Pharmaceutical Manufacturing Industry Overview
The global Pharmaceutical Manufacturing Market, valued at approximately $516.48 billion in 2022, is projected to grow at a compound annual growth rate (CAGR) of 7.63% from 2023 to 2030. The pharmaceutical industry has undergone a significant transformation driven by technological advancements, cost-efficient manufacturing techniques, and increased investment, all of which have positively influenced market growth. The integration of robotic technology and Artificial Intelligence (AI) has led to decreased downtime on manufacturing floors and reduced product waste, enhancing efficiency and productivity in pharmaceutical manufacturing processes.
Furthermore, the adoption of single-use disposable solutions has gained momentum, replacing conventional open-transfer manufacturing methods. This transition has streamlined operations and lowered the risk of contamination. Additionally, there has been a move towards integrated, intelligent, and data-rich paperless operations, resulting in more accurate and error-free production processes that ensure high-quality pharmaceutical products. These continuous developments within the industry have significantly contributed to advancements in drug manufacturing. Breakthroughs in personalized medicine have revolutionized the healthcare sector, creating new opportunities to target various health conditions and paving the way for patient-focused models.
Detailed Segmentation:
- Molecule Type Insights
In 2022, the conventional drugs (small molecules) segment generated the highest revenue share of over 54.9% and is estimated to grow rapidly over the forecast period. According to a November 2022 NCBI study, small-molecule drugs represent up to 90% of total global drug sales in terms of units. These figures highlight a significant dominance of small molecules in the global pharmaceutical market. Recent drug approvals by regulatory bodies worldwide further support this trend. Out of the 37 new drugs approved by the U.S. FDA in 2022, 19 were small molecule drugs, indicating their prominent position in the market.
- Drug Development Insights
The outsourcing segment dominated the pharmaceutical manufacturing market and accounted for a revenue share of over 53.5% in 2022. This segment is poised for lucrative growth in the future due to several associated benefits. Outsourcing operations offer numerous advantages, such as reduced investments, lower drug development and overall costs, increased manufacturing efficiency, and easier compliance with regulatory norms. In addition, the integration of Robotic Process Automation (RPA) by contract manufacturers has greatly accelerated drug development processes.
- Formulation Insights
The growth of the sprays segment can be attributed to the increasing number of approvals for auto-injectors and prefilled syringes. Moreover, in recent years, subcutaneous injections have gained considerable popularity among device manufacturers, drug developers, and patients. These injections offer various benefits, and ease of use, including self-administration, reliability, precision, fixed doses in prefilled syringes, compliance, compact design, and high patient comfort. The emergence of subcutaneous injections is anticipated to further fuel the injectable segment growth.
- Route of Administration Insights
The oral route of administration segment dominated the market and accounted for a revenue share of 58.0% in 2022. Oral dosage forms are preferred due to their affordability, ease of manufacturing, and patient-friendly administration. Furthermore, advancements in drug delivery technologies such as targeted drug delivery and sustained release formulations have enhanced the availability of orally administered drugs in the market. The parenteral segment is expected to register the fastest CAGR over the forecast years.
- Therapy Area Insights
The other diseases segment comprises immunological diseases, infectious diseases, musculoskeletal conditions, women’s health, and eye disorders, as well as other therapeutic areas. The segment captured a revenue share of over 63.44% in 2022 and is expected to maintain its leading position throughout the forecast period. The COVID-19 pandemic has played a significant role in driving R&D expenditure in this segment. Furthermore, increasing awareness about women's health has prompted operating players to focus on developing therapies to address key conditions in women, such as menstrual irregularities.
- Prescription Insights
The prescription medicines segment dominated the marketwith a revenue share of 83.76% in 2022 and is projected to expand at a significant CAGR over the forecast period. This growth can be attributed to the increasing expenditures on prescription drugs worldwide. The American Journal of Health-System Pharmacy reports that prescription drug spending in the U.S. has risen 4-6% over the past decade. The Over-The-Counter (OTC) medicines segment has witnessed significant transformation due to factors, such as the demand for cost-effective treatment options and self-medication.
- Age Group Insights
The geriatric segment dominated the market and accounted for a revenue share of approximately 49.83% in 2022. According to the World Population Prospects, one in 11 individuals was aged 65 years or older in 2021. This proportion is expected to increase to one in six individuals by 2050, highlighting the significant growth potential of the geriatric segment. In addition, pediatric medicine has experienced notable advancements through the development of specialty drugs under the Orphan Drug Act. Initiatives, such as the Pediatric Research Equity Act (PREA) and the Best Practices for Children Act (BPCA), have played a crucial role in promoting the development of pediatric medicines. PREA serves as a checkpoint during FDA drug approval, ensuring the focus on pediatric medicine.
- Sales Channel Insights
The retail segment dominated the market and accounted for a revenue share of 77.51% in 2022. With the rise in medical costs and health insurance premiums, more individuals are opting for self-medication to address minor health issues. The convenience and cost-effectiveness of OTC medicines have contributed to their popularity among consumers. As a result, there has been a significant increase in the adoption of drugs from retail stores, driving the growth of this segment. Specialty pharmacy has witnessed significant growth in recent years, leading to the availability of a wide range of specialty drugs in retail pharmacies. This expansion of offerings further contributes to the growth of the retail segment.
- Regional Insights
North America dominated the marketand accounted for a significant revenue share of 42.38% in 2022. This can be attributed to the numerous strategic partnerships formed among established and early-stage pharmaceutical companies in the region. The U.S., in particular, held a prominent position in terms of per capita prescription drug spending on a global scale. Additionally, the U.S. accounted for the largest number of drug efficacy studies and clinical trials conducted worldwide. The Asia Pacific region is expected to witness the highest growth rate during the forecast period.
Gather more insights about the market drivers, restraints, and growth of the Pharmaceutical Manufacturing Market
Key Companies & Market Share Insights
Leading companies in the industry have implemented strategic initiatives to enhance their market presence and gain a competitive advantage. These key players are actively involved in various activities, such as product development, collaboration & partnership models, agreements, business expansion, and mergers & acquisitions. These initiatives aim to strengthen their product portfolio and meet the growing demand for pharmaceutical products.
For instance, in June 2023, Pfizer, Inc. and Samsung Biologics entered into a strategic partnership for the long-term manufacturing of biosimilars. Under the agreement, Pfizer will be provided with additional manufacturing capacity by Samsung Biologics for a biosimilar portfolio comprising immunology, oncology, and inflammation. Both companies partnered initially in March 2023 for a manufacturing agreement for Pfizer’s product.
Some prominent players in the global pharmaceutical manufacturing market include:
- F. Hoffmann-La Roche Ltd.
- Novartis AG
- GlaxoSmithKline plc
- Pfizer, Inc.
- Merck & Co., Inc.
- AstraZeneca
- Johnson & Johnson
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