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Drug Discovery Outsourcing Market To Surpass US$ 6,262.4 Mn By 2030

Drug Discovery Outsourcing Market To Surpass US$ 6,262.4 Mn By 2030 - Coherent Market Insights

Publish In: Jun 15, 2023

Drug discovery outsourcing is a practice used by pharmaceutical and biotechnology companies to reduce the costs of drug development. The use of outsourcing facilities to compound ready-to-use drugs is gaining traction in hospitals and other health care systems. Outsourcing pharmaceutical drug commercialization enables smaller drug companies to forego significant investment needed for a corporate infrastructure, investment in a sales force, distribution or third party logistics, and other requirements. Drug discovery outsourcing to third party organization often make a notable difference in the level of success of a given drug product.  

Market Statistics:

The global drug discovery outsourcing market is estimated to account for US$ 3,825.2 Mn in terms of value by the end of 2023.


Increasing demand for safe and effective drugs across the globe is expected to drive growth of the global drug discovery outsourcing market over the forecast period. Market players are engaged in research and development (R&D) for the development of safe/effective drugs to meet the growing demand. In March 2023, Iktos announced the closing of a € 15.5 million Series A round to expand its artificial intelligence (AI) based drug discovery technologies and solutions. This will enable the Iktos to further develop its AI and drug discovery capabilities and expand its existing offering, in addition to launching Iktos Robotics; an end-to-end, drug discovery platform which combines AI and automation of chemical synthesis to significantly accelerate drug discovery timelines.


Increasing demand for outsourcing services across the globe is expected to offer significant growth opportunities for players in the drug discovery outsourcing market. In April 2023, Taros Chemicals (a leading small molecule contract research organization) and Welab Barcelona (a drug discovery and development centre) announced a strategic partnership to provide clients with integrated drug discovery and development services spanning from hit generation to the pre-clinical development. Under the agreement, both pharma and biotech companies will get access to Taros’ synthetic and medicinal chemistry expertise that covers "hit identification, hit to lead, and lead optimization" as well as drug design and molecular modelling services.


High cost of drug development and stringent rule & regulations for drug manufacturing are major factors expected to hamper growth of the drug discovery outsourcing market. Drug development is an expensive, time consuming, and a long-term process. Higher costs associated with preclinical studies for drug discovery is the biggest challenge. Many drugs fail in early stage as well as in late stage clinical trials. Pharma and biotech companies spend huge on research & development (R&D) to identify the target and then bind that target to compounds of interests.

Moreover, drugs compounded by outsourcing facilities are subject to Current Good Manufacturing Practice (CGMP) requirements. Drugs compounded by a facility can qualify for exemptions from the U.S. Food and Drug Administration (FDA) approval requirements and the requirement to label products with adequate directions for use, but not from CGMP requirements.

Global Drug Discovery Outsourcing Market- Impact of Coronavirus (Covid-19) Pandemic

Drug discovery outsourcing has become a vital aspect of developing effective treatments against viruses, and the outbreak of COVID-19 has increased the demand for drug discovery outsourcing services to developing or manufacturing safe and effective drugs or vaccines to fight COVID-19. Moreover, with the increasing cases of COVID-19 across the globe, the demand for safe/effective vaccine is also increasing rapidly. In June 2021, Catalent, Inc. and Moderna, Inc. collaborated up to manufacture Moderna’s COVID-19 vaccine and potentially other investigational programs in Moderna’s pipeline at Catalent’s facility in Indiana. This trend is expected to continue during the forecast period, driving the growth of the market.

To know the latest trends and insights prevalent in this market, click the link below:

Key Takeaways:

The global drug discovery outsourcing market was valued at US$ 3,545.9 Mn in 2022 and is forecast to reach a value of US$ 6,262.4 Mn by 2030 at a CAGR of 6.4% between 2023 and 2030.

Lead Identification & Candidate Optimization segment held dominant position in the global drug discovery outsourcing market in 2022, accounting for 32.3% share in terms of value, increasing approval and launch of new products is expected to propel growth of the segment during the forecast period.

Market Trends:

Increase in research and development is one of the key trends expected to boost the growth of the drug discovery outsourcing market. Players in the market are engaged in research and development (R&D) activities for the development of safe/effective drugs to treat chronic, genetic, respiratory, and other diseases and reduce global disease burden. For instance, in November 2022, Sanofi and Insilico Medicine signed a US$ 1200 million Drug Development Deal. The agreement will allow Sanofi to use Insilico’s AI platform to advance the drug development in up to six new targets. This trend is expected to continue during the forecast period.

Competitive Landscape:

Major players operating in the global drug discovery outsourcing market include Curia, Genscript, Evotec, Eurofins Scientific, Laboratory Corporation of America Holdings, among others.

Recent Developments:

In October 2022, Amphista Therapeutics, a biotech company focusing on drug discovery that use targeted protein degradation (TPD), collaborated with Domainex, a medicines research service partner, as a partner to provide integrated drug discovery services for its research programs.

In May 2023, Google Cloud launched two new AI-powered tools that will help pharma and biotech companies accelerate drug discovery. The suite is designed to help pharma and biotech companies predict and understand the structure of proteins, a vital part of drug development.

In November 2021, GenScript ProBio launched a Closed-End Double-Stranded DNA Service for CRISPR to assist in the development of new immunotherapies using cell and gene therapy.

In August 2021, Eurofins partnered with a pre-clinical antibody discovery service provider, Fusion Antibodies to support Eurofins in preclinical drug discovery research.

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