Drug Discovery Outsourcing Services Market Analysis

Drug Discovery Outsourcing Service Market Analysis

By service type, the drug discovery outsourcing services market is classified into chemistry services and biological services. The biological services segment is anticipated to show significant growth of 9.7% during the analysis timeframe. Biological services encompass a range of specialized offerings that involve the study and manipulation of biological systems, such as cells, tissues, and biomolecules, to facilitate the identification and development of potential therapeutic compounds. Biological services play a pivotal role in assessing the interactions between complex potential drug candidates and living organisms at the cellular and molecular level.
 

Biological services encompass cell-based assays, tissue culture, molecular biology techniques, biomarker analysis, pharmacogenomics, and toxicology studies. These services are vital for assessing the effects of drug candidates on biological systems, evaluating their safety, efficacy, and understanding their mechanisms of action, thereby fostering market expansion.
 

Based on drug type, the drug discovery outsourcing services market is segmented into small-molecule and large-molecule. The large-molecule drugs segment held a business share of 17.2% in 2022 and is anticipated to grow at a CAGR of 9.2% from 2023 – 2032. Large-molecule drug discovery services encompass a range of specialized expertise, including advanced biologics research, molecular engineering, and high-throughput screening. These drugs are complex therapeutic entities, including proteins, antibodies, and other biologics that offers highly targeted mechanisms of action for treating intricate diseases. Large molecule drugs are administered through injections or infusions and are often produced using advanced biotechnology processes. Furthermore, the rise of biopharmaceuticals and immunotherapies underscores the need for external capabilities in expression, purification, and characterization.
 

These drugs are used to treat numerous diseases, including cancer, autoimmune disorders, and infectious diseases. Outsourcing services for large-molecule development enables pharmaceutical and biotechnology companies to gain access to expertise and cutting-edge technologies and efficiently navigate the complexities of large-molecule drug development. Such factors are anticipated to boost market size.
 

Based on disease model, the drug discovery outsourcing services market is segmented into in vitro, animal, cellular, and other disease models. In vitro models accounted for significant revenue share of 42.5% of market, in 2022 and is expected to grow at 8% CAGR during the forecast timeframe. In vitro models provide a controlled and rapid platform for high-throughput screening of potential drug compounds, enabling the assessment of numerous candidates in a shorter time frame. These models simulate disease conditions in a controlled environment, enabling swift and cost-effective evaluation of potential drug candidates. In vitro models aid in the early stages of drug discovery, enabling efficient evaluation of toxicity of drug candidates, compound efficacy and safety profiles before progressing to more resource-intensive stages. This minimizes potential risks, reduces costs, and accelerates decision-making.
 

Based on cancer type, the drug discovery outsourcing services market is segmented into oncology, neurology, diabetes, infectious diseases, and other therapeutic areas. The oncology segment was valued to be USD 1,190.7 million in 2022 and is expected to grow at CAGR of 8.3% during the forecast timeframe. The rising burden of oncology has surged the demand for drug discovery outsourcing services to develop novel cancer therapeutics. Drug discovery outsourcing lead to the development of novel and innovative oncology treatments, addressing unmet medical needs and offering new avenues for cancer management. Drug discovery outsourcing services in oncology provide specialized expertise, resources, and technologies to identify and develop innovative drugs targeting cancer.
 

For instance, in 2023, Astex Pharmaceuticals collaborated with Merck & Co., Inc. to identify small molecule candidates with activity towards a tumour suppressor protein for the treatment of cancer. Similarly, in June 2020, AstraZeneca partnered with Accent Therapeutics to discover, develop, and commercialize novel cancer therapeutics targeting RNA-modifying proteins (RMPs). This collaborative effort will enable to rapidly advance and achieve the effective therapeutic potential for the treatment of cancer.
 

The North America drug discovery outsourcing services market dominated the overall industry with 50.3% market proportion in 2022 and is expected to show similar trend over the coming years. This high revenue share is mainly attributed to the region’s strong pharmaceutical industry and advanced research infrastructure, attracting global collaborations. Outsourcing offers cost-efficiency through access to skilled scientists, cutting-edge technologies, and specialized expertise, allowing companies to optimize resources. Moreover, the increasing complexity of drug discovery, from target identification to preclinical studies, necessitates diverse capabilities. By partnering with outsourcing providers, pharmaceutical companies tap into a wide range of services, accelerating timelines, fostering innovation, and staying competitive in the rapidly evolving landscape, thus fostering the growth of the North America market.