India's CRDMO Sector Poised for Global Leadership by 2035

India's CRDMO sector is set to reach USD 22-25 billion by 2035, driven by cost advantages and rapid project startups, according to a BCG and IPSO report. India is emerging as a preferred outsourcing destination, with potential to become a global leader with strategic growth and overcoming key challenges.

India's Contract Research, Development, and Manufacturing Organization (CRDMO) sector is on a trajectory to achieve USD 22 billion to USD 25 billion by 2035, as outlined in a report by Boston Consulting Group (BCG) and Innovative Pharmaceutical Services Organization (IPSO). The sector is advancing at a 15 percent CAGR, surpassing global industry growth. This is largely driven by India's cost advantage over Western competitors and its significantly faster project startup times.

The report highlights that Western pharmaceutical companies are exploring alternative hubs, while global supply chain realignments present a USD 10 billion opportunity for India's CRDMOs. Emerging modalities such as DNA and RNA therapies, along with antibody drug conjugates (ADCs), are expanding annually by 25-35 percent, positioning India to lead innovation worldwide.

Government investment of over Rs 25,000 crore is bolstering India's biotech and pharmaceutical innovation, creating a self-sufficient ecosystem. Though India currently holds a 2 to 3 percent share of the USD 140-145 billion global CRDMO market, it has the potential to become a dominant global force.

India's appeal as an outsourcing destination is magnified by supply chain de-risking efforts and continued offshoring encouraged by pricing pressures and legislative measures like the Inflation Reduction Act (IRA). There's a rising demand for advanced CRDMO services, driven by the pursuit of sophisticated modalities like gene therapy and RNA therapeutics.

Strengthening India's innovation ecosystem with ongoing investments in R&D and infrastructure is imperative, the report notes. However, the sector faces five major challenges to maintain growth, including the need for a 6-7x talent expansion, expedited regulatory approvals, and a robust tier 1 supplier base to cut import dependency. Furthermore, limited funding and high capital costs pose barriers to necessary 4-5x investment, while ESG compliance needs improvement to match Western standards.

Peter Bains, CEO Designate of Syngene International Ltd, remarked on the pivotal transformation potential of the Indian CRDMO sector, emphasizing the need for collective efforts among stakeholders to seize global leadership in biopharma and life sciences outsourcing markets. Smruthi Suryaprakash, a Partner at BCG, underscored the urgency of addressing regulatory challenges and fostering R&D collaborations, alongside scaling talent to establish India as a global life sciences hub.