Wafer-thin margins have forced a host of pharmaceutical companies in the U.S. to shutter their manufacturing facilities in the past couple of years. Hence, pharma companies these days are increasingly looking to outsource manufacturing to low-cost destinations such as India, China, and countries in Latin America. Such a strategic move not only saves them money, but also accords them more time to better focus on core competencies and research and development. This trend of outsourcing manufacturing to third parties has helped markets in emerging economies as well.
The opportunity in Latin America in pharmaceutical products, for example, was worth US$127.9 bn in 2015. Expanding at an impressive CAGR of 9.3%, it is expected to be worth US$286.2 bn in 2024.
There are numerous large and small players operating in the Latin America pharmaceutical products and CMO market. This makes the market highly fragmented. The top five companies, namely Pfizer, BASF SE, Novartis AG, Bayer AG, Inc., and Merck & Co., Inc., together held around 23.0% of the market in 2015.
Patent Expiration and Quick Drug Approvals Fillip Market
The CMO market in Latin America has received a major fillip on account of the imminent patent expiration of many blockbuster drugs. As per an industry expert, innovation in the pharmaceutical industry has been negatively impacted due to cuts on research and development budgets by federal banks. This, coupled with patent expirations, have egged large companies to seek synergies with CMOs through mergers and acquisitions.
Open economies in the region pose few barriers to the entry of new and international players into the market. As a result, many multinational pharmaceutical companies have invested heavily in the region. Another major push to the Latin America market has been provided by quick drug approvals. The three major types of products in the market for pharmaceutical products and CMO in the region are API and ingredients, finished dosage form (FDF), and pharmaceutical packaging. Among them, the FDF segment held a lion’s share in the market at around 86.0% in 2015. Going forward, the API and ingredients segment is forecast to expand at a good clip.
Brazil Dominates Latin America Market
The pharmaceutical products and CMO market in Latin America can be divided into regions comprising countries such as Peru, Argentina, Colombia, Brazil, Venezuela, Mexico, and Rest of Latin America. Among them, Brazil leads both the pharmaceutical products as well as CMO market vis-à-vis value. Due to a growing focus on research, this market is predicted to attain a value of US$67.3 bn by 2024. Argentina, on the other hand, is anticipated to emerge as one of the most attractive markets by 2024, by expanding at a healthy CAGR of 11.6% from 2016 to 2024.
Browse the full Latin America pharmaceutical products and CMO market report http://www.mrrse.com/latin-america-pharmaceutical-products-cmo-market
Peru, Brazil, Mexico, and Colombia are currently bettering their regulatory frameworks to further streamlined processes. This would likely have a positive impact on respective markets.