What is the global market size of Drug Discovery Outsourcing Market?

Global Drug Discovery Outsourcing Market size was valued at USD 3.26 billion in 2019 and is poised to grow from USD 3.5 billion in 2023 to USD 6.2 billion by 2031, growing at a CAGR of 7.3% in the forecast period (2024-2031).

What is the key driver of Global Drug Discovery Outsourcing Market?

The rising R&D expenditure of pharmaceutical and biopharmaceutical companies is prompting them to opt for fully integrated or functional outsourcing services, from the early development stage to the late-stage development phase, for drug discovery and development. As there is enormous pressure on pharma companies to contain fixed costs, outsourcing has evolved as a strategic alternative to overcome the lack of in-house resources required for new product development.

What is the key market trend for Global Drug Discovery Outsourcing Market?

Increasing number of small and medium-sized companies are outsourcing drug discovery services, thus the value chain of drug discovery outsourcing market will have new growth opportunities in the coming years.

Which region accounted for the largest share in Global Drug Discovery Outsourcing Market?

North America held the largest global drug discovery outsourcing market in 2021. The United States dominates North America market. As per the CDC, I.e., the Centers for Disease Control and Prevention, around 1.7 million new cancer cases were reported in 2019 in the US, and about half a million people died of cancer. For every 100,000 individuals in the US, there are 439 new cancer cases and 146 cancer deaths. Furthermore, the large presence of contract research organizations will positively contribute to the growth of the cancer immunotherapy drug discovery outsourcing market.

Drug Discovery Outsourcing Market Size

Q: Who are the key vendors in the Global Drug Discovery Outsourcing Market?

Global Drug Discovery Outsourcing Market is highly fragmented with the presence of several small and large market players operating all over the world. Major companies of the market are implementing on several business strategies such as new product launches, acquisition & mergers, collaboration, and partnerships for the expansion of their geographical presence and their product portfolio. 'Eurofins Scientific SE', 'Charles River Laboratories International, Inc.', 'Covance, Inc.', 'Eurofins Scientific SE', 'GenScript Biotech Corporation', 'WuXi AppTec Co., Ltd.', 'Jubilant Biosys Ltd.', 'Albany Molecular Research Inc.', 'Syngene International Ltd.', 'Piramal Pharma Solutions', 'Viva Biotech Holdings', 'Pharmaron Beijing Co., Ltd.', 'Evotec SE', 'AMRI Global', 'Aurigene Discovery Technologies Ltd.', 'GVK Biosciences Private Limited', 'HitGen Inc.', 'Insilico Medicine, Inc.', 'Nuevolution A/S', 'Selvita S.A.', 'Shanghai ChemPartner Co., Ltd.'

Drug Discovery Outsourcing Market Insights

Drug Discovery Outsourcing Market size was valued at USD 3.6 Billion in 2023 and is poised to grow from USD 3.86 Billion in 2024 to USD 6.75 Billion by 2032, growing at a CAGR of 7.2% during the forecast period (2025-2032).

High outsourcing costs and stringent government regulations are major barriers to the drug discovery outsourcing market growth. In contrast, cancer, genetic diseases, chronic diseases, more elderly people, better legal environment, cheaper skilled labor with higher levels of information are expected in developing countries will provide drug discovery outsourcing market opportunities for growth during the forecast period.

According to a survey conducted by Life Science Strategy Group of 120 clinical development decision-makers in the U. S., Europe, and China, industry professionals are undertaking major strategic changes to maintain their drug discovery outsourcing market share in the unpredictable scenario post COVID-19 pandemic. The pharmaceutical industry has seen a lot of change over the last two decades, in terms of changes in biopharmaceutical formulations, cancellation of patents and some decreases in big drugs. Breaking down the various stages of drug discovery, such as hit confirmation, lead generation, lead optimization and high-speed testing will allow players to specialize in their core services.

The drug discovery outsourcing market is growing exponentially, with the rise of pharmaceuticals and the need for cost-effective solutions in pharmaceutical biotechnology companies driving the expansion of this drug discovery outsourcing market. Several factors, such as increasing R&D costs, the need to develop more efficient and unique drug discovery methods, and advanced technologies such as artificial intelligence (AI) and the increased use of learning in pharmaceutical research has moved pharmaceutical companies from internal R&D programs to outsourcing services.

US Drug Discovery Outsourcing Market is poised to grow at a sustainable CAGR for the next forecast year.

FAQs

The competitive environment in the drug discovery outsourcing industry is evolving rapidly, with key players leveraging technological advances, strategic collaboration and regional expansion to stay ahead. Increasing demand for specialized services, especially in the biological and AI-driven discovery sectors, as well as growing markets. The market is also characterized by increasing competition where cost is a key factor characterized by established factor CROs such as LabCorp, Charles River, WuXi AppTec continues to lead the drug discovery outsourcing market. But emerging players and local areas gain momentum by providing pricing, specialized services and cost-effective talent pools. Continued trend in integration driven on acquisitions and partnerships is likely to shape the future growth of the market, offering more integrated and innovative solutions for pharmaceutical companies operating. 'Charles River Laboratories International, Inc. ', 'WuXi AppTec Co., Ltd. ', 'Laboratory Corporation of America Holdings (LabCorp) ', 'Evotec SE ', 'Covance Inc. ', 'Thermo Fisher Scientific Inc. ', 'Eurofins Scientific ', 'Pharmaron Beijing Co., Ltd. ', 'Syngene International Ltd. ', 'Genscript Biotech Corporation ', 'ChemPartner ', 'Jubilant Biosys Ltd. ', 'ICON plc ', 'QuintilesIMS (IQVIA) ', 'Cambrex Corporation ', 'Viva Biotech ', 'Domainex Ltd. ', 'Curia Global, Inc. (formerly Albany Molecular Research, Inc.) ', 'Tecan Group Ltd. ', 'Shanghai Medicilon Inc.'

Increasing pressure to reduce pharmaceutical costs is a major drug discovery outsourcing market trend. Pharmaceutical companies are under constant pressure to streamline their operations and increase their investments in research and development (R&D). By outsourcing drug discovery processes such as target identification, screening, lead optimization, and preclinical testing, pharmaceutical companies can significantly reduce inventory costs, labor costs, and overhead costs. Additionally, it enables contract research organizations (CROs) resources with the latest technology, state-of-the-art equipment and specialized expertise to accelerate drug discovery. This model provides significant, sustainable operational and financial benefits for acceptance in the biopharmaceutical industry.

Increased Focus on Biopharmaceutical Outsourcing: A major trend in the drug discovery outsourcing market is an increasing focus on biopharmaceutical outsourcing, gene therapy, cell-based for their efficacy in treating complex chronic diseases. The demand for medicinal and other biological products is growing rapidly. Biopharmaceutical companies often lack the resources or know-how to develop these products in their home, leading to demand for specialized outsourcing services. This trend toward expanding outsourcing with CROs and contract development organizations (CDMOs). This is because these specialized services help simplify drug discovery, improve product quality and reduce time to market for biopharmaceuticals.

As per the drug discovery outsourcing market outlook, North America dominated the market and had the largest share of over 35.5% in global revenue. Regional market growth can be attributed to technological advances, well-established research infrastructure & presence of key players, and more investment in drug discovery. The industry is emerging as a destination for drug discovery outsourcing due to skilled manpower, low costs, favorable regulatory environment and quality of information. Chronic disease affects an estimated 60% of the population, with chronic conditions comprising one or more such diseases in approximately half the US population. The rising awareness about the biologics is fueling demand for innovative drugs in the region, thereby supporting North America drug discovery outsourcing market growth.