U.S. COMPOUNDING PHARMACIES MARKET ANALYSIS

Market Size and Trends

The U.S. compounding pharmacies market is estimated to be valued at USD 5,290.4 Mn in 2024 and is expected to reach USD 7,995.8 Mn by 2031, exhibiting a compound annual growth rate (CAGR) of 6.1% from 2024 to 2031.

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The compounding pharmacies market is expected to witness positive growth over the forecast period. Factors, such as increasing demand for personalized medicines, growth in chronic diseases, and rise in geriatric population, are expected to drive the market growth during this period. With a rise in demand for compounded drugs, especially medications requiring a specific dose, delivery method, or ingredient combination, market players are expected to gain opportunities. However, lack of regulations regarding compounding pharmacies and drug recalls pose challenges to market players. Overall, increasing need for personalized care is expected to boost the U.S. compounding pharmacies market between 2024 and 2031.

Increasing Demand for Hormone Replacement Therapy

Increasing demand for hormone replacement therapy (HRT) is expected to boost the growth of the U.S. compounding pharmacies market over the forecast period. For instance, according to data published on September 2021, in the National Library of Medicine, in the U.S., in 2018, about four out of 10 women aged 70-79 years reported having had a hysterectomy.

Market Concentration and Competitive Landscape

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Increasing adoption of inorganic growth strategies, such as acquisitions, is expected to drive the market growth over the forecast period. For instance, on April 10, 2024, Myonex, a global clinical trial supply company, announced that it had acquired Saveway Compounding Pharmacy, a compounding pharmacy in Delaware, U.S. The acquisition helped Myonex to better supply patients in clinical trials with medication and equipment as needed. It will also help the company expand its clinical trial designs and include direct-to-patient and home healthcare provider capabilities.

Key Takeaways of Analyst:

The U.S. compounding pharmacies market remains lucrative with plenty of opportunities for growth over the next five years. Compounding is growing in popularity as patients seek alternatives to manufactured drugs for various conditions. The ability of compounding pharmacies to customize medications to individual needs will continue driving demand. Compounding also allows for the production of drugs that are no longer produced commercially or in shortage. This advantage will keep compounding relevant.

However, market growth could be restrained by regulatory pressures facing compounders. Stricter production standards and oversight after recent scandals may dissuade some pharmacies, potentially limiting supply. Competitive pressures from chain pharmacies also entering customized medication space may challenge independent compounders. Additionally, the market remains geographically fragmented with no clear leader. Further consolidation needs to occur for efficiency gains.

Despite restraints, opportunities abound. An aging population and growing prevalence of complex conditions requiring specialized therapies bode well. Targeted marketing and patient education can boost the awareness of compounding benefits. Partnerships with insurers incentivizing compounding access and coverage would open the market considerably. The expansion of compounding services, such as dermatology and veterinary medications, holds promise.

Market Challenges – Increasing Product Warnings in Sterile Compounding

The major factors that hinder the growth of the U.S. compounding pharmacies market include increasing product warnings in sterile compounding. This has led to a decrease in the sales of compounded injectable drugs, which is also expected to hinder the market growth. For instance, the U.S. Food Drug Administration expanded an original warning on using Becton-Dickinson (BD) general use syringes of sizes 1mL, 3mL, 5mL, 10mL, 20mL, and 30mL. The agency noted that interaction with the rubber stopper in some lots of these syringes may adversely impact drug potency if filled in syringes and not used immediately.

Market Opportunities – Growing Adoption of Compounded Biologics

The growing adoption of compounded biologics presents a significant opportunity for the U.S. compounding pharmacies market. As biologic drugs become more prevalent in treating complex medical conditions like cancer and chronic diseases, the demand for customized medication alternatives is growing. Compounding pharmacies allow for specialized biologics to be created to better suit individual patient needs. This is important as not all U.S. Food and Drug Administration approved drugs work uniformly across different genetic profiles and clinical factors in each person. As biologics continue to revolutionize the treatment of serious diseases, compounded versions provide an important avenue for optimizing patient care through personalization. This emerging opportunity is well-positioned to support significant expansion of the U.S. compounding pharmacies market in the coming years as the chronic illness burden escalates across communities. Catering to this specialized niche with alternatives for hard-to-treat populations can prove integral to the long term growth trajectory of compounding pharmacies market.

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The therapeutic area segment includes hormone replacement therapy, pain management, specialty drugs, nutritional supplements, and others. The hormone replacement therapy sub-segment is expected to hold 32.4% of the market share in 2024 owing to the high incidence of hormonal imbalances among the U.S. population. As people age, it is common for hormone levels in the body to fluctuate or decline. This can cause a wide variety of uncomfortable and unpleasant symptoms. Issues like hot flashes, night sweats, mood swings, decreased libido, vaginal dryness in women, and other signs of hormonal decline are quite common in middle aged and older individuals. The stress of modern lifestyles also takes a toll on hormone balance in many individuals. This growing need to mitigate symptoms of hormonal imbalance and maintain quality of life has driven the demand for compounded hormone replacement therapy medications. Customized drug formulations prepared by compounding pharmacists help men and women effectively manage their hormone levels and feel their best.

Insights, By Route of Administration: Pain Management Drives Need for Customized Treatments

The route of administration segment includes oral, parenteral, and others. The oral sub-segment is expected to hold 28.1% of the market share in 2024 due to the popularity and convenience of oral medications for pain management. Pain affects a significant proportion of the U.S. population at some point. From minor headaches to severe chronic conditions like arthritis or back pain, effective pain relief is highly sought after. While conventional oral painkillers are sufficient for some, many individuals require customized medications to truly get their pain under control. Compounded drugs allow for tailoring of drug types, strengths, and formulations according to an individual's unique needs, biochemistry, and tolerance levels. This has significantly boosted the demand for compounded oral medications for effective pain management.

Insights, Application: Individualized Care Boosts Custom Compounding for Humans

The application segment includes humans and veterinary. The humans sub-segment is expected to hold 56.2% of the market share in 2024 due to the growing demand for individualized healthcare. Modern medical practice places great emphasis on personalized care and treatment according to an individual's specific conditions, genetics, and others. However, not all conventional medications are suitable or optimally effective for all patients. Compounded medications offer a solution, allowing the formulation of customized drugs site-specific therapies based on human physiology. They also help address issues like allergies to inactive ingredients or the need of specific dosage forms not commercially available. This expanding need for individualized clinical care has fueled growth in the demand for human-oriented compounded medications and has driven major market share for the human segment.

Market Report Scope

Key Developments

• In November 2023, Precision Compounding Pharmacy, a technology-enabled compounding pharmacy that fulfills telemedicine prescriptions, announced that it had received a seed investment from Right Side Capital Management, a technology startup investment firm. The funds will allow Precision Compounding Pharmacy to enhance its suite of services, broaden its reach, and drive innovation in the pharmacy industry.
• In April 2021, National Association of Boards of Pharmacy (NABP), and the U.S. Food and Drug Administration collaborated together to improve the oversight of compounding pharmacies through the implementation of the Memorandum of Understanding Addressing Certain Distributions of Compounded Human Drug Products (MOU)

*Definition: A compounding pharmacy is a specialty pharmacy that creates custom medications tailored to meet the unique needs of individual patients. These pharmacies prepare medications from raw ingredients, often when commercially available drugs do not meet a patient's specific requirements, such as in cases of allergies, sensitivities, or the need for a specific dosage or flavor. A patient who cannot be treated with U.S. Food and Drug Administration (FDA)-approved drug, such as one who has a dye allergy and needs a medication to be made without it, or a patient who is elderly or a child who is unable to swallow a tablet or capsule and needs a medication in a liquid dosage form, may require a drug to be compounded. When a U.S. Food and Drug Administration approved drug is not medically necessary to treat a patient, doctors at hospitals, clinics, and other healthcare facilities occasionally provide them compounded medications.

Market Segmentation

• Therapeutic Area Insights (Revenue, USD Mn, 2019 - 2031)
• • Hormone Replacement Therapy
  • Pain Management
  • Specialty Drugs
  • Nutritional Supplements
  • Others
•  Route of Administration Insights (Revenue, USD Mn, 2019 - 2031)
• • Oral
  • Parenteral
  • Others
•  Application Insights (Revenue, USD Mn, 2019 - 2031)
• • Humans
  • Veterinary
• Key Players Insights
• • Avella Specialty Pharmacy,Ltd
  • Rx3 Compounding Pharmacy
  • B Braun SE
  • QuVa Pharma
  • ITC Compounding Pharmacy
  • PharMEDium Services
  • Cantrell Drug Company
  • Triangle Compounding Pharmacies,Hoye’s Pharmacy
  • Vertisis Custom Pharmacy
  • Smith Caldwell Drug Store
  • Nephron Pharmaceuticals Corporation
  • Clinigen Group PLC
  • Lorraine’s Pharmacy
  • Precision Compounding Pharmacy