The global biologics CDMO market (henceforth referred to as the market studied) was valued at USD 11.27 billion in 2021, and it is expected to reach USD 21.90 billion by 2027, registering a CAGR of 11.51% during 2022-2027 (henceforth, referred to as the forecast period).
Key Highlights The global pharmaceutical industry is growing at an exponential rate, which is driven by global economic growth, a growing and aging population, and new product launches. Even though small molecules continue to command the prominent share of the market, large molecules, such as biologics, biosimilars, and cell and gene therapies, are expected to witness the fastest growth over the forecast period.
Even though volumes in large molecules tend to be smaller, the segment is growing at a faster pace. Absolute growth in the large molecules market, including both originator biologics, biosimilars, and cell and gene therapies, is projected at USD 133 billion by 2023. The market size for originator biologics is expected to reach USD 371 billion by 2023, according to Results Healthcare.
Cancer therapies are among the primary drivers for a large proportion of the growth in the biologics market. Even with the faster growth forecast, in terms of drug approvals, small molecules outweigh biologics. For instance, the FDA’s Center for Drug Evaluation and Research (CDER) approved 50 new drugs and biological products in 2021. Of the 50 approved new drugs and biological products, 33 were small molecule drugs, and 17 were monoclonal antibodies and other big molecules drugs. The number of biologic approvals has been increasing steadily over the past few years.
Companies need to invest additional amounts in complying with regulations imposed on the manufacturers. Instead, companies are willing to spend on R&D activities, which benefit the company overall. Hence, the highly regulated manufacturing processes, with complicated technology transfer and IP security concerns, are impeding the anticipated growth and adoption of the market in different regions.
The onset of the COVID-19 pandemic has indicated the potential of vaccine manufacturing and outsourcing as a sustainable revenue stream for the companies operating in the studied market. Followed by the COVID-19 vaccine, the introduction of boosters is expected to create a favorable landscape of growth in the segment for the CDMO vendors. For instance, Catalent has worked on nearly 100 different compounds for investigating their potential to become COVID-19 vaccines and therapies for more than 60 customers.
Key Market Trends
Access To New Technologies And Higher Speed Of Execution Realized By CDMOs
Pressure on reducing the supply chain length and improving lead-time efficiency is forcing companies to take various measures to meet the demand, turning contract manufacturing into a major enabler in the supply chain to reduce the speed of execution.
Often contract manufacturing is followed by contract packaging for some pharmaceutical drugs. As a result, pharmaceutical companies are seeking vendors who provide both contract manufacturing and contract packaging, along with quality testing. In addition, third-party logistic providers, like DHL, are extending their service capability to include contract packaging services.
CDMOs, through advanced technology and specialized expertise, are gaining significant market traction. Keeping up with the latest technology trends is particularly important for niche CDMOs specializing in one compound or dosage form.
In a highly competitive industry, the biopharmaceutical CDMOs that are most likely to succeed are those that are willing to adopt cutting-edge technology and invest the necessary time and capital to build out differentiated capabilities. The best CDMOs will move quickly to increase capacity while remaining flexible and agile.
With the rising prevalence of infectious diseases and increased demand for novel therapies, pharma and biotech companies that require higher capital investments for advanced technologies are forming collaborations with CDMOs, which is further driving the market’s growth.
North America to Hold Maximum Market Share
North America is one of the major markets for the biologics CDMO industry, owing to the presence of two major economies, such as the United States and Canada. The United States is home to one of the major pharmaceutical industries in the world and commands a significant share of the industry revenue.
According to the study by the IQVIA Institute for Human Data Science, global medicine spending will reach USD1.8 trillion in 2026, including spending on COVID-19 vaccines. In addition to this, the region holds a prominent share of the CDMO market as well. According to Results Healthcare, the region holds about 37% of the CDMO market share and is expected to witness growth in mid-single-digit percentage points over the coming years.
The high prevalence of chronic diseases, the aging of the population, and the increased need for evidence?based practice are factors that have bolstered a high demand for clinical trials in the United States. In recent years, a growing number of clinical trials have shifted from academic medical centers to community?based practices to global sites in different countries.
Moreover, the region has a strong foothold on CROs, which contributes to the growth of the market. Some of them include QVIA Holdings Inc., Pharmaceutical Product Development, LLC, PRA Health Sciences Inc., and Laboratory Corporation of America Holdings, among others.? Companies such as Biovectra are also focusing on offering contract development and manufacturing capacity for intermediates and active pharmaceutical ingredients (APIs) at four cGMP facilities in North America. Similarly, the Chinese contract development and manufacturing organization (CDMO) recently signed a 10-year lease deal for a clinical manufacturing facility in the United States, further helping the biologics CDMO market to grow in the country.
Also, Emergent BioSolutions announced various CDMO deals with COVID-19 vaccine developers, including Vaxart, Novavax, J&J, and AstraZeneca. The company’s experience in making anti-infectious disease vaccines for commercial use includes FDA-approved vaccines BioThrax (Anthrax Vaccine Adsorbed) and Vaxchora (Cholera Vaccine, Live, Oral), and its pandemic-ready manufacturing network are major factors in winning these COVID-19 deals. The company’s Bayview drug substance facility in Baltimore, Maryland, was designed and built in partnership with the US government, specifically with the intention to respond to a pandemic. The new Center for Innovation in Advanced Development and Manufacturing (CIADM) is equipped with single-use bioreactor systems of up to 4,000 L.
The Biologics Contract Development and Manufacturing Organization (CDMO) Market is highly concentrated, with close to half of the market being dominated by a few players. In 2021, major players, such as Catalent, Boehringer Ingelheim Group, Lonza Group, and Samsung Biologics, together accounted for more than 30.1% of the market studied.
April 2022 - ChimeronBio announced it signed a manufacturing agreement with FUJIFILM DiosynthBiotechnologies (FDB) to advance the Company’s Oncology portfolio to the clinic. ChimeronBio opted for FUJIFILM DiosynthBiotechnologies as its partner for the transfer and scale-up of their drug substance manufacturing process.
January 2022 - Samsung Biologics signed an agreement with Biogen to acquire Biogen’s 50 percent stake in Samsung Bioepis, a joint venture formed by the two companies, for up to USD 2.3 billion. The complete buyout of Biogen’s stake by Samsung Biologics is anticipated to strengthen Samsung Bioepis’ biosimilar development capabilities and future performance in new drug development.
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