US Export Plan - Sector Report - Pharmaceutical Services

Industry trends

The global pharmaceutical services market is being shaped by outsourcing growth through contract research organisations (CROs) and contract development & manufacturing organisations (CDMOs), AI-driven drug discovery, supply chain resilience, and expansion into emerging markets. Looking ahead to 2030, the sector is moving towards greater digital health integration, sustainable sourcing, personalised medicine, and rising demand for obesity and oncology drugs.

Outsourcing and specialised services: Pharma companies are increasingly relying on CROs and CDMOs to accelerate drug development and reduce costs. Outsourcing spans various activities including drug discovery, clinical trials, manufacturing, and packaging.^[5] The US market is strongly aligned with this trend, with robust demand for CROs and CDMOs, and more investment in specialised services. The US biotechnology and pharmaceutical services outsourcing market was estimated at $10.3 billion in 2023 and is expected to grow at a CAGR of 5.05% from 2024 to 2030, reflecting sustained demand for consulting, auditing, and specialised external capabilities across research, development, and clinical operations.^[6]

However, the market is competitive, and Scottish firms will need to focus clearly on their distinctive advantages, including against companies in the sector from emerging markets, which may offer lower cost alternatives. Emerging market expansion is a key trend in the sector with countries in Asia-Pacific and Latin America gaining a larger share of global pharmaceutical output due to improved healthcare systems, better supply chains, and lower production costs. This is likely to further intensify competitive pressures on Scottish firms seeking to expand their exports to the United States over the coming years.

Artificial intelligence and data integration is another key trend. AI, real-world evidence, and advanced analytics are transforming drug discovery, clinical trial design, and regulatory submissions. Statista predicts that the global healthcare AI market will make up almost $188 billion by 2030, with a CAGR of 37% from 2022 to 2030.^[7] Within the US, there is broad deployment of AI and digital tools across R&D, clinical trials, supply networks, and commercialisation of pharmaceutical products and services. US biopharma is leaning into AI-driven transformation, with consulting analyses highlighting advantages such as improved anticipation of patient needs and better engagement and personalisation of services. Scottish companies that are not AI equipped or strong in data integration may increasingly struggle to compete in the US market, but those that have a competitive edge in this area will find a market that appears reasonably open to adoption. Companies in the sector should therefore consider improving capabilities around managing data volumes, in compliance with regulatory and data privacy requirements, as well as predictive capabilities through AI to encourage proactive rather than reactive interventions and support.^[8]

Supply chain resilience: Following on from the pandemic, pharmaceutical companies have been investing in diversified supply chains. This includes nearshoring, i.e. sourcing and exporting from geographically closer countries rather than relying on distant suppliers, and prioritising domestic capacity, to mitigate risks associated with global disruptions.^[9] US companies are increasingly integrating advanced technologies with robust sourcing strategies so they are better equipped to meet market demands and patient care needs in a range of scenarios. US policy has elevated pharmaceutical supply chain resilience as a strategic priority, including executive actions to build a Strategic Active Pharmaceutical Ingredients Reserve, prioritising onshoring in order to restore domestic capacity for essential products and reduce overreliance on offshore production.^[10] The requirement for this reserve evidences some existing issues within the US, such as concentration risks and pricing dynamics, that international companies have historically gained from. For example over 80% of the top generic medicines consumed in the US have no US source of their active pharmaceutical ingredients, and 72% of FDA-approved active pharmaceutical ingredients manufacturing facilities are located outside of the US.^[11] This creates a mixed picture for international pharmaceutical companies, who face both huge opportunity, with heightened demand for imports due to the critical need to fill existing gaps, but also scrutiny in exporting to the US market with stricter compliance and reshoring pressures.