The growth of Contract Development Manufacturing Organizations and the manufacturing of APIs has been credited to a rise in the demand for generic drugs, patent expirations, and biological innovations. However, the COVID-19 pandemic has drastically increased the demand for innovations and generic drugs, recently. Although there has been an increased demand for APIs catering to these fields, the supply of API has proved challenging.

The pandemic has resulted in business lockdowns in several parts of the world. China is the first country to face the devastations of the pandemic and as such has extended periods of lockdown. This resulted in over 44 Chinese API manufacturers closing their operations temporarily due to the government-imposed lockdown restrictions. Since China is a leading API manufacturing hub and also the major region, where the raw materials for API manufacturing are found, these non-operational Chinese CDMOs severely affected the supply of API at a global scale.

Various countries and governments worldwide have opted to boycott APIs made in China. However, this also means that they need to either manufacture or source API from other regions. This dichotomy in the decision versus the supply scenario has resulted in two major changes. First, other regions like Singapore, Belgium, and India are focusing more on API manufacturing, thereby aiming to become the API hubs of the future. Also, corporates are focusing on CDMO from multiple regions to serve locally, thereby omitting the chances of supply chain disruptions like the ones caused by the COVID-19 pandemic. They are also looking to operate from countries where CDMO can import from Chinese players.

CDMO API Manufacturing Category Intelligence Highlights:

• The CDMO API manufacturing market features a fragmented competitive landscape and several small players are entering the market. However, several mergers and acquisitions are happening recently. The market is expected to consolidate in future
  
  
• Suppliers widely prefer approved provider operating models to reduce risks and improve the potential for value creation
  
  
• Value-based pricing models have become one of the most commonly used pricing strategies recently

Read report summary or request a free sample copy of the report “Contract Development Manufacturing Organization Market Procurement Intelligence, Supplier Intelligence & Ranking, Pricing & Cost Structure Intelligence, Best Practices, Engagement Model, Low & Best Cost Country, Day One Analysis Report, 2020 – 2025”

CDMO Cost Intelligence Highlights:

Grand View Research has identified the following key cost components for availing CDMO API manufacturing:

• Project Planning and Management Costs
  
  
• Drug Product Analytical Development
  
  
• Batch Manufacturing CostsSupplier Management

•       Filter Validation
•       Creation of Batch Records
•       Raw Material Costs
•       Machinery and Accessory Cost
•       Vile Production Costs
•       Other GMP Batch Production Costs
•       Stability Studies

• Operational Costs

• Insurance
• Freight
• Service Fee
• Storage
• Admin

Batch manufacturing cost is the major cost component of a CDMO API manufacturer, accounting for 65% of the total cost of manufacturing.

Operational Capabilities - Weightage

• Years in Service15%
• Geographical Service Presence30%
• Employee Strength5%
• Revenue Generated10%
• Key Clients10%
• Certifications30%

Functional Capabilities - Weightage

Use molecule 35%

• Cyclosporine
• Tetracycline
• Daptomycin
• Vancomycin
• Steroids
• Others

Type 30%

• Innovative
• Generic

Sysnthesis 20%

• Biotech type
• Synthetic type

Other functionalities offered by CMOs 15%

List of Key Suppliers in the CDMO API manufacturing market

• Pantheon
• Evonik
• Lonza
• AMRI
• Siegfried
• Fabbrica Italinana Sintetici
• Hovione
• Esteve

Global Pharmaceutical Contract Manufacturing & Contract Research Market is anticipated to reach USD 238.3 billion by 2025. Contract manufacturing offers supports to the complete outsourcing market, due to its widespread adoption and popularity by pharmaceutical establishments. The factors that propel the growth of the Pharmaceutical Contract Manufacturing & Contract Research industry include decrease in the cost of production of APIs, increasing focus on cost reduction, the rising price pressure.

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On the other hand, there are factors that may hamper the growth of the market including stringent rules and regulations, and steady improvement. Pharmaceutical Contract Manufacturing & Contract Research Market is anticipated to grow at a significant CAGR in the upcoming period as the scope, product types, and its applications are increasing across the globe.

Pharmaceutical Contract Manufacturing & Contract Research industry may be explored by type, application, and geography. The market may be explored by product type as Finished Dosage Formulations (FDF); which may further include (Parenteral/Injectables, Tablet, Oral Liquids, Capsule, Others), Active Pharmaceutical Ingredients (API), OTC Medicines and Nutritional Products, Advanced Drug Delivery Products, and Others. The “Active Pharmaceutical Ingredients (API)” segment led the Pharmaceutical Contract Manufacturing & Contract Research Market in 2016 and is anticipated to maintain its dominance by 2025 due to increasing demand for High Potency Active Pharmaceutical Ingredients (HPAPI).

The key applications that could be explored in the Pharmaceutical Contract Manufacturing & Contract Research industry include Biopharmaceutical, and Pharmaceutical. The market by end users could span Non-sterile, and Sterile. North America accounted for the major share of the Pharmaceutical Contract Manufacturing & Contract Research Market Size in 2016 and will continue to lead in the forecast period. However, Asia Pacific is anticipated to raise at a surplus rate. The factors that could be attributed to the growth include increase in number of corporations outsourcing the schemes in the emerging economies.

Some of the key players that fuel the growth of the Pharmaceutical Contract Manufacturing & Contract Research industry comprise Pharmaceutical Product Development LLC, Catalent, AbbVie, Patheon, Baxter Biopharma Solutions, Dalton Pharma Services, Grifols International, S.A., and Lonza AG., and Boehringer Ingelheim Biopharmaceuticals GmBh. The leading companies are taking up partnerships, mergers and acquisitions, and joint ventures in order to boost the inorganic growth of the industry.

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Market Segment:

Pharmaceutical Contract Manufacturing/Contract Research Market, Service Types Outlook (Revenue, USD Billion, 2014 - 2025)
    • Manufacturing Services (CMO)
        • API/Bulk Drugs
        • Advanced Drug Delivery Formulations Packaging
        • Packaging
        • Finished Dose Formulations
            • Solid Formulations
            • Liquid Formulations
            • Semi-solid Formulations
    • Research Services (CRO)
        • Oncology
        • Vaccines
        • Inflammation & Immunology
        • Cardiology
        • Neuroscience
        • Others

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