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The Biologics CDMO industry is growing at an exponential rate all over the world.
In this article we deep dive into the specifics around where and why there has been a significant rise in the biologics CDMO market. We also discuss where we can expect the market to be in the very near future.
According to current and recent market research, the biologics CDMO space, which was valued at $9.93 billion in 2020, is now expected to reach new heights of $18 billion by 2026, registering an annual growth rate of around 11% between 2021 and 2026.
As we can see from the news the pharmaceutical and life science industry is growing at an incredible rate and is expected to hit over $1.5 trillion in yearly sales by 2023. This increase is being spearheaded by economic growth, a growing and aging population and new product launches. Large molecules, such as biologics, biosimilars and cell and gene therapies, are expected to see the fastest growth over the forecasted period, and according to news reports, this is projected at $133 billion by 2023.
By region, reports suggest North America will dominate the global biologics CDMO market. This is due to the presence of two major economies, the US and Canada. The US is without a doubt one of the world’s largest pharmaceutical industries and commands a hefty share of the industry revenue. According to IQVIA, in 2019, the US accounted for nearly 50% of the global pharmaceutical and life science market sales and has recorded a steady growth in the last couple of years.
In addition to this, the US also accounts for almost 50% of the R&D spending in pharmaceutical and biotechnology markets. Back in 2018, PhRMA reported that the total R&D spend in the US market was nearly $80 billion. This is because biologic CDMOs play a crucial role in this market and therefore have invested in new facilities, technologies, acquisitions and staff to cater to a wider range of outsourcers.
Some examples of biologics CDMOs expanding their presence and capabilities in North America include AGC Biologics. AGC Biologics recently acquired a Cell and Gene Therapy commercial manufacturing facility from Novartis. The 622,000-ft2 site is only 16 miles away from their large-scale stainless-steel mammalian facility in Boulder which also had investments of around $100 million.
Reports also state that COVID-19 has and will continue to influence the biologics CDMO industry as time goes on. This is due to the demand for vaccines and therapeutic antibodies which is expected to continue for several years. Additionally, the pandemic has highlighted supply chain inefficiencies, such as the global reliance on China and India for production of active pharmaceutical ingredients (APIs) and generics. This is another reason we can expect to see a drive supply chain diversification and encourage countries to adopt domestic manufacturing and supply, which CDMOs can capitalise on.