CMO/CDMO Biotechnology Market

CMO/CDMO Biotechnology Market Outlook (2024 to 2034)

The global CMO/CDMO biotechnology market is estimated at US$ 67.21 billion in 2024 and is projected to reach a size of US$ 199.09 billion by 2034-end, expanding at a high-value CAGR of 11.5% between 2024 and 2034.

Companies in the biotechnology and biopharmaceutical industries hire CDMO for development and production services. Pharma/biopharma and biotechnology firms collaborate with CDMOs to delegate the development and manufacturing of pharmaceuticals. Biotechnology instruments offer a variety of services, including development, biomanufacturing, analytical testing, fill finishing, packaging, and clinical supply.

Leading CDMOs are focusing on growing their integrated capabilities from the molecule to the final product due to advancements in contract solutions. This is a noteworthy trend since it reflects the growing importance of the CMO/CDMO biotechnology market trends and faster development for biopharmaceutical and biologics developers.

To treat severe, life-threatening illnesses, leading industry participants are focusing on the creation and introduction of next-generation biotherapeutics. The pipeline for developing biologics at this time is supportive of prospects for steady growth.

Key Factors Driving Market Expansion

• Standalone services occupy a leading market share because pharmaceutical and biotechnology companies are expanding their cell-line development services.
• Prominent international CDMOs are directing their efforts toward growing their capacity for quick and flexible manufacturing.
• Asia Pacific accounts for a leading CMO/CDMO biotechnology market share and is expected to maintain its position throughout the forecast period.

Report Attributes	Details
CMO/CDMO Biotechnology Market Size (2024E)	US$ 67.21 Billion
Forecasted Market Value (2034F)	US$ 199.09 Billion
Global Market Growth Rate (2024 to 2034)	11.5% CAGR
North America Market Share (2034F)	32.61%
East Asia Market Growth Rate (2024 to 2034)	11.2% CAGR
Standalone Services Segment Market Share (2024E)	59%
Small Molecules Segment Market Share (2024E)	56.1%
Key Companies Profiled	Laboratory Corporation of America Holdings Boehringer Ingelheim GmbH Toyobo Co., Ltd. Samsung Biologics Thermo Fisher Scientific Inc. ICON Plc.

What’s Augmenting Demand for CMO/CDMO Biotechnology Services?

“Reduction of In-House R&D Department for Companies and CRO Service Cost-effectiveness”

One of the main areas of investment in the biotech and pharmaceutical sectors is research and development. To make better pharmaceuticals at lower costs, companies invest a large portion of their capital and revenues in research and development. With price and function being the primary competitive factors in the pharmaceutical and biotechnology sectors, pharmaceutical corporations gain a notable competitive edge.

Following the rise of CRO players, many pharmaceutical companies, particularly those with modest operations, saw a reduction in their research and development departments. As more CROs entered the market and began to provide research services at competitive prices, they overcame inside pharmaceutical R&D departments. CROs employ multiple tactics to maintain a competitive edge over leading pharmaceutical companies.

“Evolving Business Models in Biopharmaceutical CDMOs Adapting to Industry Consolidations”

The biopharmaceutical sector has seen a large number of consolidations in recent years. The primary goals of these consolidations were corporate growth and maintaining competitiveness for biopharmaceutical contract manufacturing and services. Despite the relatively recent development of the biopharmaceutical CMO and CRO space, there has been a notable increase in demand for contract bio manufacturers. This is due to the introduction of novel therapies, new bioprocess technology, and changes in product priorities within the pharmaceutical sector. To effectively serve the demands of their stakeholders and clients, CDMOs are implementing improved business models.

How Can Market Expansion be Hindered to Some Extent?

“Stringent Legal Environment and Complexity of Contract Discussions”

Incorporation of single-use systems in manufacturing facilities facilitates the cost-effective expansion of manufacturing capacity for the CMOs. The single-use products minimize related tasks like cleaning and changeover validation while providing quick turnaround times. However, because of the legal environment and complexity of services, it is found that contract discussions between CMOs and clients are challenging.

The complexity of negotiations increases since clients and CMOs have to deal with concerns related to intellectual property rights, warranties and obligations, prices, and timetables.

“Intricacy of Biopharma Supply Chain and Operations”

The CMO and CDMO operations within the biotechnology sector are characterized by high levels of complexity in the biopharmaceutical supply chain. This complexity stems from the sensitivity of biopharmaceutical products, which require controlled temperature environments for storage and shipping. Flexibility in the supply chain is especially crucial for life-saving medications to accommodate changes in demand.

Country-wise Insights

China's CMO/CDMO biotechnology market size is influenced by backing from the government, changing regulatory environment, and growing integration with the world's biopharmaceutical supply chain.

Continuous merger and acquisition activities among American businesses are driving strong growth of the United States market. There is a growing preference for single-use bioreactors, which is helping the business expand.

Why is Demand for CMO/CDMO Biotechnology Solutions High in China?

“Government Support and Initiatives Expediting Regulatory Clearances”

Attribute	China
Market Value (2024E)	US$ 23.93 Billion
Growth Rate (2024 to 2034)	11.5% CAGR
Projected Value (2034F)	US$ 71.3 Billion

The market in China has been expanding rapidly due to a combination of local and international causes. As part of a larger effort to progress in high-tech industries, the Chinese government has been actively assisting the biotech sector. Initiatives like "Made in China 2025" have given the market a boost with policies that support innovation and biotech investments, and accelerate regulatory clearances.

China's expanding aging population, rising incidence of chronic diseases, and expanding middle class, which has higher healthcare expectations, are all contributing to the country's growing need for biologic products.

Why is the United States a Profitable Market for CMO/CDMO Biotechnology Service Providers?

“Increasing Interdependency Between CMOs and SMEs”

Attribute	United States
Market Value (2024E)	US$ 21.4 Billion
Growth Rate (2024 to 2034)	10.3% CAGR
Projected Value (2034F)	US$ 56.88 Billion

Responding to market and outsourcing demands, CMOs in the United States have expanded beyond basic manufacturing services to offer a variety of services. This expansion is propelled by steady sector growth and a rising trend of outsourcing biotechnology and pharmaceutical services by companies focusing on core competencies to enhance profit margins.

Significant portion of products authorized in the United States are manufactured by CMOs. Many small- and medium-sized enterprises (SMEs) lack the funding or capacity to establish facilities with sufficient equipment. The dominance of the United States market results from the increasing interdependency between CMOs and SMEs in the country.

Category-wise Insights

CMOs and CDMOs provide a range of standalone services to support different phases of drug development and manufacture in the biotechnology sector. The market for small-molecule drugs is sizable and is still expanding due to continuous research and development across a range of therapeutic areas.

Which Type of Service are Companies Widely Adopting?

“High Adoption of Standalone Services Enabling Companies to Focus on Core Expertise”

Attribute	Standalone Services
Segment Value (2024E)	US$ 39.67 Billion
Growth Rate (2024 to 2034)	12.2% CAGR
Projected Value (2034F)	US$ 125.19 Billion

Biotechnology and biopharmaceutical firms rely on CDMOs for vital services such as biomanufacturing, analytical testing, development, clinical supply, fill-finishing, packaging, and more. Due to the growing demand for cell-line development services in the biopharmaceutical and biotechnology industries, standalone services occupy a leading market share. For biotech and pharmaceutical businesses, particularly those without the internal resources or knowledge to handle these tasks independently, these services are essential.

Biopharmaceutical firms, especially SMEs, can outsource various aspects of their manufacturing and drug development processes with the help of these standalone services. This enables businesses to take advantage of the specific skills of CMOs and CDMOs while focusing on their main expertise, such as medication discovery and marketing.

Which Product is Projected to Occupy a Leading Market Share?

“Growing COVID-19 Vaccine Pipeline and Biologics Production Driving Need for Small Molecules”

Attribute	Small Molecules
Segment Value (2024E)	US$ 37.71 Billion
Growth Rate (2024 to 2034)	7.1% CAGR
Projected Value (2034F)	US$ 74.85 Billion

The CMO/CDMO biotechnology market growth is fueled by several factors. These include the expansion of the generic drug market, the widespread adoption of small molecule drugs across various diseases, the expiration of drug patents, the demand for more advanced techniques in manufacturing active pharmaceutical ingredients (APIs) and finished dosage formulations (FDFs), increased activities such as mergers, acquisitions, and investments, the rising pipeline of COVID-19 vaccines and biologics production, and the aging population.

Small molecules play a crucial role alongside biologics. "Small molecules," which are low molecular weight substances, are significant components in medications due to their ease of cell entry and interaction with biological macromolecules like DNA and proteins. Typically, chemical synthesis is employed for their creation.

Competitive Landscape

Due to the multiple vendors that contribute to market share, the pharmaceutical CDMO industry is fragmented. A direct cause of competition, especially for small-scale providers, is the presence of multiple competitors in the market, which affects service pricing. To obtain a competitive advantage, market vendors are expected to focus on providing one-stop shopping services.

• In June 2023, Catalent expanded the scope of its One Bio Suite solution to encompass various biotechnological modalities, including cellular and gene therapy, mRNA, antibody, and recombinant protein research and manufacturing.

Segmentation of CMO/CDMO Biotechnology Market Research

• By Service:

  • Standalone Services
  • Integrated Developments

• By Product:

  • Large Molecules
  • Small Molecules

• By Organization:

  • Small
  • Mid-sized
  • Large

• By Scale of Operation:

  • Preclinical
  • Clinical
  • Commercial

• By Expression System:

  • Mammalian
  • Microbial

• By Region:

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia & Oceania
  • Middle East & Africa