Biotechnology/Pharmaceutical Services Outsourcing Market Worth $92.9 Billion By 2025
The global biotechnology services outsourcing market
is expected to reach USD 92.9 billion by
2025, according to a new report by Grand View Research, Inc. Pharmaceutical
industry has been adaptive of the function of outsourcing certain clinical and
corporate functions as early as 2002. Among the services outsourced, clinical
trial management and contract manufacturing were the forerunners. For instance,
Johnson & Johnson was the first pharmaceutical company to outsource its
applications development and maintenance (ADM).
Multiple therapeutic regimens are being followed across the
globe in attempts to come up with a reliable treatment for Covid-19. One line
of treatment includes the use of hydroxychloroquine, while a second treatment
line focuses to use antiviral drugs used in the disease management of HIV. Both
these approaches have surged demand from advanced antivirals and antimalarial
drugs. This impacts the drug manufacturers as an off label indication for these
drug classes has to be worked upon. At the moment, the WHO has not prescribed
any of these approaches, neither they have commented if one is better than the
other. The report will account for Covid19 as a key market contributor.
In 2015, over USD 50.0 billion was spent on pharmaceutical
R&D activities majorly on oncology, diabetes, and autoimmune therapy
classes, which is expected to propel the biotechnology services outsourcing
market growth over the forecast period.
Numerous factors are
driving the demand for outsourcing consulting services within the healthcare
industry. Few of them are enlisted below:
- Increasing globalization facilitating product launches in
new geographies having varying regulatory policies
- Rising activities such as mergers, take-overs, patent
filing, and in-licensing
- Lining up of product pipelines requiring assistance in
marketing and post-marketing maintenance
- Strengthening of regulatory compliance and amendments of
by-laws
- Accelerated pace of changes in regulatory environment
- Strong growth of outsourcing market
- Increasing benefits in outsourcing such as cost
efficiency, core competency focus, improved ROI and profit margins, reduced
documentary burden and others.
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Shrinking profit margins coupled with rising competition in
the market space, and augmenting regulatory burden are other vital impact
rendering factors. The pharmaceutical services outsourcing market is expected
to register growth at a CAGR of 8.7% during the forecast period. On the other
hand, pending immigration legislations in the U.S. may hinder business
economics and outsourcing risks.
Further key findings from the study suggest:
·
Consulting services are inclusive of
regulatory compliance, remediation, and quality management systems consulting,
which is expected to dominate the pharmaceutical services outsourcing market in
2025.
·
In 2013, the U.S. FDA revised the
guidelines for registration trials of drugs used in the treatment of acute
bacterial skin and skin structure infections, thereby promoting growth of
regulatory affairs services.
·
Other services such as contract
manufacturing, product upgrade, and IT consulting services are projected to
grow swiftly. Increasing focus on generic medicine and regional expansions in
developing regions are some of the key contributing factors
·
Presence of cheap labor, skilled personnel
and rapid growth of the pharmaceutical industry within the Asia Pacific region
presents numerous opportunities for service providers, thereby representing a
lucrative growth rate over the forecast period.
·
Service based expertise may be found in
players such QuintilesIMS, Parexel Corporation, Lachman Consultant Services,
Inc., Concept Heidelberg GmbH, and others. These players compete on the basis
of service quality, competitive pricing, and long-term relations with healthcare
industry participants.
Drug
discovery and development is an integral sustainability strategy adopted by
pharmaceutical manufacturers. Growing prevalence of chronic and long-term
diseases has heightened the need for new drug development via extensive R&D
investments. According to the estimates of PhRMA, the total drug development
related R&D spending in 2014 amounted to USD 51.2 billion.
Growing clinical trial failure rates coupled with increasing
drug development costs cause huge loss in revenue for manufacturers. Statistics
suggest that the failure rates of phase II clinical trials have increased from
82.0% in 2008 to 89.0% in 2012. Major reasons for these failures include low
efficacy and safety concerns. These are taken care of by outsourcing companies
thereby allowing better positioning of the pharmaceutical industries in
R&D.
The higher level of expertise is anticipated to boost the demand
for these services. Availability of well-established clinical research
organizations, regulatory outsourcing firms, management consulting firms, and
contract manufacturers is catering to complex demand of pharmaceutical and
biotechnological sectors.
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Grand View Research has segmented the
global biotechnology/pharmaceutical services outsourcing market on the basis of
service:
Global Biotechnology/Pharmaceutical
Services Outsourcing Service Outlook (Revenue, USD Million, 2014-2025)
·
Consulting
·
Auditing & assessment
·
Regulatory affairs
·
Product maintenance
·
Product design & development
·
Product testing & validation
·
Training & education
·
Others
About Grand View Research
Grand View Research, Inc. is a U.S.
based market research and consulting company, registered in the State of
California and headquartered in San Francisco. The company provides syndicated
research reports, customized research reports, and consulting services. To help
clients make informed business decisions, we offer market intelligence studies
ensuring relevant and fact-based research across a range of industries, from
technology to chemicals, materials and healthcare.
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