Pharmaceutical Contract Development and Manufacturing Organization (CMO) Market Report 2025

The pharmaceutical contract development and manufacturing organization (CMO) market size has grown strongly in recent years. It will grow from $174.33 billion in 2024 to $186.62 billion in 2025 at a compound annual growth rate (CAGR) of 7.1%. The growth in the historic period can be attributed to strong economic growth in emerging markets, rising healthcare expenditure, increase in pharmaceutical research and development (R&D) expenditure and increasing preference for outsourcing.

The pharmaceutical contract development and manufacturing organization (CMO) market size is expected to see strong growth in the next few years. It will grow to $260.83 billion in 2029 at a compound annual growth rate (CAGR) of 8.7%. The growth in the forecast period can be attributed to increasing government support, increase in healthcare access, increase in investments and increase in biopharmaceutical development will drive the market. Major trends in the forecast period include increased focus on sustainability, focus on integration of artificial intelligence and digitalization, innovative products with focus on resilience, increasing investments and strategic partnerships and collaborations among market players.

The expansion of the pharmaceutical contract development and manufacturing market is fueled by the global increase in demand for medicines. The heightened prevalence of diseases, coupled with the desire for longer lifespans, has led to a surge in the demand for medications. This, in turn, has prompted pharmaceutical companies to intensify the production of existing drugs and augment their research and development (R&D) investments to facilitate the creation of new drugs. In response to these demands, pharmaceutical companies are engaging in collaborations with contract manufacturing organizations (CMOs) as a strategic approach to reducing operational costs, thereby fostering an elevated demand for the pharmaceutical contract development and manufacturing market. According to Alkermes PLC, a biopharmaceutical company, pharmaceutical contract manufacturing is becoming a strategic choice for companies of varying sizes, from large enterprises to smaller specialty pharma entities, driven by the imperative to cut costs.

The anticipated growth in the pharmaceutical contract development and manufacturing market is further propelled by the escalating phenomenon of patent expiration. Patent expiration signifies the conclusion of the legally protected exclusive rights granted to an inventor or patent holder for a specified duration, allowing them to make, sell, or use the invention. Pharmaceutical contract development and manufacturing play a crucial role in facilitating the rapid development and production of generic drugs, enabling their entry into the market upon the expiration of patents. For example, in 2023, DrugPatentWatch, a US-based web service platform, reports that a total of 37 drugs are set to face patent expirations, paving the way for generic market entry. Consequently, the increasing patent expiration is a significant driver for the pharmaceutical contract development and manufacturing market.

Pharmaceutical contract development and manufacturing companies are actively engaging in acquisitions and forming strategic alliances to strengthen their market presence. This trend reflects a strategic focus on expanding global market reach, meeting client requirements, enhancing production capabilities, and gaining access to cutting-edge technology and new services. The heightened frequency of merger and acquisition activities has led to the consolidation of contract service providers within the industry. For example, in July 2022, Pharma Nobis, a US-based provider of contract manufacturing and private label services, acquired Fagron’s U.S. contract manufacturing business. This strategic move allows Pharma Nobis to extend contract manufacturing and private label services to American retailers and consumer healthcare corporations, with Fagron retaining a 20% ownership stake in the company.

Leading companies in the pharmaceutical contract development and manufacturing market are innovating their service portfolios to cater to evolving industry needs. One such offering is the DevPack, a service designed to optimize processes across multiple partners and create a standardized dataset for development process steps. ASM Research Chemicals, a Germany-based company providing contract research and manufacturing services, launched the DevPack service in May 2023. Tailored for active pharmaceutical ingredients (APIs) manufacturing, DevPack streamlines API research, development, and scale-up. It is particularly beneficial for Contract Manufacturing Organizations (CMOs) and pharmaceutical firms aiming for rapid early-stage manufacturing route development, along with supporting analytical development and regulatory submissions.

In August 2022, Catalent, Inc., a US-based provider of delivery technologies, development, and drug manufacturing, completed the acquisition of Metrics Contract Services for $475 million. This strategic move enhances Catalent's capabilities in working with highly potent chemicals and strengthens its expertise in integrated oral solid formulation research, production, and packaging. The acquisition is aimed at assisting clients in streamlining and expediting their processes. Metrics Contract Services is a US-based pharmaceutical contract development and manufacturing organization.

Major companies operating in the pharmaceutical contract development and manufacturing organization (CMO) market include Lonza Group, Catalent Inc, WuXi AppTec Inc., Pfizer Inc, Recipharm AB, Almac Group, Aenova Group, Baxter International Inc, SGS Life Science Services SA, Jubilant Pharmova Ltd, Dishman Pharmaceuticals, Kemwell Pvt. Ltd., Nipro Corp., CMIC Group, Sawai Pharmaceutical Co., Ltd, IDT Australia Limited, Aurigene Pharmaceutical Services Limited, Vetter Pharma International GMBH, Consort Medical PLC, Siegfried Holding AG, Evonik Industries, NextPharma, Royal DSM N.V, HAUPT Pharma AG, Boehringer Ingelheim International GmbH, Famar, OTC-PharmNEUCA, Farmacol, Polska Grupa Farmaceutyczna, Polpharma, TZMO, AbbVie Inc, Merck & Co Inc, Amgen Inc, Gilead Sciences Inc, Regeneron Pharmaceuticals Inc, Vertex Pharmaceuticals Inc, Johnson & Johnson, Eurofarma Laboratórios S.A., Ache Laboratórios Farmacêuticos S.A., Blanver Farmoquímica e Farmacêutica S.A., Prati-Donaduzzi, União Química Farmacêutica Nacional S.A, Laboratorios Richmond S.A.C.I.F., Bago S.A., Elea Laboratories S.A.C.I. y F., Gador S.A., LIFEPharma, Neopharm, Gulf Pharmaceutical Industries JULPHA, NewBridge Pharmaceuticals Limited, Aspen Pharmacare Holdings Limited, Adcock Ingram Holdings Limited, Pharma-Q (Pty) Ltd, Vital Health Foods, EIPICO (Egyptian International Pharmaceutical Industries Company), Pharco Pharmaceuticals.

North America was the largest region in the global pharmaceutical contract development and manufacturing market in 2024. The Middle East is expected to be the fastest-growing region in the global pharmaceutical contract development and manufacturing market during the forecast period. The regions covered in the pharmaceutical contract development and manufacturing organization (cmo) market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the pharmaceutical contract development and manufacturing organization (CMO) market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Italy, Canada, Spain.

Pharmaceutical Contract Development and Manufacturing (CDMO) involves businesses that provide services for drug research and manufacturing in the pharmaceutical sector. Pharmaceutical companies can choose to outsource drug development and production by partnering with CDMOs. Full-service CDMOs are capable of managing every stage of the process, accommodating clients who wish to outsource specific steps in their workflow. The services provided are tailored to the specific requirements of each client.

Pharmaceutical Contract Development and Manufacturing Organizations (CMO) primarily offer contract manufacturing services and contract research services. Contract manufacturing services involve outsourcing manufacturing processes or goods production to a third-party company, commonly known as a contract manufacturer. The research phases encompass preclinical, phase I, phase II, phase III, and phase IV. End-use sectors for CDMOs include large pharmaceutical companies, generic pharmaceutical companies, and small to medium-sized pharmaceutical companies.

The pharmaceutical contract development and manufacturing market research report is one of a series of new reports that provides pharmaceutical contract development and manufacturing market statistics, including pharmaceutical contract development and manufacturing industry global market size, regional shares, competitors' pharmaceutical contract development and manufacturing market share, detailed pharmaceutical contract development and manufacturing market segments, market trends and opportunities, and any further data you may need to thrive in the pharmaceutical contract development and manufacturing industry. This pharmaceutical contract development and manufacturing market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenarios of the industry.

The pharmaceutical contract development and manufacturing market includes revenues earned by entities by providing drug development and manufacturing services. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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