Contract Development and Manufacturing Organization Market to Grow at CAGR of 6.48% through 2029F

Technological advancements in manufacturing and rising regulatory complexity is expected to drive the Global Contract Development and Manufacturing Organization Market growth in the forecast period, 2025-2029.

According to TechSci Research report, “Contract Development and Manufacturing Organization Market – Global Industry Size, Share, Trends, Competition Forecast & Opportunities, 2019-2029F”, the Global Contract Development and Manufacturing Organization Market stood at USD 240.19 Billion in 2023 and is expected to reach USD 346.69 Billion by 2029 with a CAGR of 6.48% during the forecast period.

The growing demand for generic drugs is a significant driver of the Global Contract Development and Manufacturing Organization (CDMO) market. Generic drugs, which are cost-effective alternatives to branded medications, offer substantial savings opportunities for healthcare systems, governments, and patients alike. As patents for major blockbuster drugs expire, the global market for generics has expanded rapidly, creating a strong need for efficient and cost-effective manufacturing solutions. This shift toward generics is particularly important as healthcare systems around the world are under increasing pressure to control costs while ensuring that patients have access to affordable treatment options.

CDMOs play a critical role in this burgeoning market by providing manufacturing services for generic drugs. These organizations help pharmaceutical companies reduce production costs by leveraging their specialized facilities, expertise, and economies of scale. This enables the production of generics at competitive prices, ensuring that they can be made available to a wider population. CDMOs often have the necessary experience and infrastructure to navigate complex regulatory pathways, facilitating the approval and market entry of generic drugs.

The production of complex generics, such as biosimilars and high-potency drugs, has become increasingly important. These types of generics require specialized manufacturing processes that involve advanced technologies and a high level of expertise. CDMOs are essential in supporting the development and production of these complex generics, as they possess the technical capabilities required to produce them safely and effectively. As governments worldwide continue to prioritize access to affordable medicines, the demand for generic drugs is expected to rise steadily. This, in turn, will lead to an increased need for outsourced manufacturing services provided by CDMOs. With the growing importance of generics in global healthcare, this trend is likely to remain a key driver of growth for the CDMO market in the coming years, further solidifying their role in the pharmaceutical supply chain.

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The Global Contract Development and Manufacturing Organization Market is segmented into service type CMO, research phase CRO, regional distribution, and company

Based on Research Phase CRO, in the Global Contract Development and Manufacturing Organization (CDMO) Market, the Phase III research phase is currently the dominating segment. Phase III trials are critical in the drug development process as they involve large-scale testing to evaluate the effectiveness, safety, and side effects of a new drug or treatment. As a result, there is an increased demand for CDMOs to support pharmaceutical and biotechnology companies during this phase, which often requires scaling up manufacturing processes to meet the volume needs of large, multicenter clinical trials. The demand for Phase III services is particularly high due to the growing number of clinical trials focused on complex biologics, gene therapies, and specialty drugs. These products require highly specialized manufacturing capabilities and are subject to stringent regulatory standards. CDMOs involved in Phase III trials play a key role in ensuring that the drug is produced consistently at a commercial scale, while also meeting the regulatory requirements for clinical trial material production, packaging, and logistics.

The increasing trend of pharmaceutical companies outsourcing large-scale manufacturing and clinical trial support to CDMOs is driving the growth of the Phase III segment. By outsourcing these critical functions, companies can focus on their core competencies such as drug discovery and development, while ensuring that their clinical trial material is produced with high quality and efficiency. As drug development timelines shorten and competition intensifies, CDMOs that specialize in Phase III manufacturing are well-positioned to capture market share and provide essential services to clients during this critical stage.

Europe is the second-largest market for the Global Contract Development and Manufacturing Organization (CDMO) Market, following North America. Europe’s position is driven by a well-established pharmaceutical and biotechnology industry, combined with strong regulatory frameworks, making it an attractive location for pharmaceutical outsourcing. Europe is home to some of the largest pharmaceutical companies, such as Novartis, Roche, and AstraZeneca, which fuel the demand for high-quality, compliant manufacturing services. The region also has a robust network of biotechnology firms, many of which rely on CDMOs for the development and production of novel biologics, cell and gene therapies, and personalized medicines. As the drug development process becomes more complex, European companies are increasingly outsourcing manufacturing functions to CDMOs with specialized expertise in these areas. In addition to the large pharmaceutical sector, Europe benefits from strong regulatory authorities, including the European Medicines Agency (EMA), which ensures that pharmaceutical products adhere to rigorous quality and safety standards. This regulatory expertise enhances the attractiveness of European CDMOs to global clients seeking compliance with European Union (EU) regulations and market access within the region.

Major companies operating in Global Contract Development and Manufacturing Organization Market are:

• Catalent Inc.
• Recipharm AB
• Jubilant Pharmova Limited
• Thermo Fisher Scientific Inc.
• Boehringer Ingelheim International GmbH
• Pfizer Inc (Pfizer CentreOne)
• Baxter International Inc.
• Aenova Holding GmbH
• Lonza Group
• tesa Labtec GmbH

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“Cost-efficiency and scalability are among the most significant factors driving the growth of the Global Contract Development and Manufacturing Organization (CDMO) Market. Pharmaceutical companies are under increasing pressure to reduce the overall cost of drug production while simultaneously improving operational efficiency. Building and maintaining in-house manufacturing facilities is an expensive and resource-intensive endeavor, requiring substantial capital investment, ongoing operational costs, and stringent adherence to regulatory compliance. These investments can be particularly burdensome for smaller or mid-sized companies that may lack the financial capacity to develop and sustain state-of-the-art facilities. Outsourcing manufacturing processes to CDMOs offers pharmaceutical companies a cost-effective alternative. By partnering with a CDMO, companies can avoid the substantial upfront costs associated with facility construction, equipment procurement, and regulatory certifications. Instead, they can leverage the CDMO’s established infrastructure and specialized expertise to manufacture drugs efficiently and at scale, significantly reducing financial risks and operational complexities. Another key benefit of outsourcing to CDMOs is their ability to offer scalable production capabilities. This scalability allows pharmaceutical companies to adjust production volumes quickly and cost-effectively in response to fluctuating market demands.,” said Mr. Karan Chechi, Research Director of TechSci Research, a research-based management consulting firm.

“Contract Development and Manufacturing Organization Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Service Type CMO (Active Pharmaceutical Ingredient (API) Manufacturing, Finished Dosage Formulation (FDF) Development and Manufacturing, Secondary Packaging), By Research Phase CRO (Pre-clinical, Phase I, Phase II, Phase III, Phase IV), By Region and Competition, 2019-2029F”, has evaluated the future growth potential of Global Contract Development and Manufacturing Organization Market and provides statistics & information on market size, structure and future market growth. The report intends to provide cutting-edge market intelligence and help decision makers take sound investment decisions. Besides, the report also identifies and analyzes the emerging trends along with essential drivers, challenges, and opportunities in Global Contract Development and Manufacturing Organization Market.

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