How to digitally transform as a Contract Development Manufacturing Organization
Contract Development Manufacturing or Contract Research & Manufacturing Services Organizations take-over more and more activities from “traditional” Life Sciences companies. CDMO services span from Drug Formulation Development, Clinical Trial Services, API production, drug product production to packaging operations.
Recent studies predict a growth of approximately 7% CAGR resulting into a total revenue of around 160 billion $ of all global CDMO business in 2025 and therefore 2-3%-points above end-market. Growth is mainly driven by three drivers:
- Pharma companies put stronger focus on their core competencies (product development and distribution) and development of complex drugs incl. biologics
- Increasing focus on integrated end-to-end CDMO offering
- (Continuous) increase of regulatory requirements for the CDMO sector
As the overall CDMO business will significantly grow over the upcoming years CDMOs need to digitally transform to become agile, resilient and flexible enterprises to cope with dynamic client requirements. Even after a consolidation in last few years, the current CDMO market is still rather fragmented by multiple regional small-medium size players world-wide.
But this will change over the next 3-7 years. CDMOs will acquire other niche players to improve their service offering and reduce Supply Chain costs. But also Private Equity funds identified the CDMO market as highly interesting field to play. There will be massive and permanent consolidation and Merger & Acquisition activities.
(Source: PharmSource Trend Report, 2020)
Many thanks go to Marco Gorgas for contributing to this article with all the CDMO market insights.
Marco Gorgas, former COO Aenova Group and Managing Director AGM LifeSciences GmbH: (1) Marco R. Gorgas | LinkedIn
Please reach out to our Life Sciences CDMO experts to find out more -> Process & Value Chain Consulting for Life Sciences | Tenthpin
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