In the field of pharmacy, compounding is preparation of a custom formulation of a medication to fit a unique need of a patient such as medicine dose, which cannot be met with commercially available pharmaceutical products. In the U.S., conventional compounding pharmacies operate without the supervision of the U.S. Food and Drug Administration (FDA). The State Boards of Pharmacy regulate the conventional compounding, also known as ‘within border’ compounding. The U.S. Pharmacopeia (USP) has set the standard pharmacy compounding practices in most of the U.S. states. Compounding pharmacies operate in five formats, which include independent store, compounding department in hospital, part of a big retail drug manufacturer chain, store with an online order-delivery system, and multiple-location shops. In the U.S., compounding pharmacies are majorly found in independent store format.
The U.S. injectable compounding pharmacy market is estimated to be valued at US$ 1,317.9 million in 2021 and is expected to exhibit a CAGR of 7.3% over the forecast period (2021-2028).
Figure 1. U.S. Injectable Compounding Pharmacy Market Value (US$ Mn), by Packaging Type, 2021
The increasing drug shortage in the U.S. is expected to drive the market growth over the forecast period.
Due to COVID-19 pandemic, hospitals are facing shortage of drugs such as pain management drugs. Thus, the increasing prevalence of chronic diseases such as diabetes, cancer and others is expected to increase the demand for medicines for the treatment, which is expected to boost the U.S. injectable compounding pharmacy market growth over the forecast period.
For instance, according to a report of the U.S. Food and Drug Administration (FDA): Drug Shortages: Root Causes and Potential Solutions 2019, 56% of the hospitals reported they had changed patient care or delayed therapy in light of drug shortages and 36.6% said they had rescheduled non-urgent or emergent procedures. Such scenario leads to use of readily available compounded medications, which is expected to boost growth of the U.S. injectable compounding pharmacy market.
|Base Year:||2020||Market Size in 2021:||US$ 1,317.9 Mn|
|Historical Data for:||2017 to 2020||Forecast Period:||2022 to 2028|
|Forecast Period 2022 to 2028 CAGR:||7.3%||2028 Value Projection:||US$ 2,153.2 Mn|
Central Admixture Pharmacy Services, Inc., Nephron Pharmaceuticals Corporation, QuVa Pharma, Olympia Pharmacy, ASP Cares, Fagron Compounding Pharmacies, Athenex, Inc., Avella Specialty Pharmacy, Atlas Pharmaceuticals, Empower Pharmacy, Carie Boyd’S Prescription Shop, Edge Pharma, Imprimis NJOF, LLC, IntegraDose Compounding Services, LLC, Wells Pharma of Houston, LLC, US Compounding Inc., SCA Pharma, and Vertisis Custom Pharmacy.
|Restraints & Challenges:||
Moreover, according to the report titled as 'Drug Shortages: Root Causes and Potential Solutions' by the Drug Shortages Task Force of the U.S. Food and Drug Administration 2019, the cause of drug shortages are as follows:
Lack of Incentives to Produce Less Profitable Drugs: When there is very less or limited profitability in the drugs, the manufacturer tends to reduce its manufacturing operation of such drugs and also this factor decreases the drug manufacturer’s interest to enter the less profitable market, and to invest in manufacturing such drugs. Moreover, manufacturers offering older generic drugs face intense price competition, and the high investment requirements can limit their potential returns on investment and profit margin.
Logistical and Regulatory Challenges: The drug supply chain has become more complex, long, and fragmented as the drug manufacturing companies have their production overseas and also there is increase in the adoption of contract manufacturers. Moreover, the logistical and regulatory challenges, especially the complexity of the supply chain can limit the ability of drug manufacturers to increase their drug production, which is a major cause of drug shortage.
Figure 2. U.S. Injectable Compounding Pharmacy Market Share (%), by Pharmacy Type, 2028
The increasing geriatric population and improved longevity due to customized medicines are expected to drive the market growth over the forecast period.
In the U.S., the geriatric population is living longer due to the advancements in science & technology, medical practice, pharmaceuticals, and other interventions. These have resulted in reductions in the number of deaths from infectious diseases and others.
For instance, according to the Centers for Disease Control and Prevention (CDC), 2020, the following graph compares the age distribution of the population in the U.S., in the year 2020 and 2040. It can be concluded that the number of elderly population is expected to increase by 2040:
Moreover, compounding drugs are generally used to prepare drugs in the required combination, in the exact dosage form and that can be available in customized delivery systems, depending upon the requirement of the patient.
The increasing demand for pain management therapies among geriatric patients suffering from chronic diseases is expected to aid in the growth of the market over the forecast period.
For instance, according to the Progress in Neuro-Psychopharmacology and Biological Psychiatry Journal: 2019, chronic pain is highly prevalent among senior adults suffering from chronic conditions in the U.S.
U.S. Injectable Compounding Pharmacy Market – Impact of Coronavirus (COVID-19) Pandemic
The coronavirus (COVID 19) pandemic and lockdown in various countries across the globe have impacted negatively on the financial status of businesses in all sectors. Private healthcare sector is one of the sectors, which is majorly impacted by the COVID 19 pandemic.
Coronavirus pandemic has negatively impacted the development, production, and supply of medicines and also affected growth of the pharmaceutical businesses of various companies across the globe, as COVID-19 pandemic has led to lockdown in several countries across the globe. This lockdown has resulted in closure of industrial establishments, except manufacturing of essential commodities and disruption in supply chain of the pharmaceuticals and kits for diagnostic and therapeutic use.
Thus, COVID-19 pandemic has affected the economy in three main ways; 1) By directly affecting the production and demand; 2) By creating disruptions in distribution channels; and 3) By its financial impact on firms and financial markets.
Supply chain and manufacturing activities in India, China, and the U.S. are disrupted due to global lockdown, while many countries such as Saudi Arabia, UAE, Egypt, and others are facing problems with regards to transportation of drugs from one place to another.
U.S. Injectable Compounding Pharmacy Market – Restraint
Market players are recalling their products from the market, which is expected to hinder growth of the U.S. injectable compounding pharmacy market.
For instance, on April 28, 2020, QuVa Pharma Inc., a U.S. based compounding pharmacy recalled the entire batch of R.E.C.K. (Ropivacaine, Epinephrine, Clonidine, Ketorolac) 50 ml in Sodium Chloride-60 ml BD syringe that were prepared using sterile Ketorolac obtained from Fresenius Kabi. Moreover, on April 20, 2020, Fresenius Kabi also recalled multiple lots of Ketorolac due to the presence of particulate matter in the reserve sample vials.
Issues related to safety standards of compounded drugs is expected to hinder the market growth over the forecast period.
Major players operating in the U.S. injectable compounding pharmacy market include Central Admixture Pharmacy Services, Inc., Nephron Pharmaceuticals Corporation, QuVa Pharma, Olympia Pharmacy, ASP Cares, Fagron Compounding Pharmacies, Athenex, Inc., Avella Specialty Pharmacy, Atlas Pharmaceuticals, Empower Pharmacy, Carie Boyd’S Prescription Shop, Edge Pharma, Imprimis NJOF, LLC, IntegraDose Compounding Services, LLC, Wells Pharma of Houston, LLC, US Compounding Inc., SCA Pharma, and Vertisis Custom Pharmacy.
For instance, according to the Journal of American Pharmacist Association: August 17, 2020, 'Pharmacy compounding describes the act of combining, mixing, or altering of the ingredients of a drug to create a new medication according to the needs of an individual patient'. Compounding of a product is done due to a patient allergy to an ingredient in the commercially available products or the need for a different concentration, route of administration, or dosage form of compounded product. For instance, according to the U.S. Food and Drug Administration (U.S. FDA), 2020, due to COVID-19 pandemic hospitals are facing shortage of drugs such as pain management drugs. Thus, the increasing number of chronic diseases such as arthritis is expected to drive demand for pain management medicines, which is expected to boost the U.S. 503B compounding pharmacies market growth over the forecast period. For instance, according to the Centers for Disease Control and Prevention (CDC)’s May 2019 report, an estimated 54.4 million U.S. adults are diagnosed with arthritis, which accounted for around one in four people in the U.S.
The increasing drug shortages in the U.S., increasing geriatric population and improved longevity due to customized medicines, rising adoption of inorganic growth strategies by key players operating in the market and increasing novel product approvals and launches are the major factors that are expected to drive the growth of U.S. injectable compounding pharmacy market during the forecast period.
For instance, in May 2020, Central Admixture Pharmacy Services, Inc. launched three new compounded sterile preparations, which are in short supply for the ICU patients. The products are two vasodilators: Norepinephrine 8 mg added to 250 mL normal saline (NS), Vasopressin 50 units added to 50 mL NS, and a sedative: Midazolam 125 mg added to NS (1mg/mL).
Key features of the study:
“*” marked represents similar segmentation in other categories in the respective section.
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