The healthcare industry has witnessed tremendous growth over the past few decades and continues expanding rapidly to cater to the increasing healthcare needs globally. Contract manufacturing organizations (CMOs) provide drug development and manufacturing services to pharmaceutical and biotechnology companies which help reduce development costs and improve efficiencies. CMOs also eliminate the need for companies to maintain large in-house manufacturing capabilities which allows them to focus on their core competencies of drug discovery and clinical research. There has been a significant increase in pharmaceutical companies outsourcing their manufacturing activities to CMOs such as tablet and capsule production, lyophilization, sterile filling, packaging etc.
The global Healthcare CMO Market is estimated to be valued at US$ 507.46 Mn in 2023 and is expected to exhibit a CAGR of 5.4% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
One of the key trends driving growth of the healthcare CMO market is the increasing demand for biosimilars and biologics. Biologic drugs have revolutionized treatment for various critical diseases however they are also expensive to develop and manufacture. To make these drugs more affordable, biosimilar development has increased significantly in past years through outsourcing to CMOs which provide expertise and infrastructure for biologics manufacturing. Many big pharmaceutical companies are partnering with CMOs for biosimilar development to commercialize cost-effective biologics and expand patient access. This is expected to boost the healthcare CMO market substantially over the forecast period.
Threat of new entrants: The healthcare CMO market requires high initial capital investment which makes the threat of new entrants moderate.
Bargaining power of buyers: The bargaining power of buyers is moderate as there are many established players in the market.
Bargaining power of suppliers: Suppliers have low bargaining power due to availability of substitutable raw materials.
Threat of new substitutes: Threat of new substitutes is low as the market offers specialized services with high customer switching costs.
Competitive rivalry: The competitive rivalry is high among the key players to gain higher market share.
The Global Healthcare CMO Market Demand is expected to witness high growth over the forecast period. The global Healthcare CMO Market is estimated to be valued at US$ 507.46 Mn in 2023 and is expected to exhibit a CAGR of 5.4% over the forecast period 2023 to 2030.
North America dominates the healthcare CMO market currently due to presence of major players and high adoption of advanced technologies. Asia Pacific is expected to grow at the fastest rate owing to rising healthcare expenditure and growth of pharma industry in the region.
Key players operating in the healthcare CMO market are FMC Corporation, BASF SE, Bayer AG, Sumitomo Chemical Co., Ltd., Syngenta AG, Adama Agricultural Solutions Ltd., UPL Limited (previously United Phosphorus Limited), Nufarm Limited, Tagros Chemicals India Ltd., Heranba Industries Limited.
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it