Formulation development outsourcing market to be worth over $60bn by 2030
Market research suggests the global formulation development outsourcing market will significantly expand in coming years, owing to disease burden and R&D expenditure.
According to a recent report, the global formulation development outsourcing market size should grow to $61.4 billion by 2030, expanding at a compound annual growth rate (CAGR) of 7.2 percent from its 2022 value of $35.1 billion.
The investigators found that the high burden of chronic and infectious diseases, growing focus on bioavailability enhancement for poorly soluble drugs, and the challenges associated with drug development were the major contributors to the demand for formulation development services globally.
COVID-19 is also driving demand, as the need to find effective treatment against the contagious virus resulted in significant investments in R&D to develop therapeutics.
According to Informa’s Pharma R&D Annual Review 2022, biopharmaceutical and anti-cancer drugs are the major classes of drugs in the development stage in 2022, which is expected to improve the demand for formulation development of these drugs post pandemic.
Pharmaceutical companies globally are significantly investing in R&D. For instance, in 2020, Merck’s R&D cost was approximately $2.5 billion and Biogen’s approximately $4 billion. For Biogen, this was a 75 percent increase in R&D expenditure from 2019.
A significant number of drugs fail to reach late-stage clinical trials owing to complications associated with formulation development. Moreover, strict regulations regarding the development of drugs are further contributing to the demand for outsourcing of formulation development. Such factors are expected to improve the demand for the formulation development outsourcing.
Contract services played a critical role in the COVID-19 response; however, with the incidence of the disease now significantly reduced, contract research organisations (CROs) and contract development and manufacturing organisations (CDMOs) are once again concentrating on the development of drugs for oncology and other disorders. For instance, in April 2022, LabCorp collaborated with Xcell Biosciences to support the company in developing cell and gene therapies for treating cancer, Parkinson’s disease and other rare diseases. Such initiatives by the CDMO’s are likely to promote the demand for the formulation development outsourcing of drugs used in the treatment of cancer and other rare diseases.
Based on the types of services, pre-formulation is expected to witness a CAGR of 6.8 percent between 2022 and 2030 (the forecast period) due to the growing demand for new drugs to tackle the high disease burden worldwide.
With regard to therapeutic area, the oncology segment is likely to witness the fastest CAGR of 8.4 percent over the forecast owing high burden of cancer worldwide, thus contributing demand for formulation development of new drugs.
The injectable products segment is expected to have the fastest CAGR of the formulation types, at 7.8 percent. According to the report, injectables are popular due to their high bioavailability.
Key players in the global formulation development outsourcing market include SGS SA, Intertek Group plc, Recipharm, Lonza, Charles River Laboratories International Inc, Eurofins Scientific SE, Catalent Inc, Thermo Fisher Scientific Inc. (Patheon), LabCorp and Element.