan
China
Australia
South Korea
Rest of Asia-Pacific
Middle East & Africa
GCC
South Africa
Rest of the Middle East & Africa
South America
Brazil
Argentina
Rest of South America
Need A Different Region Or Segment?
Customize Now

Healthcare CDMO Market Size Summary

The healthcare contract development and manufacturing organization (CDMO) market is experiencing significant growth, driven by increased demand for vaccine development and advanced therapeutic products. The COVID-19 pandemic has notably accelerated this growth, as pharmaceutical and biotechnology companies sought to rapidly develop and manufacture vaccines, leading to a surge in outsourced manufacturing agreements with CDMOs. This trend has been further supported by the rising research and development activities within the pharmaceutical and medical devices sectors, which are increasingly outsourcing to improve operational efficiencies, expand their geographical presence, and enhance their service offerings. The strategic advantages of outsourcing, such as accessing new technologies and ensuring consistent quality control, are encouraging more companies to engage CDMOs, thereby fueling market expansion.

Investment in research and development is a key driver of the healthcare CDMO market, with significant funding directed towards expanding manufacturing capacities and developing CDMO businesses. Market players are actively pursuing mergers, acquisitions, and collaborations to enhance their service offerings and address the growing demand in the biopharmaceutical industry. The North American region, in particular, is witnessing robust growth due to established research facilities, high R&D investments, and a strong presence of key market players. The increasing incidence of chronic diseases, such as cancer, is further propelling the demand for novel therapies and, consequently, CDMO services. As the market continues to evolve, the focus on providing comprehensive, one-stop-shop services is expected to intensify, with major players like Catalent Inc., Lonza, and Thermo Fisher Scientific leading the charge.

Explore More

Healthcare CDMO Market Size - Table of Contents

  1. 1. MARKET DYNAMICS

    1. 1.1 Market Overview

    2. 1.2 Market Drivers

      1. 1.2.1 Increasing Outsourcing Services by Pharmaceutical, Biotechnology, and Medical Devices Companies

      2. 1.2.2 Rising Investment in Research and Development

      3. 1.2.3 Growing Demand for Advanced Diagnostic and Therapeutic Products

    3. 1.3 Market Restraints

      1. 1.3.1 Compliance Issues While Outsourcing

      2. 1.3.2 Regulatory and Legal Compliance

    4. 1.4 Industry Attractiveness - Porter's Five Forces Analysis

      1. 1.4.1 Bargaining Power of Suppliers

      2. 1.4.2 Bargaining Power of Buyers

      3. 1.4.3 Threat of New Entrants

      4. 1.4.4 Threat of Substitute Products

      5. 1.4.5 Intensity of Competitive Rivalry

  2. 2. MARKET SEGMENTATION (Market Size by Value - USD)

    1. 2.1 By Services

      1. 2.1.1 Contract Development

        1. 2.1.1.1 Small Molecule

          1. 2.1.1.1.1 Preclinical

            1. 2.1.1.1.1.1 Bioanalysis and DMPK Studies

            2. 2.1.1.1.1.2 Toxicology Testing

            3. 2.1.1.1.1.3 Other Preclinical Services

          2. 2.1.1.1.2 Clinical

            1. 2.1.1.1.2.1 Phase I

            2. 2.1.1.1.2.2 Phase II

            3. 2.1.1.1.2.3 Phase III

            4. 2.1.1.1.2.4 Phase IV

        2. 2.1.1.2 Large Molecule

          1. 2.1.1.2.1 Cell Line development

          2. 2.1.1.2.2 Process Development

            1. 2.1.1.2.2.1 Upstream

              1. 2.1.1.2.2.1.1 Microbial

              2. 2.1.1.2.2.1.2 Mammalian

              3. 2.1.1.2.2.1.3 Others

            2. 2.1.1.2.2.2 Downstream

              1. 2.1.1.2.2.2.1 MABs

              2. 2.1.1.2.2.2.2 Recombinant Proteins

              3. 2.1.1.2.2.2.3 Others

      2. 2.1.2 Contract Manufacturing

        1. 2.1.2.1 Small Molecule

        2. 2.1.2.2 Large Molecule

          1. 2.1.2.2.1 MABs

          2. 2.1.2.2.2 Recombinant Proteins

          3. 2.1.2.2.3 Others

        3. 2.1.2.3 High Potency API

        4. 2.1.2.4 Finished Dose Formulations

          1. 2.1.2.4.1 Solid Dose Formulation

          2. 2.1.2.4.2 Liquid Dose Formulation

          3. 2.1.2.4.3 Injectable Dose Formulation

        5. 2.1.2.5 Medical Devices

          1. 2.1.2.5.1 Class I

          2. 2.1.2.5.2 Class II

          3. 2.1.2.5.3 Class III

    2. 2.2 By Geography

      1. 2.2.1 North America

        1. 2.2.1.1 United States

        2. 2.2.1.2 Canada

        3. 2.2.1.3 Mexico

      2. 2.2.2 Europe

        1. 2.2.2.1 United Kingdom

        2. 2.2.2.2 Germany

        3. 2.2.2.3 France

        4. 2.2.2.4 Spain

        5. 2.2.2.5 Italy

        6. 2.2.2.6 Rest of Europe

      3. 2.2.3 Asia-Pacific

        1. 2.2.3.1 India

        2. 2.2.3.2 Japan

        3. 2.2.3.3 China

        4. 2.2.3.4 Australia

        5. 2.2.3.5 South Korea

        6. 2.2.3.6 Rest of Asia-Pacific

      4. 2.2.4 Middle East & Africa

        1. 2.2.4.1 GCC

        2. 2.2.4.2 South Africa

        3. 2.2.4.3 Rest of the Middle East & Africa

      5. 2.2.5 South America

        1. 2.2.5.1 Brazil

        2. 2.2.5.2 Argentina

        3. 2.2.5.3 Rest of South America

Healthcare CDMO Market Size FAQs

The Healthcare CDMO Market is projected to register a CAGR of 8.20% during the forecast period (2024-2029)

Catalent Inc., Lonza, Recipharm AB, Thermo Fisher Scientific, Inc and Labcorp Drug Development are the major companies operating in the Healthcare CDMO Market.

Healthcare Contract Development and Manufacturing Organization Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)