Singapore, Feb 12, 2010: The global CMO market is set to grow steadily due to increased outsourcing of pharmaceutical production for western pharmaceutical manufacturers to Asian countries. The GBI Research in its latest research report published in December 2009 says that the global CMO market was valued at $21 billion in 2008. This market grew at around 9.5 percent in 2007 when the market was approximately $19.5 billion. The major factor driving this market is the increase in the sourcing of biologics and generic manufacturing. The market revenues are forecast to reach approximate $44 billion by 2015. The market is forecast to grow at a CAGR of 11 percent.

Business Monitor International (BMI), in its report published in October 2009 noted that the market for CMOs will increase from $22.2 billion in 2009 to $33.7 billion by 2014. The main reason for the growth is because the big pharma is seeking to reduce fixed costs associated with large manufacturing facilities. The fastest growing sector within the CMO market is predicted to be biologics, as it is increasingly becoming the mainstay of all leading pharma companies. Follow-on biologics market is predicted to grow rapidly in the coming years. However, manufacturing of biologics has higher barriers when compared to small molecules.

Manufacturing biologics requires more investment in infrastructure and it involves more complex processes. At present, CMOs with biologics capabilities are relatively few. The majority of the current biomanufacturing capacity is in North America.

However, this could change as Asia and other outsourcing regions grow faster. Indian companies such as Intas Biopharma, Wockhardt, Dr Reddy’s Labs, Biocon and Ranbaxy are now building up infrastructure to offer CMO services with biologics capabilities. Asian CMOs share of global facilities is predicted to increase from 10 percent in 2009 to 20 percent by 2013.

Top 10 global CMOs

1. Catalent (US)

2. Lonza (Switzerland)

3. Boehringer Ingelheim (BI) (Germany)

4. DSM (The Netehrlands)

5. Patheon (Canada)

6. Evonik (Germany)

7. Piramal Healthcare (India)

8. Jubilant Organosys (India)

9. Aenova (Germany)

10.Fareva (France)

Source: Business Insights

Read cover story here:  CMOs in India, China to grow at 20 percent

Read the interview with Mr. Sumanth at: "India and China have distinctive advantages in CMOs business"

Read Gus Abdallah's article at: A perspective on issues, challenges, solutions