Contract Development and Manufacturing Organization Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Service Type CMO (Active Pharmaceutical Ingredient (API) Manufacturing, Finished Dosage Formulation (FDF) Development and Manufacturing, Secondary Packaging), By Research Phase CRO (Pre-clinical, Phase I, Phase II, Phase III, Phase IV), By Region and Competition, 2021-2031F

Market Overview

The Global Contract Development & Manufacturing Organization (CDMO and CMO) Market will grow from USD 245.47 Billion in 2025 to USD 363.86 Billion by 2031 at a 6.78% CAGR. Contract Development and Manufacturing Organizations and Contract Manufacturing Organizations provide comprehensive services to the pharmaceutical industry, ranging from early stage drug development to commercial production and packaging. The global market is primarily propelled by the increasing complexity of biologic therapies and a strategic focus on operational efficiency, which encourages innovators to delegate manufacturing to specialized partners. This reliance on external expertise is supported by robust funding in drug discovery. According to the European Federation of Pharmaceutical Industries and Associations, in 2024, the research driven pharmaceutical industry invested an estimated 55 billion Euros in R&D in Europe, creating substantial demand for outsourced technical services.

However, market expansion faces a significant challenge regarding supply chain resilience and regulatory compliance. Geopolitical tensions and evolving legislative frameworks are forcing companies to restructure their global supply networks. This often leads to capacity constraints and increased operational costs that can delay project timelines and impede the delivery of critical medicines.

Key Market Drivers

The rapid proliferation of biologics and Advanced Therapy Medicinal Products is fundamentally reshaping the market, driving a surge in demand for specialized manufacturing capabilities. As pharmaceutical companies prioritize the development of complex modalities such as antibody-drug conjugates and GLP-1 agonists, they increasingly depend on external partners to navigate technical challenges and scale production. This trend is evidenced by massive consolidation in the sector aimed at securing capacity; according to DCAT Value Chain Insights, December 2024, in the article 'CDMOs/CMOs: The Movers and Shakers of 2024', the largest market move was Novo Holdings' acquisition of Catalent for $16.5 billion to support the manufacturing of obesity treatments. Such high-value transactions underscore the critical role of contract organizations in the supply chain. Furthermore, major players are witnessing direct financial gains from this demand; according to Samsung Biologics, January 2025, in the 'Fourth Quarter and Fiscal Year 2024 Financial Results', the company recorded a full-year consolidated revenue of KRW 4.55 trillion, representing a 23% increase driven largely by expanded biologic production orders.

Concurrently, the market is heavily influenced by the reliance of small and emerging biotech companies on contract partners for end-to-end development support. These smaller entities often lack the internal infrastructure to manage the entire drug lifecycle and rely on CDMOs to progress from clinical trials to commercialization. This segment's activity is closely tied to the availability of capital, which has recently improved. According to Lonza, April 2025, in the 'Annual Report 2024', venture capital funding in the biopharma sector rebounded significantly, marking a strong year with over 20% year-on-year investment growth. This influx of capital enables emerging innovators to re-engage service providers, thereby sustaining a robust pipeline of early-stage projects that fuels the broader contract manufacturing industry.

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Key Market Challenges

Geopolitical tensions and the subsequent need for rigorous regulatory compliance present a substantial barrier to the growth of the Global Contract Development and Manufacturing Organization market. As governments enforce stricter legislative frameworks regarding national security and supply chain independence, pharmaceutical innovators face intense pressure to restructure their existing manufacturing networks. This forced migration from established partnerships creates operational bottlenecks, as decoupling from integrated service providers disrupts project continuity and inflates procurement costs.

These disruptions directly impede market momentum by delaying clinical timelines and limiting available production capacity in alternative regions. The magnitude of this dependency highlights the difficulty of rapid diversification. According to the Biotechnology Innovation Organization, in 2024, industry survey data revealed that approximately 79 percent of responding biopharmaceutical companies possessed at least one contract or product linked to a China-based development or manufacturing partner. Such high reliance on specific geographies means that shifting supply chains is a capital-intensive and slow process, effectively stalling broader market expansion as funds are diverted toward risk mitigation rather than new development programs.

Key Market Trends

The Integration of Artificial Intelligence and Digital Twin Technology is rapidly transforming the operational landscape of contract manufacturing, enabling providers to transition from simple execution partners to strategic technical innovators. By leveraging predictive algorithms and virtual process modeling, CDMOs can significantly compress technology transfer timelines and optimize batch yields before physical production begins. This digital maturity is becoming a decisive competitive factor, as it directly addresses the industry's need for efficiency and risk reduction in complex modalities. According to Contract Pharma, September 2025, in the article 'AI in Pharma Manufacturing: Trends & Applications Shortening Timelines', a study indicated that 49% of respondents reported operational benefits as the primary value sought with smart manufacturing strategies.

Concurrently, the Implementation of Sustainable Green Chemistry Practices has emerged as a critical requirement for market participants, driven by intensifying regulatory pressure and client mandates to reduce Scope 3 emissions. Contract organizations are actively re-engineering synthetic pathways and adopting renewable energy sources to align with the decarbonization goals of their pharmaceutical partners. Despite this strategic prioritization, the transition remains capital-intensive and operationally demanding for many providers. According to CPHI Online, July 2025, in the article 'Pharmapack 2025 Shows Industry's Green Transformation Challenges', the Pharmapack 2025 Strategic Insights & Research survey revealed that 76% of respondents cited resource constraints as the dominant barrier to effectively implementing sustainability initiatives.

Segmental Insights

Finished Dosage Formulation (FDF) Development and Manufacturing is currently the fastest-growing segment in the Global Contract Development & Manufacturing Organization (CDMO and CMO) Market. This expansion is primarily driven by the increasing complexity of modern therapeutics, such as biologics and sterile injectables, which require specialized formulation technologies to address solubility and bioavailability challenges. Pharmaceutical companies are prioritizing end-to-end outsourcing strategies to streamline supply chains and ensure rigorous compliance with standards from agencies like the U.S. Food and Drug Administration. Consequently, the demand for CDMOs capable of converting active ingredients into patient-ready final products is accelerating rapidly.

Regional Insights

North America dominates the global CDMO and CMO market due to a high concentration of established pharmaceutical and biotechnology enterprises prioritizing drug discovery. These companies increasingly outsource manufacturing processes to manage operational costs and access specialized capabilities without maintaining internal facilities. The region benefits from substantial research and development expenditure and a mature industrial infrastructure that supports complex production requirements. Additionally, the U.S. Food and Drug Administration establishes rigorous quality standards, fostering a reliable environment for outsourcing partnerships and consolidating North America’s position as the primary regional market.

Recent Developments

• In December 2024, Novo Holdings, a leading global life science investor, completed the acquisition of Catalent in an all-cash transaction valued at approximately $16.5 billion. As part of this strategic transaction, Novo Holdings arranged to sell three of Catalent’s fill-finish sites to Novo Nordisk, specifically those located in Anagni, Italy; Bloomington, Indiana; and Brussels, Belgium. This acquisition was designed to enhance the supply chain for critical pharmaceutical products while allowing Catalent to operate as a private entity. The move significantly strengthened the manufacturing capacity available to support the development and delivery of treatments to patients globally.
• In October 2024, Lonza completed the acquisition of a large-scale biologics manufacturing facility in Vacaville, California, from Roche for USD 1.2 billion. The facility, which features a total bioreactor capacity of approximately 330,000 liters, significantly expanded the company's mammalian manufacturing footprint in the United States. Following the closing, the contract development and manufacturing organization announced plans to invest an additional CHF 500 million to upgrade the site and add capabilities for next-generation therapies. This strategic expansion provided the company with immediate access to substantial new capacity on the West Coast to meet sustained customer demand.
• In April 2024, Fujifilm Diosynth Biotechnologies announced a significant investment of $1.2 billion to expand its large-scale cell culture manufacturing facility in Holly Springs, North Carolina. This additional funding was allocated to add eight 20,000-liter mammalian cell culture bioreactors, bringing the total investment in the site to over $3.2 billion. The project was designed to create a state-of-the-art end-to-end biopharmaceutical manufacturing facility capable of supporting the diverse needs of its partners. The expansion aimed to increase supply chain resiliency and provide the capacity necessary to deliver life-impacting medicines to patients in the United States and Europe.
• In March 2024, Samsung Biologics signed a new drug substance manufacturing contract with UCB, a Belgium-based biopharmaceutical company, valued at 382 billion Korean won ($288 million). This agreement expanded upon a long-term partnership that was originally established in 2017 and is set to continue until the end of 2030. Under the terms of the expanded deal, the contract development and manufacturing organization agreed to manufacture a clinical-stage anti-Tau candidate intended for the treatment of progressive supranuclear palsy. The collaboration highlighted the company's ability to leverage its massive production capacity to support complex biologic manufacturing requirements.

Key Market Players

• Lonza
• Catalent
• Thermo Fisher Scientific
• Samsung Biologics
• WuXi Biologics
• Recipharm
• Boehringer Ingelheim BioXcellence
• Jubilant Biosys / Jubilant Pharmova
• Fareva
• Rentschler Biopharma

Report Scope:

In this report, the Global Contract Development & Manufacturing Organization (CDMO and CMO) Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Contract Development & Manufacturing Organization (CDMO and CMO) Market, By Service Type CMO:

• Active Pharmaceutical Ingredient (API) Manufacturing
• Finished Dosage Formulation (FDF) Development and Manufacturing
• Secondary Packaging

• Contract Development & Manufacturing Organization (CDMO and CMO) Market, By Research Phase CRO:

• Pre-clinical
• Phase I
• Phase II
• Phase III
• Phase IV

• Contract Development & Manufacturing Organization (CDMO and CMO) Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE