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Home » Report: global life sciences BPO market to reach $596B globally by 2019

Report: global life sciences BPO market to reach $596B globally by 2019

February 5, 2014
CenterWatch Staff

According to a new market report published by Transparency Market Research, a global market intelligence company providing global business information reports and services, the global life sciences BPO market was valued at $152.5 billion in 2012 and is estimated to reach a market value worth $596 billion in 2019, growing at a CAGR of 21.5% from 2013 to 2019.

Rising cost, growing complexities of conducting clinical trials and increased pressure from regulatory agencies to adopt various techniques to minimize the costs involved for successful introduction of a drug in the market has compelled pharmaceutical players to adopt new outsourcing models. All these factors have helped fuel market growth of the life sciences BPO industry in the past decade.

In addition, rise in the number of patent expirations and failure of drugs during the clinical trials process has triggered the overall growth of the pharmaceutical outsourcing industry. Moreover, outsourcing aids the biotech and pharmaceutical industry to focus on their core strategies and utilize their internal resources for more critical in-house projects.

Contract Manufacturing Organizations (CMOs) outsourcing services account for the largest segment of the overall life sciences BPO market. Growing healthcare costs has led to a rise in the demand for generic drugs and this has consequently led to growth in demand for active pharmaceutical outsourcing services.

Moreover, CMOs conduct internal R&D to come up with novel technologies to further support their clients. The API manufacturing market accounts to be largest segment of the total CMO market. This growth has been attributed to increase in outsourcing activities for pharmaceutical manufacturing outsourcing, owing to increasing regulatory compliance such cGMP and other approvals. Manufacturers do not have all the technologies and experience available in-house required for manufacturing different APIs and hence, outsourcing serves as a more cost effective solution for pharmaceutical companies. Also, the growing importance of biological drugs calls for distinctive manufacturing technology.

The CROs outsourcing services market also has witnessed significant growth in the past decade. This growth has been attributed to the rising costs involved in conducting various phases of clinical trials ranging from drug discovery up to post marketing approvals. Pharmaceutical companies now are opting to outsource their clinical trial activities to vendors capable of providing bundled services such as regulatory services, clinical data management, medical writing, site management, pharmacovigilance, risk based monitoring, biostatics and protocol development. The drug discovery services segment accounted for the largest market share in 2012.

Since a large number of molecules fail during the drug discovery process, through outsourcing to CROs pharmaceutical companies are mitigating their financial risks and avoiding sunken costs. However, clinical data management outsourcing services market is expected to foresee the highest growth rate of 17.3% from 2013 to 2019. This high growth has been attributed to the growing adoption of advanced IT services such cloud applications and enhanced software services provided by Information Technology Outsourcing (ITO). Data security and Intellectual Property Rights (IPR) still are major hindrance for growth of this industry.

Geographically, North America accounted for the largest share of the global pharmaceutical outsourcing services market in 2012, valued at $28.4 billion in 2012, followed by Asia-Pacific. The Asian-Pacific region is expected to represent the highest growth rate of 21.2% during the forecast period due to the availability of trained resources, low-cost labor, favorable regulatory policies and a huge patient pool suffering from various chronic diseases. Moreover, the companies from this region now are meeting the required manufacturing and quality standards of the FDA and EMA to further boost market growth.

Global News CROs/Service Providers

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