Asia Pacific Pharmaceutical Contract Development and Manufacturing Organization (CDMO) Market was valued at US$ 60.82 billion in 2022 and is projected to attain a valuation of US$ 140.03 billion by 2031, growing at a CAGR of 9.9% during the forecast period from 2023 to 2031.
The Asia Pacific Pharmaceutical Contract Development and Manufacturing Organization (CDMO) market is on the brink of a remarkable surge in growth. This can be due to a multitude of factors, including the escalating demand for pharmaceutical products and the implementation of favorable government policies. The relentless adoption of cutting-edge manufacturing technologies is another crucial driver propelling the Asia Pacific CDMO market forward.
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The CDMO market in the Asia Pacific region is currently undergoing substantial growth, primarily driven by a surge in demand for pharmaceutical products. This increased demand can be due to various factors, including the region’s significant population growth, rising healthcare expenditures, and the expanding middle class.
With the Asia Pacific region being home to approximately 60% of the world’s population, including highly populated countries like China and India, the need for pharmaceutical products and services continues to rise. As the population in the region expands, so does the demand for healthcare solutions, leading to a favorable environment for the growth of the CDMO market.
Notably, pharmaceutical expenditures play a crucial role in the escalation of healthcare costs, accounting for a substantial portion of overall health expenditure in the Asia Pacific region. With an annual growth rate of 6%, spending on medicines has consistently outpaced general health spending by an average of 0.5 percentage points per year. Countries such as Vietnam, Thailand, Laos, China, and the Philippines have experienced particularly high annual growth rates in pharmaceutical expenditure, surpassing 9%.
Moreover, the public sector’s share of spending on medicines has also increased, reflecting the overall trend in health spending. Across the Asia Pacific region, pharmaceutical spending now accounts for 31% of public sector health expenditures, with even higher proportions observed in lower-middle-income countries. These factors collectively contribute to a conducive environment for the CDMO market’s growth in the Asia Pacific region.
Government Support: A Major Factor for Revenue Growth
The Asia Pacific Pharmaceutical Contract Development and Manufacturing Organization (CDMO) market is experiencing robust growth owing to strong government support. Governments in the region have introduced various initiatives, subsidies, and incentives to foster the growth and development of the pharmaceutical industry. This support plays a vital role in attracting foreign investments and creating a favorable business environment for CDMO companies.
Among the emerging markets in the region, China, India, and South Korea are expected to continue leading the Asia Pacific CDMO market. For instance, India’s pharmaceutical industry is the third-largest in the world by volume, valued at $50 billion. The country is a significant contributor to global drug exports, supplying medicines to over 200 countries.
To enhance resilience to external shocks and promote domestic production of critical bulk drugs and high-value products, the Department of Pharmaceuticals in India has launched three supporting schemes. These schemes incentivize both global and domestic players to invest and increase production in these product categories.
One of these schemes is the Production Linked Incentive (PLI) Scheme, which aims to promote domestic manufacturing of critical Key Starting Materials (KSMs), Drug Intermediates (DIs), and Active Pharmaceutical Ingredients (APIs) in India. The scheme has received approval for Production Linked Incentives of up to INR 6,940 crores.
With strong government support and initiatives like the PLI Scheme, the Asia Pacific CDMO market is well-positioned for continued expansion and success.
Technological Adoption Enhancing Efficiency and Quality of CDMO Providers
Technological advancements, such as the widespread adoption of artificial intelligence (AI), machine learning (ML), and automation, are set to revolutionize the services provided by Contract Development and Manufacturing Organizations (CDMOs) in the Asia Pacific region. These advancements will play a crucial role in enhancing the efficiency and quality of services, leading to improved productivity and reduced time-to-market for drugs.
The integration of AI and ML algorithms will enable CDMOs to analyze vast amounts of data quickly and accurately, facilitating better decision-making and process optimization. Automation will streamline manufacturing processes, leading to increased precision, reduced errors, and enhanced output quality. These advancements will improve operational efficiencies and enable CDMOs to deliver high-quality products and services to their clients.
The increasing demand for biosimilars and personalized medicines in the Asia Pacific region presents a significant opportunity for CDMOs with specialized expertise. Technological advancements can empower CDMOs to develop and manufacture complex biologics and personalized therapies more efficiently and effectively. AI and ML algorithms can aid in the design and optimization of bioprocesses, while automation technologies can enable precise and reproducible manufacturing of personalized medicines.
China Contributed Around 44% of Revenue Share to the Asia Pacific Pharmaceutical CDMO Market
China’s remarkable stronghold in the Asia Pacific Pharmaceutical Contract Development and Manufacturing Organization (CDMO) market can be due to a plethora of factors that have propelled its growth in recent years. As of 2021, China commanded a staggering 44% share of the market’s revenue. One of the key drivers behind this dominance is the nation’s vast and ever-expanding population, which has fueled an unprecedented surge in demand for pharmaceuticals and biologics. Consequently, China has witnessed the flourishing of a robust pharmaceutical industry, complete with a thriving ecosystem of CDMOs and ancillary service providers.
The sheer size and growth of China’s population have created a substantial market for pharmaceutical products. With over 1.4 billion people, the country presents an immense consumer base that continually demands a wide range of healthcare solutions. This soaring demand has prompted pharmaceutical companies to establish a strong presence in China, leading to the establishment of numerous CDMOs catering to both domestic and international markets.
Furthermore, China’s government has been proactive in fostering an environment conducive to the growth of the pharmaceutical industry. Favorable policies and incentives have encouraged investments in research and development, manufacturing capabilities, and infrastructure. This has attracted both domestic and foreign pharmaceutical companies to set up operations in China, further strengthening the country’s position in the CDMO market.
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China’s emphasis on innovation and technological advancement has also played a pivotal role in its dominance. The country has made significant strides in research and development, fostering the creation of cutting-edge pharmaceutical products and processes. This has bolstered the capabilities of Chinese CDMOs, enabling them to provide high-quality services and establish a reputation for excellence in the industry.
Additionally, China’s geographical proximity to other countries in the Asia Pacific region has positioned it as a strategic hub for pharmaceutical manufacturing and distribution. Its well-developed logistics infrastructure allows for efficient transportation of raw materials, finished products, and expertise, making it an attractive destination for pharmaceutical companies seeking cost-effective and streamlined operations.
List of Key Companies Profiled
- Aenova Group
- Almac Group
- Aphena Pharma Solutions
- Baxter Biopharma Solutions (Baxter International Inc.)
- Boehringer Ingelheim Group
- BDR Group
- Catalent Inc.
- Dalton Pharma Services
- Famar SA
- Recro Pharma, Inc. (IRISYS, LLC)
- Jubilant Life Sciences Ltd.
- Lonza Group AG
- Pfizer CentreSource (Pfizer Inc.)
- Recipharm AB
- Thermo Fisher Scientific Inc. (Patheon Inc.)
- Samsung BioLogics
- Stella Lifecare
- PPD Inc.
- Other Prominent Players
Market Segmentation Overview
By Service Type:
- Active Pharmaceutical Ingredient (API) Manufacturing
- Small Molecule
- Large Molecule
- High Potency API (HPAPI)
- Finished Dosage Formulation (FDF) Development and Manufacturing
- Solid Dose Formulation
- Liquid Dose Formulation
- Injectable Dose Formulation
- Drug Development Service
- Primary and Secondary Packaging Services
- Biologics Manufacturing Services
- Biologics API manufacturing services
- Biologics FDF manufacturing services
By Dosage Form-By State
- Liquid Dose Formulation
- Sterile Vials
- Single Use/Single Dose
- Prefilled Syringes
- Gas Dose Formulation
By Route of Administration
- Cardiovascular Disease
- Respiratory disease
- Other Disease
- Big Pharmaceutical Companies
- Small and medium-sized Pharmaceutical Companies
- Generic Pharmaceutical Companies
- Other End Users
- Australia & New Zealand
- South Korea
- Rest of Asia Pacific
- Rest of ASEAN
- Rest of Asia Pacific
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