Europe Pharmaceutical Contract Manufacturing Market Size (2024 - 2029)

The Europe Pharmaceutical Contract Manufacturing Market is experiencing growth driven by the need for pharmaceutical companies to outsource manufacturing due to stringent regulations and pricing pressures. The market's expansion is supported by companies seeking to enhance their production capabilities and global presence through outsourcing. However, the market's growth is challenged by strict regulatory requirements, such as compliance with EU Good Manufacturing Practices, which can impede progress. The impact of external factors, such as economic downturns and the Covid-19 pandemic, has also influenced the market dynamics, affecting supply chains and demand for generic medicines.

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Market Size of Europe Pharmaceutical Contract Manufacturing Industry

Europe Pharmaceutical Contract Manufacturing Market Summary
Study Period 2019 - 2029
Base Year For Estimation 2023
Market Size (2024) USD 43.02 Billion
Market Size (2029) USD 54.94 Billion
CAGR (2024 - 2029) 5.01 %
Market Concentration Medium

Major Players

Europe Pharmaceutical Contract Manufacturing Market Major Players

*Disclaimer: Major Players sorted in no particular order

Europe Pharmaceutical Contract Manufacturing Market Analysis

The Europe Pharmaceutical Contract Manufacturing Market size is estimated at USD 43.02 billion in 2024, and is expected to reach USD 54.94 billion by 2029, growing at a CAGR of 5.01% during the forecast period (2024-2029).

  • By outsourcing production, pharmaceutical companies can focus on core competencies like research and development, marketing, and sales. Contract manufacturers bring expertise, state-of-the-art facilities, and cost-effective operations, allowing pharma companies to accelerate time-to-market, increase production capacity, and reduce operational costs. These benefits are encouraging pharmaceutical firms to opt for contract manufacturing.
  • Furthermore, pharmaceutical companies are increasing their R&D expenditures. The level of R&D spending is a crucial indicator of a pharmaceutical company's commitment to drug discovery. Consequently, increased government investments in pharmaceutical R&D are expected to enhance research activities, improve the conversion of products into market-ready forms through pharmaceutical contract manufacturers, and drive the market's growth. For instance, according to the European Federation of Pharmaceutical Industries and Associations (EFPIA) and Pharmaceutical Research and Manufacturers of America (PhRMA), the pharmaceutical research and development spending annual growth rate in Europe registered a growth rate of 6.7% in 2019-2023 increased from 3.7% in 2014-2018.
  • However, in Europe, the pharmaceutical industry's preference for maintaining control over manufacturing processes is limiting the market's growth. Despite the cost savings and operational efficiencies that outsourcing offers, companies are reluctant to give up control over critical production aspects. This hesitation is primarily due to concerns about intellectual property protection, quality standards, and supply chain reliability.
  • Contract-based manufacturers in the United Kingdom encounter challenges due to the political implications of the United Kingdom's departure from the EU. UK/EU-based CMOs must adhere to rigorous testing protocols for various products under two regulatory frameworks. The government is promoting increased exports to diversify the UK economy away from its traditional reliance on financial services and credit-driven spending. As a result, pharmaceutical companies with limited production capacities may seek to outsource parts of their manufacturing operations, thereby increasing the demand for CMOs.
  • The pandemic had a varied impact on the market studied, further driving its growth in the region. This was primarily due to the increased demand for vaccines, therapeutics, and personal protective equipment, which strained manufacturing capacities. As a result, contract manufacturers expanded production to meet the demand. However, supply chain disruptions, labor shortages, and regulatory challenges posed some obstacles.

Europe Pharmaceutical Contract Manufacturing Industry Segmentation

Pharmaceutical contract manufacturing involves outsourcing the production of pharmaceutical products to specialized third-party manufacturers and handles various stages of drug production, including APIs, synthesis, formulation development, and finished dosage form manufacturing.

The European pharmaceutical contract manufacturing market is segmented by service type (active pharmaceutical ingredient (API) manufacturing, finished dosage formulation (FDF) development and manufacturing (solid dose formulation, liquid dose formulation, and injectable dose formulation), and secondary packaging), and by country (United Kingdom, Germany, France, Italy, and Rest of Europe). 

The market sizes and forecasts are provided in terms of value (USD) for all the above segments.

By Service Type
Active Pharmaceutical Ingredient (API) Manufacturing
Finished Dosage Formulation (FDF) Development and Manufacturing
Solid Dose Formulation
Liquid Dose Formulation
Injectable Dose Formulation
Secondary Packaging
By Country
United Kingdom
Germany
France
Italy
Rest of Europe
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Europe Pharmaceutical Contract Manufacturing Market Size Summary

The European pharmaceutical contract manufacturing market is poised for significant growth, driven by a combination of regulatory pressures and strategic industry shifts. Companies are increasingly outsourcing manufacturing to navigate stringent EU regulations and to focus on research and development. This trend is particularly evident in Germany, where local firms are expanding their global footprint by leveraging contract manufacturing organizations (CMOs) to enhance production capabilities. The market is also influenced by economic challenges, such as the Euro crisis and patent expirations, which have prompted companies to seek cost-effective solutions in emerging markets. Despite these challenges, the UK remains a key player in the market, benefiting from its highly skilled workforce and robust intellectual property regulations, which support the growth of the injectables segment.

The market landscape is characterized by a few dominant players, including Fareva Holdings SA, Recipharm AB, and Boehringer Ingelheim Group, who hold significant market shares. These companies are investing heavily in expanding their manufacturing capacities to meet the growing demand for innovative medicines. The European Commission's efforts to strengthen the pharmaceutical industry's innovation capabilities, alongside the UK's strategic investments in R&D and manufacturing, underscore the region's commitment to maintaining its leadership in global healthcare. However, the market faces challenges such as the need to comply with rigorous EU Good Manufacturing Practices and the political implications of Brexit, which necessitate adherence to dual regulatory frameworks. Despite these hurdles, the European pharmaceutical contract manufacturing market is expected to continue its upward trajectory, supported by ongoing investments and strategic partnerships.

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Europe Pharmaceutical Contract Manufacturing Market Size - Table of Contents

  1. 1. MARKET INSIGHTS

    1. 1.1 Market Overview

    2. 1.2 Industry Attractiveness - Porter's Five Forces Analysis

      1. 1.2.1 Bargaining Power of Suppliers

      2. 1.2.2 Bargaining Power of Consumers

      3. 1.2.3 Threat of New Entrants

      4. 1.2.4 Intensity of Competitive Rivalry

      5. 1.2.5 Threat of Substitutes

    3. 1.3 Industry Value Chain Analysis

    4. 1.4 Industry Policies

    5. 1.5 Assessment of the Impact of Macro-economic Factors on the Market

  2. 2. MARKET SEGMENTATION

    1. 2.1 By Service Type

      1. 2.1.1 Active Pharmaceutical Ingredient (API) Manufacturing

      2. 2.1.2 Finished Dosage Formulation (FDF) Development and Manufacturing

        1. 2.1.2.1 Solid Dose Formulation

        2. 2.1.2.2 Liquid Dose Formulation

        3. 2.1.2.3 Injectable Dose Formulation

      3. 2.1.3 Secondary Packaging

    2. 2.2 By Country

      1. 2.2.1 United Kingdom

      2. 2.2.2 Germany

      3. 2.2.3 France

      4. 2.2.4 Italy

      5. 2.2.5 Rest of Europe

Europe Pharmaceutical Contract Manufacturing Market Size FAQs

The Europe Pharmaceutical Contract Manufacturing Market size is expected to reach USD 43.02 billion in 2024 and grow at a CAGR of 5.01% to reach USD 54.94 billion by 2029.

In 2024, the Europe Pharmaceutical Contract Manufacturing Market size is expected to reach USD 43.02 billion.

Europe Pharmaceutical Contract Manufacturing Market Report Snapshots

Europe Pharmaceutical Contract Manufacturing Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)