The European CMO sector is set to double in the next six years and will hit revenues of up to $20.75bn, according to Frost & Sullivan’s Aiswariya Chidambaram.
In a report titled ‘European Pharmaceutical and Biotech Contract Manufacturing Markets’ the healthcare market analyst said biosimilars is a key driving factor behind the expected growth.
Speaking to Outsourcing-Pharma, she said: “When biotech drugs come out of patent they cannot be easily re-produced like how pharmaceutical drugs can be, because it is difficult to establish the reproducibility when it comes to biotech drugs due to the complex manufacturing process, the investment and technology resources required.
“What a company tends to do is once a drug comes out of patent, even generic drugs, they leverage the support of CMOs (contract manufacturing organisations) who have all this in place.”
She added that with the expected growth, many European CMOs are on the verge of expansion. However Chidambaram warned that those looking to grow should make “cautious decisions”.
“It’s tricky,” she said. “It’s where anticipating capacity demand comes into play. There are a lot of factors that could affect demand for certain markets, for instance the product requirements the approvals rates by regulatory bodies or the new technologies.
“It Is essential companies take this into account before investing so that they are not hit by over-capacity in the long run.”