How CDMOs Have Adjusted to Industry Changes Over The Years

 

As adaptable third-party service providers, CDMOs assist pharmaceutical businesses at all phases of the drug-making process – research and development, manufacturing, and formulation and finishing. Solid dose CDMOs (and other CDMO services) have grown in popularity over the previous decade, with consolidation and mergers and acquisitions (M&A) serving as major growth drivers.

According to recent research, over 2oo publicly disclosed M&A deals involving CDMO pharmaceutical companies occurred in the past five years. This result strengthened the position of another previous research that affirmed the same for previous years, albeit on a lesser scale. Another trend captured by the new result is current market consolidation. This shows how easily new developments affect the CDMO industry.

However, here is a key question – how exactly is this affecting CDMOs, or rather, how are CDMOs adjusting to the changes that are facing the economy?

Past

CDMOs have traditionally worked on a business strategy that has primarily focused on functioning as external service providers for the production of medicines. This concept involves the acquisition of production assets from pharmaceutical businesses to increase capacity. However, in recent years, CDMOs are progressively becoming innovators, covering more elements of the pharmaceutical sector as a whole. They are slowly becoming experts in not just manufacturing, but also generating new income sources.

Present

This shift in focus has coincided with a shift in the market's merger and acquisition environment. In the last decade, for example, novel modalities (such as gene therapies and cell therapies) and innovative vaccines gaining a rise has necessitated a significant investment in new manufacturing processes and capabilities for lipid-based formulations, nucleic acids, and viral vectors.

Well-positioned CDMOs have been able to adapt their production processes to match the growing demand for smaller, more varied projects. New collaborations have emerged, allowing CDMO players to drive the rapid increase of capabilities and capacities, assisting the sector in successfully ramping up in areas such as vaccine manufacturing.

Future

CDMOs are expected to expand their new position as technological pioneers. Smaller businesses and technology leaders are increasingly being incorporated into larger corporations. Product-focused enterprises are expected to continue moving toward the CDMO pharmaceutical company service market, while CDMOs are likely to expand their product offerings. Furthermore, CDMOs looking to penetrate high-value, low-volume markets such as personalized medicine might see the integration of clinical trial services as a sign to get into the market.

It is therefore a distinct but sure possibility that going forward, CDMOs are poised to become significant contributors to pharmaceutical sector innovation. Overall, CDMOs will likely continue to be important partners for pharmaceutical firms, and their rising technological skills and know-how along the value chain will increase their significance.

Conclusion

Progress and innovation in the pharmaceutical industry are getting increasingly common, and the CDMO sub-sector is a good example of that. Ensuring you pick the right CDMO is very important, and that is where Sovereign Pharmaceuticals comes in. Sovereign Pharmaceuticals is a CDMO pharmaceutical company that doubles as a liquid manufacturing CDMO among various other services that we offer. You can contact us to get started today.