Drug Manufacturing is Around 50% Cheaper in India than in Western Countries, Claims GBI Research

19 Nov 2012 • by Natalie Aster

Global contract manufacturing organizations (CMOs) are set to steadily become more and more popular, as Western pharmaceutical companies outsource production to Asian countries in a bid to cut costs.

The report, "Downstream Processing in Biopharmaceuticals - Adoption of Disposable Technology at Improved Economies of Scale to Optimize Production Efficiency and Cost-effectiveness" by GBI Research, cites that the overall cost of drug manufacturing is up to 50% cheaper in India than in Western countries, which is pushing Big-Pharma abroad.

Report Details:

Downstream Processing in Biopharmaceuticals - Adoption of Disposable Technology at Improved Economies of Scale to Optimize Production Efficiency and Cost-effectiveness
Published: November, 2012
Pages: 59
Price: US$ 3.500,00

Major CMOs offer upstream and downstream manufacturing functions equally; and, in addition to manufacturing in biopharmaceutical production, they also offer clinical trials, logistics, packaging, and even marketing. According to the industry experts, manufacturing functions dominate almost 60% of the CMO market, with downstream processes accounting for 50% of the manufacturing process.

GBI Research also suggests that the CMO market size for downstream processing is set to grow at a CAGR of 15.1%, which is higher than the growth of the overall CMO biopharmaceutical market, due to the approval of biosimilars in the downstream industry, which is expected to drastically increasing future demand for equipment and reagents.

In spite of high drug prices, biopharmaceutical firms are not currently able to satisfy the high market demand, and once these prices come down, demand will grow at a much faster rate. The increased use of disposables in biopharmaceutical manufacturing is also boosting the downstream market, as reductions in capital and cleaning costs for pharmaceutical companies turn profits for CMOs.

CMOs are working to integrate service portfolios in order to offer complete solutions to pharmaceutical manufacturers. While the concept of providing total biopharmaceutical solutions has historically been present only within the US and certain European countries, nations such as India, Korea and China have started to adopt the same business model over the past few years, and have attracted big business as a result, thanks to vast differences in production and labor costs in developed and developing countries. These forged relationships allow both CMOs and pharmaceutical manufacturers to pursue large-scale business opportunities using each other’s facilities.

More information can be found in the report “Downstream Processing in Biopharmaceuticals - Adoption of Disposable Technology at Improved Economies of Scale to Optimize Production Efficiency and Cost-effectiveness” by GBI Research.

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