The greatest advantage of contract services is reducing capital spending by brand manufacturers to increase their own capacity to meet demand. Nearly half of all pharmaceutical and device companies currently contract services. PMMI, the Association for Packaging and Processing Technologies, released a new report that takes closer look at trends in contract services including packagers (CPO), manufacturers (CMO), developers (CDMO), and researchers (CRO).
There are several reasons contract manufacturing is on the rise including increased market demand, rising R&D costs, and expiring patents. Though there are hundreds of contract manufacturers, only 30 companies account for more than half of the industry’s revenues. Half of the pharmaceutical companies currently using domestic contract services also use offshore services; the same is true of 33% of medical device companies.