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The contract research organization market size is estimated to grow by USD 63.35 billion at a CAGR of 12.61% between 2023 and 2028. The surge in Mergers and Acquisitions (M&A) among companies is a significant market driver, fundamentally transforming the Contract Research Organizations (CROs) industry landscape. This trend is fueled by the quest for strategic advantages and the pursuit of market leadership. Larger CROs are actively participating in M&A activities to fortify their positions, enhance their service capabilities, and broaden their geographical reach. Business strategies such as M&A enable CROs to expedite the research process, drug development, and other processes such as drug discovery outsourcing. One innovative technology that is increasingly being integrated into CROs through M&A activities is the preclinical isolated organ perfusion system. This advanced technology allows for the preservation and function of isolated organs outside the body, facilitating extensive research and testing in a controlled environment. By incorporating this technology, CROs can offer more comprehensive and efficient services to their clients, further solidifying their competitive edge in the industry.
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The market plays a pivotal role in today's pharmaceutical and biotechnology sectors, offering essential services like R&D outsourcing, clinical trial success rate enhancements, and the globalization of clinical trials. CROs enable pharmaceutical sponsors to streamline operations and improve efficiency by outsourcing critical functions such as clinical data management, protocol amendments, clinical trial support services, and risk-based monitoring. This outsourcing trend not only enhances operational flexibility but also ensures compliance with regulatory standards and accelerates drug development timelines. In fields like oncology research, CROs provide specialized expertise in conducting trials, managing data, and optimizing clinical trial logistics to advance treatments for cancer patients worldwide. As the biopharmaceutical industry continues to grow, CROs remain integral partners in driving innovation and improving patient outcomes through rigorous clinical development and strategic partnership initiatives. Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The increase in Mergers and Acquisitions (M&A) among companies is a significant market driver, fundamentally transforming the Contract Research Organizations industry landscape. This trend is fueled by the quest for strategic advantages and the pursuit of market leadership. Larger CROs are actively participating in M&A activities to fortify their positions, enhance their service capabilities, and broaden their geographical reach. Business strategies such as M&A enable CROs to expedite the research process, drug development, and other processes. One innovative technology that is increasingly being integrated into CROs through M&A activities is the preclinical isolated organ perfusion system in addition to drug discovery informatics. This advanced technology allows for the preservation and function of isolated organs outside the body, facilitating extensive research and testing in a controlled environment. By incorporating this technology, CROs can offer more comprehensive and efficient services to their clients, further solidifying their competitive edge in the industry.
For instance, in December 2021, Thermo Fisher acquired PPD, Inc. (PPD), a leading global provider of clinical research services to the biopharma and biotech industry. Therefore, an increase in M&A activities by market players will continue to drive the development of the market and, in turn, will propel the growth of the market during the forecast period.
Capacity utilization and constraints are the primary trend in the market. Capacity utilization is the extent of existing production corresponding with the potential production of the company when the capacity is completely utilized. Most CROs face a challenge with developing advanced downstream purification technologies, which are used for the recovery and purification of biosynthetic products compared with the production of biological drugs and biologic therapeutics. The high cost of downstream purification is further restricting the CROs from operating at their optimum capacity.
Moreover, factors such as the limited number of approved manufacturing facilities are also causing a capacity constraint. The shortage of cost-effective single-use products and the limitations of advanced cell culture systems for upstream performance are also causing constraints for the global market. Thus, such limitations may impede the market during the forecast period.
A shortage of skilled professionals is a challenge that affects the market. CROs require skilled personnel and appropriate training. Pharmaceutical and biotechnology manufacturing facilities and laboratories want to produce products in short time spans. Therefore, the lack of required skills leads to a high degree of non-compliance among laboratory professionals. In addition, the lack of skilled professionals is the root cause of non-compliance of laboratory safety workers and researchers, which negatively affects the manufacturing process and, ultimately, the quality of biopharmaceuticals.
Furthermore, CROs face challenges in attracting and retaining highly skilled professionals as they compete with pharmaceutical, biotechnology, and medical device companies and academic and research institutions for qualified and experienced scientists. Moreover, the shortage of skilled professionals will inhibit the adoption of new technologies, methodologies, and clinical trials. This will impede the market during the forecast period.
The Contract Research Organization market research and growth report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the Contract Research Organization market growth and forecasting report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
The CRO market forecasting report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The clinical research segment is estimated to witness significant growth during the forecast period. Clinical research services, a key offering of CROs, contain strategic planning, meticulous execution, and comprehensive oversight of clinical trials. CROs play a key role in providing compliance to regulatory guidelines, implementing rigorous monitoring, and maintaining data quality throughout the trial process.
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The clinical research segment was the largest segment and was valued at USD 28.47 billion in 2018. Research centers perform a broad range of tissue-based clinical research. The research operations are sponsored by key players or government entities, which, in turn, will help them to enhance R&D activities. Furthermore, CROs have been witnessing various developments to support clinical research. Thus, such factors will spur the growth of the segment and, in turn, the market during the forecast period.
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North America is estimated to contribute 40% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The market players such as Charles River Laboratories, Laboratory Corporation of America, and Parexel are some of the major CROs that are headquartered in the region and provide R&D services globally. Factors such as access to a large patient pool for various indications to conduct late-stage clinical trials are contributing to the regional market.
Furthermore, due to this significant growth of the biopharmaceutical and medical device industries in the US, the number of new products, such as drugs, vaccines, and medical disposables, is increasing. The increased number of products fuels the demand for safety, efficacy, and acceptance of the product, which is driving the demand for clinical trials. Due to the growing demand for clinical trials, there is a rise in clinical trial supplies by market players. Thus, this resulted in a rise in demand for the regional market during the forecast period.
The Contract Research Organization market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments.
The market plays a pivotal role in the pharmaceutical and biopharmaceutical industries by offering specialized services across various stages of clinical research and development (R&D). Pharmaceutical R&D, encompassing drug discovery and development, relies heavily on CROs to manage clinical trials efficiently. Outsourcing trends indicate a growing reliance on CROs due to their expertise and cost-effectiveness. Collaborative partnerships between CROs, pharmaceutical sponsors, and academic research institutes drive innovation in clinical trial protocols and adaptive trial designs.
In recent years, remote work has transformed CRO operations, enabling global collaborations and patient-centric trials. The focus on chronic disease treatment and infectious disease trials underscores the industry's response to global healthcare challenges. Industrialization impacts CRO services by improving R&D efficiency and data management through advanced technologies like AI and blockchain. Skill development programs address workforce shortages, ensuring quality assurance and regulatory compliance in clinical trial monitoring and pharmacovigilance. Basic literacy rates and socioeconomic factors influence real-world evidence studies and biomarker analysis, essential for drug safety monitoring and endpoint adjudication. Clinical trial logistics and budgeting are critical for managing R&D costs amidst stringent regulatory submissions. Moreover, the CRO market continues to evolve with a strong emphasis on patient outcomes and operational efficiency in pharmaceutical and biopharmaceutical research. mRNA synthesis raw materials are integral to advancing biotechnological processes and developing innovative mRNA-based therapies, which are increasingly pivotal in modern drug development. These raw materials enable the precise synthesis of mRNA molecules, facilitating breakthroughs in therapeutic areas such as infectious diseases, cancer immunotherapy, and genetic disorders, thereby enhancing the capabilities of clinical research organizations to deliver impactful outcomes.
Market Scope |
|
Market Report Coverage |
Details |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 12.61% |
Market Growth 2024-2028 |
USD 63.35 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
11.64 |
Regional analysis |
North America, Europe, Asia, and Rest of World (ROW) |
Performing market contribution |
North America at 40% |
Key countries |
US, Canada, Germany, UK, and China |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
BioAgile Therapeutics Pvt. Ltd, Charles River Laboratories International Inc., Clinical Trial Service B.V., CTI Clinical Trial and Consulting Inc., Ergomed Plc, Eurofins Scientific SE, Geneticist Inc., Hangzhou Tigermed Consulting Co. Ltd., ICON plc, IQVIA Holdings Inc., Konecranes, Laboratory Corp. of America Holdings, Linical Co. Ltd., Medpace Holdings Inc., Novotech Health Holdings, Parexel International Corp., Pharmaron Beijing Co. Ltd., Syneos Health Inc., Thermo Fisher Scientific Inc., and WuXi AppTec Co. Ltd. |
Market dynamics |
Parent market analysis, market forecast, market growth analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
Customization purview |
If our Contract Research Organization market report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Application
7 Market Segmentation by End-user
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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