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Pharma co-manufacturing and co-packing projected to grow
 The market for contract services in the pharmaceutical sector has slumped since the end of 2008. However, it looks set to bounce back over the next five years, but the pace of growth might be faster for product manufacturing than for product-packaging services.
A new report from BCC Research predicts the global market for contract pharmaceutical services will reach $177 billion in 2009 and should increase 11.1% a year over each of the next five years, reaching $299 billion by 2014.
"With the increasing demand to reduce capital expenditures and protect their margins, pharmaceutical companies are outsourcing their noncore activities, such as active pharmaceutical ingredients, and intermediates manufacturing, to low-cost destinations like India and China," the report says.
However, the smallest segment of the pharma market, contract packaging, is projected to record the slowest growth. Compounded annual growth is forecast at 8%, with the market increasing in size from $5.5 billion in 2009 to $8.1 billion in 2014.
Most of the overall contract services market is taken up by contract manufacturing of OTC medicines and nutraceuticals such as dietary supplements. Those products accounted for $103 billion of the total market in 2009 and are forecast to grow at a rate of 11.4% annually to reach $177 billion in 2014.
Contract manufacturing of bulk- and dosage-form drugs, the second-largest segment, was estimated at $44 billion for 2009. That sector is projected to increase at a compound annual growth rate of 10.8% to reach $73.1 billion during the next five years.
Contract manufacturers have been experiencing a lot of recent volatility in the market as their customers adjust manufacturing capacity in the wake of the recent spate of consolidation. However, these factors also could present opportunities in the future, the report says.
Outlook Group lands long-term medical packaging contract
Outlook Group Corp., Neenah, WI, has signed a five-year agreement with TekPackaging LLC, Huntley, IL, to provide complete metal packaging services for TekPackaging's Thermoscan ear-thermometer probe-cover business. Thermoscan is the market leader and healthcare industry standard for electronic thermometers.
Outlook Group, which offers contract packaging among its range of services, will produce and print folding cartons and complete the final packaging process on more than 600 million units per year. Outlook Group says it expects to begin shipping finished product in the spring of 2010.
"We are excited to be partnering with Outlook Group on this project, which will be Tek's largest supply contract," says Randy Loga, TekPackaging president and CEO. |
