DUBLIN–(BUSINESS WIRE)–The “Latin America Pharmaceutical Contract Manufacturing Organization Market – Growth, Trends, Forecasts (2022 – 2027)” report has been added to ResearchAndMarkets.com’s offering.
The Latin America pharmaceutical contract manufacturing organization market is expected to register a CAGR of 3.3% during the forecast period 2020 – 2025.
Being one of the North American Free Trade Agreement members, Mexico has access to the best established and emerging pharmaceutical markets in North and Latin America. In addition, the Indian pharmaceutical industry is increasing its footprint in Mexico with huge investments, thus driving the growth of the market.
Key Highlights
Brazil is the primary recipient of foreign direct investment in Latin America and it is emerging as a global manufacturing hub for pharmaceutical contract companies. Brazil held the second largest market share in the pharmaceutical contract manufacturing market in Latin America, having accounted for 24.9% in 2019.
Due to favorable factors, such as low manufacturing costs and numerous Good Manufacturing Practice (GMP)-certified plants, the pharmaceutical companies are interested in entering the Brazilian market, thereby widening the contract manufacturing industry’s scope in the country. Due to lower investments in R&D within the pharmaceutical industry, Brazil is expected to have significant scope for the contract service providers over the forecast period.
Pharmaceutical contract manufacturing has witnessed nominal growth in Argentina. The sales growth has slowed down due to economic deceleration. Despite the country’s current economic situation, the pharmaceutical contract manufacturing market witnessed an improved situation over the last few years.
Life expectancy in Chile has increased more than in most other OECD countries over the past few decades, although it is still almost two years below the OECD average. Furthermore, in relation to the pharmaceutical industry, activities in the country are being well conducted, which, in turn, are likely to impact the market for CMO. For instance, in September 2019, India and Chile formed an agreement to allow the drug manufacturing companies in India to participate in the tenders proposed by the Chile government. This will enable Chile to import cheaper drugs from India.
With the outbreak of COVID-19, there is a disruption in the supply chain. As the outbreak has become more widespread, it has become a burden for pharmaceutical plants worldwide to maintain the inventory required for manufacturing, thus creating challenges for the manufacturers.
Key Market Trends
Liquid Dose Formulation Holds Significant Market Share
The liquid/semi-solid dose formulation segment is mature, with a slower growth rate, as compared to the injectable formulation segment. The reduction in demand during the forecast period maybe attributed to storage, packaging, and transportation issues. These formulations provide lower returns, as compared to injectable drug formulations.
Owing to the continued usage of liquid dosage formulation in the nasal and ophthalmic sectors, the liquid dosage formulation segment is expected to record stable growth. This growth is backed up by increasing R&D in nasal delivery systems, for certain types of diseases and disorders, such as body pain, osteoporosis, and sexual diseases.
In addition, there is a visible declining trend in this segment, as the therapeutic markets for these formulations have a lower market share. However, interest in niche pharmaceuticals is expected to lead to low volume and high value products, which are intended to cater to the unique needs of patients.
Mexico Holds Significant Market Share
Mexico is the second-largest market for pharmaceutical contract manufacturing in Latin America. Contract manufacturing has opened a huge opportunity for the Mexican companies, and it is riddled with benefits.
The healthcare expenditure of the country accounts for 5.5% of the GDP, according to OECD. The health insurance coverage for vulnerable populations expanded over time, accounting for 89.3% among the OECD countries. This has triggered the pharmaceutical companies to eye the Mexican market. However, due to weak support from the government and lower per capita health spending among the Mexican population, there is a significant scope for outsourcing pharmaceutical manufacturing.
Continuous growth in the sales of generic drugs is driving the revenues of the local pharmaceutical contract manufacturers. In addition, significant growth in Mexico’s generics market is garnering investments from foreign manufacturers who are seeking access to other Latin American markets through Mexico-based production activities.
The Indian pharmaceutical companies are leading the way, in the development of generic drugs in Mexico, and they are investing heavily in the country. This represents the steady growth of pharmaceutical contract manufacturing in Mexico and indicates a promising ROI.
For more information about this report visit https://www.researchandmarkets.com/r/nq91xb
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