Drug Discovery Services Market Analysis

Global Drug Discovery Services Market Overview

The Drug Discovery Services Market Size was valued at USD 19.2 billion in 2022 and is projected to grow from USD 21.87 Billion in 2023 to USD 62.4 billion by 2032, exhibiting a compound annual growth rate (CAGR) of 14.1% during the forecast period (2023 - 2032). Growing Outsourcing of Drug Development and Increasing Research & Development Costs are the key market drivers enhancing the Drug Discovery Services market growth.

Source Secondary Research, Primary Research, MRFR Database and Analyst Review

Drug Discovery Services Market Trends

• Increasing R&D spending by pharmaceutical and biotechnology businesses will boost the market growth.

Pharmaceutical and biopharmaceutical businesses are choosing fully integrated or functional outsourcing services for drug research and development from the early development stage to the late-stage development phase due to increased R&D expenditures. While pharmaceutical businesses are under intense pressure to keep fixed costs under control, outsourcing has emerged as a tactical solution to the lack of internal resources needed for new product development. Large pharma firms are switching to a leaner corporate strategy that strongly emphasizes outsourcing. To increase profitability, adhere to the timescales required for drug development, and reduce expenses, the majority of pharmaceutical and biopharmaceutical businesses outsource their testing tasks throughout R&D. Recent collaborations between large pharmaceutical firms and CROs that offer drug discovery and development services are proof of this. Hence, rising pharmaceutical R&D spending contributes to the market for drug discovery services expanding. Thus, this factor is driving the market CAGR of Drug Discovery Services.

Increasing need for innovative therapeutics across a range of therapeutic goals. Drug-finding services Rising need for innovative treatments for chronic illnesses and advancements in the  healthcare industry are predicted to be the main drivers of market expansion. Pharmaceutical and biopharmaceutical businesses still contract their research and development (R&D) operations to CROs, who offer R&D services and create engagement models to maximize R&D efficiency. Governments and pharmaceutical corporations are forced to look for answers and boost their investment in clinical trials due to the increased burden of chronic diseases. As a result, there will be a greater need for drug discovery services.

Chronic illnesses with substantial socioeconomic costs and a growing patient illness burden include diabetes, dementia, and cardiovascular disease. They are responsible for more than 40 million deaths annually, or seven out of every ten fatalities ly. Most healthcare expenses are related to chronic illnesses, the main killers and sources of disability in the U.S. The prevalence of chronic illnesses is anticipated to drive the  market for drug discovery services throughout the forecast period, leading to a rise in R&D investment and research efforts for generating innovative pharmaceuticals. Due to the rising incidence of these chronic conditions, there is a strong need for drugs, which opens up the new business potential for market of Drug Discovery Services. Thus, this aspect is anticipated to accelerate Drug Discovery Services' market revenue globally.

Drug Discovery Services Market Segment Insights

Drug Discovery Services Drug Type Insights

Based on Drug Type, the market segments of Drug Discovery Services includes Small Molecule Drugs, Biologics. The anterior Drug Discovery Services segment held the majority share in 2022, contributing around ~65-67% concerning the  Drug Discovery Services market revenue. The market is divided into small and big molecules based on the different types of drugs. Small molecules are crucial in the creation of novel medicines for patients all over the world. Small molecule applications account for sales of fifty percent of specialty medications. Also, it may be seen in the current approval patterns. The FDA authorized 48 new medications in 2019, 79% of which were made up of small molecules. Oncology, cardiovascular, autoimmune, and respiratory disorders are four important therapeutic areas where small molecules continue to play a critical role in developing new medicines.

Figure 1 Drug Discovery Services Market by Drug type, 2022 & 2030 (USD billion)

Source Secondary Research, Primary Research, MRFR Database and Analyst Review

Drug Discovery Services Type Insights

Based on type, the Drug Discovery Services market segmentation includes Drug metabolism and pharmacokinetics (DMPK) Services, Pharmaceutical Services, and Others. The DMPK segment dominated the market in 2022 and is projected to be the faster-growing segment during the forecast period, 2022-2030. This is due to the increasing preference for metal implants due to their high corrosion resistance. The effectiveness and safety aspects of the drug research and development process are significantly influenced by Drug Metabolism and Pharmacokinetics (DMPK) Services. Early identification of metabolic pathways, possible interactions, and clearance routes for their substances is beneficial. Drug Metabolism and Pharmacokinetics (DMPK) services market expansion is attributed to new technological advancements made by several firms to offer pharmaceutical companies improved services. Hence, rising innovations and advancements positively impact market growth.

Drug Discovery Services Therapeutic Area Insights

Therapeutic Areas have bifurcated the  Drug Discovery Services market data into Oncology, Others. The Oncology segment dominated the market in 2022 and is projected to be the faster-growing segment during the forecast period, 2022-2030. Cancer cases are rising ly, prompting pharmaceutical companies to create cutting-edge treatments for malignancies. Lung and breast cancer, with more than 2.21 million and 2.26 million cases, respectively, are the most common kinds of cancer, according to the World Health Organization (WHO). Also, the increased incidence of cancers, including the colon, prostate, and liver, has sped up R&D efforts to create effective treatments.

Drug Discovery Services Regional Insights

By Region, the study provides market insights into North America, Europe, Asia-Pacific and the Rest of the World. The North American Drug Discovery Services market, accounted for USD 8.79 billion in 2022 and is expected to exhibit a significant CAGR growth during the study period. Higher investments in drug discovery R&D, significant firms with established research infrastructure, and technical improvements can all be linked to the regional market's growth. As outsourcing is no longer only about cutting costs, a growing need for effectiveness, quality, and innovation is anticipated to support industry expansion. Biologics are more expensive, so there is a large market for biosimilars in the United States. By 2023, it is anticipated that the U.S. market for drug development services will be one of the main competitors for biosimilars.

Further, the major countries studied in the market report are The U.S, Canada, Germany, France, UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure 2 DRUG DISCOVERY SERVICES MARKET SHARE BY REGION 2022 (%)

Source Secondary Research, Primary Research, MRFR Database and Analyst Review

The Asia Pacific drug discovery services market is predicted to grow at the greatest rate throughout the prediction period. Because of the availability of qualified people, cheaper prices, an effective regulatory environment, and high-quality data, the Region is quickly becoming a hub for outsourcing drug development activities. The second-largest pharmaceutical market in the world, Japan, is anticipated to provide CROs with a sizable potential, driving the industry. The updated Pharmaceutical Affairs Law in Japan encourages cancer and tissue diagnostics research, which is anticipated to accelerate market expansion in this area. Moreover, the China market of Drug Discovery Services held the largest market share, and the India market of Drug Discovery Services was the fastest-growing market in the Asia-Pacific region.

The quick development of technology and the growth of metropolitan areas propels the European drug discovery services market. In addition, the European Medicines Agency (EMA) suggested that 39 new active medications and 97 new medicines be approved in 2020. The development of biologics and biosimilars has seen an increase in investment from biopharmaceutical firms, which is responsible for the rise in the number of authorized drugs in Europe. The European market of Drug Discovery Services is anticipated to be driven by increasing expenditures made by many major companies in various clinical and non-clinical research activities that are outsourced to several CRO service providers and help with efficient product development. Further, the Germany market of Drug Discovery Services held the largest market share, and the U.K. market of Drug Discovery Services was the fastest-growing market in the European Region.

Drug Discovery Services Key Market Players & Competitive Insights

Leading market players are investing a lot of money in R&D to expand their product portfolios, which will spur further market growth for Drug Discovery Services. With significant industry changes, including new product releases, contractual agreements, mergers and acquisitions, increased investments, and collaboration with other organizations, market developments are also undertaking various strategic activities to expand their presence. To grow and remain in a market that is becoming increasingly competitive, Drug Discovery Services industry competitors must provide affordable products.

Manufacturing locally to cut operational costs is one of the main business tactics the Drug Discovery Services industry uses to serve customers and increase the market sector. The Drug Discovery Services industry has recently given medicine some of the most important advantages. The Drug Discovery Services market major player such as Advinus Therapeutics, Abbott Laboratories Inc., Albany Molecular Research Inc. (AMRI), Agilent Technologies Ubiquigent, Aurigene, AstraZeneca PLC, Charles River Laboratories International, and others are working on expanding the market demand by investing in research and development activities.

Charles River Laboratories International, Inc. specializes in a range of preclinical and clinical laboratory, gene therapy, and cell therapy services for the pharmaceutical, medical device, and biotechnology sectors. Charles River Labs purchased the bioanalytical services company Retrogenix (U.K.) in March 2021. With this purchase, Charles River's Scientific capabilities in off-target profiling for drug development and cell microarray technologies are strengthened.

The pharmaceutical, culinary, environmental, agriscience, and consumer products sectors and governments get testing and support services from the French laboratory organization Eurofins Scientific S.E., headquartered in Luxembourg. To expand their integrated drug discovery platform, DiscoveryOne, Eurofins, and Liverpool ChiroChem Ltd cooperated in September 2021 to provide additional chemical knowledge using LCC's fragment library and PROTAC linker molecules.

Key Companies in the market of Drug Discovery Services include

• Advinus Therapeutics


• Abbott Laboratories Inc.


• Albany Molecular Research Inc. (AMRI)


• Agilent Technologies Ubiquigent


• Aurigene


• AstraZeneca PLC


• Charles River Laboratories International

Drug Discovery Services Industry Developments

November 2023 Evotec and Bayer enter into a new strategic collaboration to accelerate the discovery and development of new drugs for multiple therapeutic areas. Under the terms of the agreement, Evotec will provide Bayer with access to its integrated drug discovery platform, which includes its expertise in target identification and validation, hit-to-lead and lead optimization, and preclinical development.Thermo Fisher Scientific announces the launch of its new Ion PGM™ Dx Sequencing System, which is a next-generation sequencing (NGS) system that is designed to help pharmaceutical and biotechnology companies accelerate drug discovery and development. The Ion PGM Dx Sequencing System is designed to provide accurate and reliable results for a wide range of NGS applications, including target identification, validation, and drug screening.Qiagen announces the launch of its new QIAseq Targeted DNA Panels, which are a family of NGS panels that are designed to help pharmaceutical and biotechnology companies target specific genes or regions of the genome for sequencing. The QIAseq Targeted DNA Panels are designed to provide high-quality and reliable data for a wide range of drug discovery applications.

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