India is on track to potentially account for 8-10% of the global market share in Contract Research, Development, and Manufacturing Organizations (CDMOs) by 2033, according to a new report from McKinsey & Company. This shift is driven by a significant movement of outsourcing work from the European Union and the United States to various Asian countries, with India and Korea emerging as key players in the industry.

Market Growth Driven by Geopolitical Shifts

The global CDMO industry, currently valued at approximately USD 224 billion, is projected to grow to USD 465 billion by 2032. The report highlights that evolving geopolitical dynamics are reshaping the landscape, prompting many Indian CDMOs to anticipate that 20-40% of their new business will arise from these changes.

Anirudh Roy Popli, a Partner at McKinsey & Company, emphasized the growing recognition of Indian CDMOs within the biopharma sector. “With a strong focus on value and innovation, Indian CDMOs are well-positioned to play a pivotal role in shaping the future of healthcare,” he noted in an interview with Medgate Today.

Opportunities and Challenges Ahead

Prem Pavoor, Senior Partner and Head of India & India Healthcare Investments at Eight Roads Ventures, pointed out that the changing geopolitical environment and upcoming legislation present a transformative opportunity for the Indian CDMO industry. He observed an increasing number of request-for-proposals from leading Indian biopharmaceutical companies, particularly from U.S. clients. Although these customers may currently adopt a cautious approach, the trend indicates a strong desire to diversify their outsourcing strategies amid global uncertainties.

As India positions itself as a new powerhouse in the global CDMO market, the combination of geopolitical shifts and a rising demand for biopharmaceutical services presents a unique opportunity for growth. However, this potential also brings challenges. Pavoor emphasized the need for Indian CDMOs to enhance their infrastructure and services to meet rising demand. “While this creates a huge opportunity for India, CDMOs must be prepared to capitalize on it effectively,” he added.

With strategic investments and a focus on innovation, Indian CDMOs are set to play a crucial role in the evolving landscape of biopharma outsourcing, making it essential for them to be ready to embrace this transformative period.