India CDMO Market, By Service Type (API (Active Pharmaceutical Ingredients) Manufacturing, Finished Product Manufacturing, Packaging Services, Clinical Research Services (CRO), Laboratory Services), By Application (Generic Drugs, Branded Drugs, Biologics Drugs, Vaccines), By End User (Pharmaceutical Companies, Biotechnology Companies, Research Institutions), By Region, Competition, Forecast & Opportunities, 2020-2030F

Market Overview

India CDMO Market was valued at USD 17.51 Billion in 2024 and is anticipated to project robust growth in the forecast period with a CAGR of 13.60% through 2030. India's Contract Development and Manufacturing Organization (CDMO) sector has emerged as a cornerstone of the global pharmaceutical industry, driven by robust growth and strategic advantages. The country offers a highly competitive manufacturing environment, characterized by cost efficiency, a deep reservoir of skilled scientific talent, and adherence to stringent international regulatory standards. These attributes position India as an indispensable outsourcing hub for leading global pharmaceutical firms.

The sector's trajectory is strongly supported by India's growing expertise in biologics, including vaccines and advanced therapies, as well as government policies that actively foster innovation and infrastructure development. These dynamics solidify India’s standing as a premier destination for pharmaceutical outsourcing, making it a critical partner in the global drug supply chain.

Key Market Drivers

Skilled Workforce and Scientific Expertise

The skilled workforce and scientific expertise in India play a pivotal role in driving the growth of the Contract Development and Manufacturing Organization (CDMO) market. These elements provide a strong competitive advantage, enabling Indian CDMOs to cater to complex global pharmaceutical demands effectively. India produces a large number of graduates and postgraduates annually in the fields of pharmacy, biotechnology, chemistry, and chemical engineering. This ensures a steady supply of highly skilled professionals adept in pharmaceutical research, development, and manufacturing processes. The availability of this talent pool at competitive costs allows CDMOs to maintain high-quality output while optimizing operational expenses. In the academic year 2022, engineering and technology led Ph.D. enrollments in India, with over 52,000 students pursuing doctoral studies in these fields. This was followed by science disciplines with more than 45,000 enrollments and social sciences with over 26,000 enrollments, highlighting the country's academic focus on technology, scientific research, and social studies.

Indian scientists and researchers have developed a reputation for excellence in the discovery and development of small molecules, biologics, biosimilars, and specialty drugs. Their expertise extends across the entire pharmaceutical value chain, including process optimization, formulation development, analytical testing, and scale-up for commercial manufacturing. This capability helps Indian CDMOs meet the growing demand for innovative and complex therapeutics. A skilled workforce well-versed in international regulatory standards is critical for success in the CDMO industry. Indian professionals have significant expertise in ensuring compliance with stringent regulatory requirements, including those set by the U.S. FDA, European Medicines Agency (EMA), and other global regulatory bodies. This compliance capability boosts the confidence of international clients in outsourcing high-stakes projects to Indian CDMOs. India's scientific community is increasingly embracing advanced technologies such as artificial intelligence (AI), machine learning (ML), and continuous manufacturing to optimize drug development and production processes. This focus on innovation enhances efficiency, reduces time-to-market, and ensures cost-effectiveness, making Indian CDMOs preferred partners for global pharmaceutical companies.

Indian CDMOs are adept at scaling operations from small-batch R&D to large-scale commercial manufacturing. The workforce's technical expertise ensures seamless transitions between these stages while maintaining quality and consistency. This scalability is particularly valuable for clients seeking to expedite product launches in competitive markets. The CDMO industry in India places significant emphasis on knowledge sharing and workforce upskilling. Regular training programs, collaboration with global pharmaceutical firms, and exposure to cutting-edge projects ensure that the workforce remains updated with the latest industry trends and technologies. This continuous learning culture strengthens the sector’s ability to address complex client needs. The shift towards biologics and specialty drugs has created demand for specialized skills in cell culture, protein expression, purification, and analytical techniques. Indian CDMOs have rapidly built expertise in these areas, supported by a scientifically skilled workforce capable of handling the intricate processes involved in biologics manufacturing.

Increasing Demand for Biologics and Specialty Drugs

The increasing demand for biologics and specialty drugs is a significant growth driver for the Contract Development and Manufacturing Organization (CDMO) market in India. As global healthcare needs evolve, the pharmaceutical industry is shifting focus from traditional small molecules to complex biologics and high-value specialty drugs. This trend aligns with the capabilities of Indian CDMOs, positioning them as key contributors to the global supply chain. The global burden of chronic illnesses, such as cancer, diabetes, and autoimmune disorders, is increasing, alongside the identification of rare diseases. Biologics and specialty drugs, known for their precision and efficacy, are pivotal in treating these conditions. Indian CDMOs are expanding their capabilities to meet this rising demand by investing in infrastructure and technology to manufacture these advanced therapies. The increasing prevalence of chronic disease also increase the demand of biologics and specialty drugs, for instance The overall prevalence of chronic conditions in India is as follows: diabetes at 62.47 cases per 1,000 population, hypertension at 159.46 cases per 1,000 population, ischemic heart disease (IHD) at 37.00 cases per 1,000 population, and stroke at 1.54 cases per 1,000 population. Additionally, India reports an estimated 2.5 million cancer cases.

The global pharmaceutical industry is increasingly prioritizing the development of biologics, biosimilars, and specialty drugs due to their higher margins and therapeutic value. Indian CDMOs have responded by building expertise in producing monoclonal antibodies, gene therapies, vaccines, and other biologics, allowing them to align with this strategic focus and capture a larger share of outsourcing projects. Biologics production is inherently more complex and expensive than traditional drug manufacturing. Indian CDMOs offer a cost-efficient alternative to companies in developed markets, leveraging their advanced facilities and skilled workforce to provide high-quality biologics manufacturing at competitive prices. This cost advantage makes India an attractive destination for outsourcing biologics production. To cater to the biologics market, Indian CDMOs are investing heavily in state-of-the-art manufacturing facilities equipped with single-use bioreactors, downstream processing systems, and advanced analytical tools. These investments enable them to handle the intricate processes required for biologics and specialty drugs, including cell line development, protein expression, and purification.

With patents for many blockbuster biologics expiring, the demand for biosimilars (generic versions of biologics) is surging. Indian CDMOs are well-positioned to capitalize on this opportunity due to their expertise in cost-efficient manufacturing and regulatory compliance. Biosimilars represent a lucrative segment that is driving significant growth in the Indian CDMO sector. India has long been a global leader in vaccine production, and this strength has translated into its biologics capabilities. The COVID-19 pandemic highlighted India's potential in developing and manufacturing vaccines at scale. This expertise is now being leveraged to produce other biologics, such as oncology drugs and immunotherapies, further accelerating market growth. Global pharmaceutical companies are increasingly partnering with Indian CDMOs to develop and manufacture biologics and specialty drugs. These collaborations provide access to advanced technologies, global markets, and expertise in regulatory pathways, strengthening India’s position in this high-growth segment.

Rising Global Healthcare Expenditure

Rising global healthcare expenditure is a significant catalyst for the growth of the Contract Development and Manufacturing Organization (CDMO) market in India. As healthcare systems worldwide prioritize increased spending to address evolving medical needs, Indian CDMOs are strategically positioned to capitalize on this trend. Governments and private sectors in emerging economies are increasing healthcare spending to improve access to medical treatments. This surge in investment creates a higher demand for cost-effective pharmaceuticals, which Indian CDMOs are well-equipped to provide. Their ability to manufacture high-quality drugs at competitive prices aligns with the needs of these markets, enabling them to capture a growing share of global pharmaceutical outsourcing. Government investment in healthcare has grown significantly in recent years. The share of Government Health Expenditure (GHE) in GDP increased from 1.13% in 2014-15 to 1.84% in 2021-22. Similarly, its proportion of General Government Expenditure (GGE) rose from 3.94% to 6.12% over the same period. This growth underscores the government’s commitment to enhancing public healthcare services, particularly in addressing challenges amplified by the COVID-19 pandemic.

Global healthcare expenditure is heavily influenced by the aging population and the increasing prevalence of chronic diseases such as diabetes, cardiovascular conditions, and cancer. These factors drive demand for innovative drugs, biologics, and specialty therapies. Indian CDMOs are meeting this demand by offering end-to-end solutions, including drug development, manufacturing, and supply chain management, tailored to the production of these complex treatments. Rising healthcare costs in developed markets have led governments and healthcare providers to seek cost-saving measures, including outsourcing drug manufacturing to low-cost regions like India. Indian CDMOs leverage their cost-efficiency and expertise to produce pharmaceuticals that help reduce overall healthcare expenditure without compromising quality. As global healthcare systems face budget constraints, there is an increasing reliance on generic drugs to reduce medication costs. Indian CDMOs, with their established expertise in producing generics, are playing a critical role in supplying affordable alternatives to branded medications. This demand has positioned India as a global hub for cost-effective pharmaceutical production.

The rising expenditure on healthcare includes significant investments in biopharmaceuticals, a high-growth segment driven by the need for advanced therapies. Indian CDMOs are capitalizing on this trend by expanding their capabilities in biologics, biosimilars, and specialty drugs, aligning with the strategic priorities of global healthcare stakeholders. Global healthcare expenditure has surged in the area of preventive care, particularly in vaccine development and distribution. The COVID-19 pandemic further emphasized the need for scalable and cost-efficient vaccine production. Indian CDMOs, with their proven track record in vaccine manufacturing, have become preferred partners for international organizations and pharmaceutical companies, contributing to the sector's growth. Many countries are increasing healthcare spending to achieve universal health coverage (UHC), which emphasizes affordable access to essential medicines and treatments. Indian CDMOs, known for their cost-effective production processes, are key players in supporting these initiatives by supplying affordable drugs at scale to global markets.

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Key Market Challenges

Limited Infrastructure for Advanced Therapies

While Indian CDMOs excel in small-molecule production and generics manufacturing, infrastructure for advanced therapies such as biologics, cell and gene therapies, and specialty drugs remains underdeveloped in many facilities. This limitation restricts their ability to compete in high-growth, high-margin segments of the global pharmaceutical market.

Developing capabilities for biologics and advanced therapies requires substantial capital investment in specialized equipment, cleanroom facilities, and talent acquisition. Although the Indian workforce is skilled, advanced therapy production requires niche expertise, which is still in the early stages of development. Many CDMOs remain focused on traditional manufacturing segments due to lower risk and immediate revenue potential, limiting diversification into future-oriented technologies.

Without significant investment in infrastructure and expertise, Indian CDMOs risk being excluded from lucrative opportunities in the biologics and specialty drug markets, which are projected to dominate the future of global pharmaceuticals.

Intense Global Competition and Price Pressure

Indian CDMOs face stiff competition from other low-cost manufacturing hubs such as China, Southeast Asia, and Eastern Europe. Additionally, the global outsourcing landscape is becoming increasingly competitive, with clients demanding lower costs while expecting superior quality and faster turnaround times.

China’s aggressive investment in pharmaceutical infrastructure, biologics capabilities, and regulatory reforms has made it a formidable competitor in the CDMO market. Over-reliance on cost advantages as a competitive strategy leads to price wars, which reduce profit margins and hinder the ability to invest in R&D and innovation. Many Indian CDMOs depend heavily on a limited number of large clients, making them vulnerable to shifts in outsourcing strategies or price renegotiations.

Price pressures and intense competition can erode profitability and stifle long-term growth. Without differentiation through innovation, advanced offerings, or strategic partnerships, Indian CDMOs risk losing market share to more agile competitors.

Key Market Trends

Integration of Digital and Smart Manufacturing Technologies

The adoption of advanced digital technologies is transforming the pharmaceutical manufacturing landscape, with Indian CDMOs increasingly investing in smart manufacturing to enhance efficiency, scalability, and quality.

The integration of IoT (Internet of Things), AI (Artificial Intelligence), and ML (Machine Learning) enables predictive analytics, real-time monitoring, and automated decision-making in manufacturing processes. Advanced analytics and machine learning algorithms improve process optimization, ensuring consistent quality while minimizing errors and waste. Transitioning from traditional batch processing to continuous manufacturing allows Indian CDMOs to produce drugs more efficiently and meet the demands for faster time-to-market.

By embracing smart manufacturing, Indian CDMOs can position themselves as innovation leaders, attract clients seeking technologically advanced partners, and improve operational efficiency, giving them a competitive edge in the global market.

Rise of Customization and Personalized Medicine

The global pharmaceutical market is shifting towards personalized medicine, focusing on tailored treatments based on individual genetic, molecular, or clinical profiles. This trend is creating new opportunities for Indian CDMOs to offer customized solutions.

Personalized medicine requires the production of small, customized batches of drugs, a departure from traditional large-scale manufacturing. Indian CDMOs are increasingly developing capabilities to manufacture cell therapies, gene therapies, and precision oncology drugs. The rise of treatments for rare diseases aligns with this trend, with Indian CDMOs expanding their expertise in this high-value, specialized market.

By building capabilities in personalized medicine, Indian CDMOs can access higher-margin segments and differentiate themselves from competitors reliant on traditional manufacturing.

Segmental Insights

Service Type Insights

Based on the category of Service Type, the Active Pharmaceutical Ingredient (API) Manufacturing segment emerged as the dominant in the India CDMO Market in 2024. India has long been recognized as the "Pharmacy of the World," with a robust infrastructure for manufacturing APIs. The country accounts for a significant share of the global API supply, catering to markets in the U.S., Europe, and emerging economies. Indian CDMOs leverage economies of scale and low production costs to offer competitively priced APIs, making them preferred outsourcing partners for global pharmaceutical companies. The presence of state-of-the-art API manufacturing facilities, many of which are certified by international regulatory bodies such as the U.S. FDA and EMA, enhances India’s credibility as a reliable API supplier.

The increasing global demand for generic drugs fuels the need for APIs, a segment in which Indian CDMOs excel. The expiration of patents for blockbuster drugs has further boosted opportunities for API manufacturing in India. Indian CDMOs have a proven track record in producing high-quality generic APIs at scale, making them key players in the global generic drug market. Pharmaceutical companies in developed markets face cost pressures, driving them to outsource API production to cost-efficient locations like India. Indian CDMOs are increasingly adopting vertical integration strategies, encompassing API production, formulation, and finished product manufacturing. This reduces dependency on external suppliers, particularly for key starting materials (KSMs) and intermediates. With a focus on backward integration, Indian CDMOs have mitigated risks related to supply chain disruptions, especially in light of global challenges like the COVID-19 pandemic. Vertical integration enables end-to-end control over the pharmaceutical production process, increasing efficiency and reducing time-to-market for new drugs. These factors are expected to drive the growth of this segment.

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Regional Insights

South India emerged as the dominant in the India CDMO Market in 2024, holding the largest market share in terms of value. South India is home to key pharmaceutical clusters, particularly in cities like Hyderabad, Bangalore, and Chennai, which are renowned for their advanced infrastructure and global connectivity. These hubs have positioned the region as a focal point for pharmaceutical research, manufacturing, and export.

Known as the bulk drug capital of India, Hyderabad houses numerous API manufacturing units and CDMOs, contributing significantly to the global API supply.  With its strong focus on biotechnology and innovation, Bangalore supports CDMOs specializing in biologics and advanced therapies. Chennai’s proximity to ports and well-developed logistics infrastructure facilitates smooth export operations for pharmaceutical products. The region benefits from a large pool of skilled professionals, particularly in pharmaceutical sciences, biotechnology, and chemical engineering, supported by prominent educational institutions. Institutions such as the Indian Institute of Technology (IIT) Madras and the National Institute of Pharmaceutical Education and Research (NIPER) in Hyderabad contribute to a highly skilled talent pipeline. Partnerships between academic institutions and CDMOs foster innovation, particularly in drug discovery and formulation development.

Regional Insights

• In July 2024, Akums, India’s leading pharmaceutical contract development and manufacturing organization (CDMO), is preparing to raise INR 680 crore in fresh capital as part of an initial public offering (IPO) valued at approximately INR 1,750 crore, including an offer for sale, according to market sources cited by ET Pharma.
• In August 2024, Akums Drugs and Pharmaceuticals, India’s largest Contract Development and Manufacturing Organization (CDMO), has submitted two dossiers in the European Union (EU) as part of its strategic efforts to expand its portfolio, with a third dossier currently in development. This move to penetrate the European market comes amid significant shifts in the global pharmaceutical landscape. With the U.S. market facing volatility and margin pressures, Europe presents an appealing alternative due to its market stability, substantial size, and harmonized regulatory framework.

Key Market Players

• Cipla Limited
• Divi's Laboratories Limited
• Dr. Reddy’s Laboratories Ltd
• Piramal Pharma Limited
• Akums Drugs and Pharmaceuticals Ltd.
• Sunwin Healthcare Private Limited.
• Prakruti Life Science Pvt. Ltd

Report Scope:

In this report, the India CDMO Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• India CDMO Market, By Service Type:

o   API (Active Pharmaceutical Ingredients) Manufacturing

o   Finished Product Manufacturing

o   Packaging Services

o   Clinical Research Services (CRO)

o   Laboratory Services

• India CDMO Market, By Application:

o   Generic Drugs

o   Branded Drugs

o   Biologics Drugs

o   Vaccines

• India CDMO Market, By End User:

o   Pharmaceutical Companies

o   Biotechnology Companies

o   Research Institutions

• India CDMO Market, By Region:

o   North India

o   South India

o   East India

o   West India

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the India CDMO Market.

Available Customizations:

 India CDMO market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

• Detailed analysis and profiling of additional market players (up to five).