IVD Contract Manufacturing Market: Growth, Size, Share, and Trends

Market Growth Outlook Summary

The global IVD contract manufacturing market growth forecasted to transform from USD 15.4 billion in 2023 to USD 26.7 billion by 2028, driven by a CAGR of 11.5%. Growth in this market can primarily be attributed to the growing need for less costly and better equipments, increased need for IVD OEMs to establish themselves in the high potential market and emerge as a budding player in other allied markets, reduced risk of development failure, and reduction in cross contamination of IVD consumables at the CMO facility, and emergence of small scaled outsourcing facilities in emerging nations. However, the rising shortage of skilled labour, risk of patent infringement, and other Intellectual property safety failures, create a barrier to the growth of the market.

IVD Contract Manufacturing Market Opportunities

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IVD Contract Manufacturing Market Dynamics

Driver: Growth in the IVD devices market in developing countries

In the coming years, China and India are expected to drive growth in the Asia Pacific region. Over 100% GDP growth is anticipated in China and India between 2020 and 2040. Emerging economies may benefit from the growth. In order to take advantage of the numerous opportunities and set up businesses in the Asia Pacific region, foreign investment will also rise in this region. Additionally, the region will use IVD devices more frequently as a result of the rising number of diagnostic public-private partnerships and government grants, which will spur a rise in contract manufacturing.

Restraint: Protecting IP is a key challenge in contract manufacturing

Protecting IP is a key challenge in contract manufacturing, as OEMs need to ensure that their proprietary information and technology are not shared with competitors or third parties. When a brand outsources its production to a third-party manufacturer, it exposes itsintellectual property(IP) to the risk of theft or infringement. It is particularly true for products that rely heavily on patented or proprietary technology or processes. This creates a glitch in obtaining contracts from mid to large scale manufcturers.

Opportunity: Increasing healthcare expenditure, infrastructure, and awareness in developing countries

China, India, and other emerging economies offer significant growth opportunities for companies operating in the medical device contract manufacturing market. China and India have laxer regulatory standards than other developing nations. One of the main factors influencing the demand for IVD devices in emerging nations is the rising prevalence of various chronic and infectious diseases, together with the rising cost of healthcare. Another important driver is the rising desire for home healthcare. Due to this, numerous manufacturers have established operations in these nations.

Challenge: Lack of constant innovation to balance technological capabilities against costs and budgetary cuts observed by end users

For firms to compete in a complicated industry like IVD, ongoing innovation is essential. These developments aid contract manufacturers by accelerating the process, lowering the margin of error, and luring clients. In recent years, CMOs have developed a number of significant capabilities, including automated manufacturing, automated labs, and automated processes. All of this, however, has a price. CMOs have substantial difficulties managing the need for cutting-edge technologies while juggling intense financial pressures.

Additionally, the budgetary cuts are observed in end users in the European region, mainly due to the economic slowdown in the past few years. Owing to such budget cuts, many end users cannot afford costly medical devices and prefer lower-priced alternatives (such as refurbished devices) or undertake the upgradation of existing medical equipment and devices. This inturn reduces the contract lots quantity obtained by the CMOs from IVD brands.

IVD Contract Manufacturing Market Ecosystem

Leading players in this market include well-established and financially stable manufacturers of IVD devices & consumables and service providers. These companies have been operating in the market for several years and possess a diversified product portfolio, advanced technologies, and strong global presence.

The IVD consumables segment of IVD contract manufacturing industry is expected to register the highest CAGR during the forecast period.

Based on device type, the IVD contract manufacturing market is segmented into IVD consumables and IVD equipment's. In 2022, the IVD consumables segment is expected to register the highest CAGR during the forecast period. Numerous advantages like cost savings, reduced risk, reduced period length to market the product post production, increased speed of development, and acceesibility to new technologies. CMOs can provide greater flexibility in terms of production volume, batch size, and product mix. This can be helpful for companies that are developing new products or that have fluctuating demand. For example, a CMO may be able to produce small batches of a new product to test the market, or they may be able to increase production volume to meet demand for an existing product.

The immunoassay segment of the IVD contract manufacturing industry, acquired the largest share in the technology market.

Based on technology, the IVD contract manufacturing market is segmented into immunoassay, clinical chemistry, molecular diagnostics, microbiology, hematology, and coagulation & hemosatsis. . The imunoassay segment is acquired the largest share in the market followed by the clinical chemistry segment. The adoption of enzyme linked immunoassay rapid tests has increased due to their ability to provide testing in remote areas or emergencies where no sophisticated or advanced technology is available for disease screening. This supports the market growth.

The assay development segment of the IVD contract manufacturing industry is expected to grow at the highest CAGR during the forecast period.

Based on the service type, the IVD contract manufacturing market is segmented into manufacturing services, assay development services, and other services like maintenance services, testing services, distributorship services, and post sales customer support services. The assay development services segment is expected to grow at the highest CAGR during the forecast period. Large number of contract manufacturers providing assay services for numerous analyzers and consumables developed by the OEMs and the enormous rise in new and efficient tests for immunoassays, molecular diagnostic tests, clinical chemistry testing, etc. are factors that influence the growth of the market.

APAC is estimated to be the fastest-growing region of the IVD contract manufacturing industry.

The global IVD contract manufacturing market is segmented into North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa. In 2022, APAC is estimated to be the fastest-growing regional market for IVD. The high growth in this market can majorly be attributed to the increased government initiatives to boost the outsourcing capabilities of small-scale outsourced players, the low raw material to finished goods production costs, and cheap labour is obtained in this region.

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The prominent players in the IVD contract manufacturing market include KMC Systems (US), Cenogenics Corporation (US), Nova Biomedical (US), Cone Bioproducts (US), Invetech (US), Avioq Inc. (US), Meridian Bioscience Inc. (US), Kimball Electronics Inc. (US), Nemera (France), Viant Medical Holdings Inc. (US), Phillips Medsize Corporation (US), Nolato GW, Inc. (US), Stratec (Germany), Fujirebio (Japan), Biokit (Spain), Affinity Lifescience (Canada), Sekisui (US), and Prestige Diagnostics (Ireland).

IVD Contract Manufacturing Market Report Scope

The study categorizes the IVD Contract Manufacturing Market to forecast revenue and analyze trends in each of the following submarkets:

By Device Type

• IVD Equipment
• IVD Consumables

By Technology

• Immunoassay
• Clinical Chemistry
• Molecular Diagnostics
• Microbiology
• Hematology
• Coagulation & Hemostasis
• Others

By Service Type

• Manufacturing Services
• Assay Development Services
• Other Services

By Region

• North America
  • US
  • Canada
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Spain
  • Rest of Europe
• Asia Pacific
  • Japan
  • China
  • India
  • Australia
  • South Korea
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East & Africa

Recent Developments of IVD Contract Manufacturing Market

• In November 2022, Jabil Inc., expanded its developmental capabilities by opening a design center in Wrolaw, Poland. This would allow the company to develop leading-edge technologies for multiple industries including the automotive and healthcare sectors.
• In September 2021, TE connectivity acquired Toolbox Medical Innovations (US), Wi Inc. (US), and microLIQUID (Spain). The entities leverage design and manufacturing capabilities in the United States and Europe and are focused on serving a global client base ranging from startups to multinationals in the life science, IVD and cell therapy markets.

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