Thiruamuthan T K, Correspondent, India Pharma Outlook
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The CDMO pharmaceutical industry has shifted from being a quiet back-office partner to becoming one of the most strategic enablers in modern drug development. In today’s competitive pharma landscape, where timelines are compressed, regulatory complexity is rising, and global supply chains are under pressure, CDMOs are no longer just “outsourcing partners.” They are now the architects of CDMO supply chain agility, helping pharma companies bring medicines to market faster, more reliably, and more cost-effectively.
According to McKinsey & Company, more than 70 percent of pharmaceutical companies outsource some aspect of manufacturing to CDMOs. In India, this outsourcing trend is strengthened by national initiatives such as Make in India and Pharma Vision 2020, both aimed at positioning the country as a global pharmaceutical hub.
So, why pharma companies outsource to CDMOs? The answer lies in their ability to combine specialized technical expertise, flexible pharma manufacturing capacity, faster regulatory navigation, and cost efficiency — all of which free drug developers to focus on core R&D rather than infrastructure-heavy manufacturing.
As Vivek Sharma, Executive Chairman of Suven Pharmaceuticals, puts it:
“Outsourcing has been on the rise… India has to grow, and India will grow.”
The pharmaceutical supply chain has never been more complex. Traditional in-house manufacturing models are slow to adapt, require massive capital investment, and often struggle to handle sudden demand surges or new technology integration. CDMOs, in contrast, offer built-in flexibility.
They can scale production up or down based on market needs, integrate new manufacturing technologies such as continuous manufacturing and digital twins, and handle multi-market regulatory requirements without forcing pharma companies to reinvent their processes.
According to Dr. Rajeev Singh Raghuvanshi, Drugs Controller General of India (CDSCO):
“India’s CDMO sector is critical for ensuring uninterrupted access to safe, quality medicines in both domestic and export markets. Their agility is central to supply chain resilience.”
CDMOs vs traditional pharma manufacturers is more than a cost conversation — it’s about operational philosophy.
Both the US FDA and the European Medicines Agency (EMA) recognize CDMOs as key partners in strengthening the drug development supply chain, especially for biologics, high-potency APIs, and specialty formulations.
India’s advantage is clear. India.gov.in reports that the country is the largest supplier of generic medicines globally, exporting to over 200 countries, a credibility that strengthens pharma CDMO partnerships worldwide.
As Annaswamy Vaidheesh, Executive Chairperson at Suven Pharma, says:
“It’s the Infosys moment… we may expect to see that happen in the Indian pharmaceutical services industry in the next decade and beyond.”
The agility of pharma manufacturing was tested during the COVID-19 pandemic. When demand for mRNA vaccines surged, CDMOs were able to retool production lines in record time.
An EMA study confirmed that CDMOs were instrumental in meeting global vaccine needs, while also ensuring continuity for critical non-COVID drugs.
In India, the Production Linked Incentive (PLI) Scheme has turbocharged local API and bulk drug manufacturing, cutting import dependence and bolstering national health security.
As Dr. Himanshu Gadgil, CEO of Enzene, notes:
“In light of ongoing geopolitical tensions, clients are revisiting their strategy.”
Case in point: Indian CDMOs like Syngene International produced both COVID-related and non-COVID critical medicines without disruption — a feat few traditional manufacturers could match.
The CDMO market growth story is one of rapid expansion.
Key growth drivers include:
As Ashu Tandon, CCO of Aragen, explains:
“India has a stellar reputation… Indian CDMOs are now increasingly investing in biologics manufacturing to replicate this success.”
The Department of Pharmaceuticals (DoP) reinforces this optimism:
“CDMOs are integral to our vision of positioning India as the preferred global hub for end-to-end drug development and manufacturing services.”
If we look at the benefits of CDMOs in the drug development lifecycle, the advantages are end-to-end:
According to Jonathan Hunt, CEO of Syngene:
“We took the decision… to forward integrate, first into development services and then into manufacturing.”
And Abhishek Aggarwal, COO of Bharat Rasayan, adds:
“Indian enterprises are more desired… The safety and reliability we offer isn’t being matched by Chinese players.”
As Krishna Kanumuri, CEO of Sai Life Sciences, puts it:
“The government has to understand that this industry has potential, if not scale, right now.”
Digitalization is no longer optional in flexible pharma manufacturing. CDMOs are embracing:
These tools not only improve operational efficiency but also strengthen CDMO role in pharma innovation.
Yes — sustainability is fast becoming a business differentiator.
McKinsey projects that green chemistry could reduce pharma manufacturing emissions by 25 percent by 2030. Many Indian CDMOs are already adopting:
The National Pharmaceutical Pricing Authority (NPPA) supports this push, noting:
“Sustainable manufacturing practices are essential not only for environmental goals but also for long-term competitiveness in the pharmaceutical supply chain.”
Looking ahead, CDMOs will be shaped by:
As Ashu Tandon of Aragen notes:
“We have prioritized enhancing our supply chain flexibility… imports of raw materials have reduced from around 60 percent to 20 percent in the last 3–5 years.”
The Pharmacy Council of India (PCI) adds:
“Building advanced pharmaceutical manufacturing skills is key to sustaining India’s leadership in CDMO services.”
The CDMO pharmaceutical industry has evolved from a cost-saving outsourcing model into a strategic growth engine for the global pharmaceutical sector. In India, backed by PLI incentives, Make in India, and a strong innovation culture, CDMOs are set to dominate the next phase of pharma manufacturing agility.
As Annaswamy Vaidheesh says:
“It’s the Infosys moment for India’s CDMO sector.”
For pharma companies, the question is no longer whether to partner with a CDMO? It’s about choosing the right partner to accelerate innovation, ensure supply chain resilience, and drive long-term competitive advantage.
CDMOs offer advanced expertise, scalability, and speed without heavy capital investment, allowing pharma companies to focus on innovation and market delivery.
They provide flexible capacity, diverse sourcing, and contingency planning, enabling pharma companies to adapt quickly to market changes and global disruptions.
Prioritize proven quality systems, regulatory compliance, cultural fit, and transparent communication to ensure the CDMO works as a trusted extension of your team.
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