Viral Vaccines

Viral Vaccines Global Market Outlook

• The global demand is expected to grow at approx. 7 percent CAGR through 2020–2027 and would reach approximately $ 58.4 Billion by the year 2024. 15-20% of the growth can be attributed to vaccine development and testing

• Rise in prevalence of several infectious and non-infectious disease is promoting technological advancements in faster production of vaccines, and large number of international vaccination programs, government and non-government initiatives, and increase in demand for combined vaccine are responsible for boost in the market growth

• Large CROs have been continuously expanding their supply base through acquisitions and partnerships to provide integrated services related to vaccine production

Global Market Size: Viral Vaccines

• There is an increasing awareness of immunization and a inspiration to formulate strong vaccine pipeline and the increasing focus of the key pharmaceutical players to develop innovative vaccines. These factors are driving the market with a CAGR of 7 percent and is expected to reach $71.65 billion by the end of 2027.

• The market dynamics of research chemistry can be understood from the demand–supply perspective

• From the demand side, pharmaceutical companies are facing pipeline issues and outsourcing additional activities. This trend has led to the emergence of outsourcing of production services, with emerging nations like India and China becoming favorable destinations

• The viral vaccine production function is highly outsourced to leverage technical expertise and specific therapeutic area skill set at CROs

Regional Market Share

• It is easier to offshore more routine services, like Live-attenuated vaccine production and Subunit Vaccine production, to emerging regions, like India and China. However, services, like Toxiod Vaccines and Conjugated Vaccine Production that require strict regulatory guidelines, are mostly near shored to the developed markets

• This is expected to change in the future with suppliers, like Wuxi Optec, building capabilities in technologies, like computer-aided drug development and identify potential drug candidates in lesser time. Such factors will expedite the drug development process

Cost Structure of Viral Vaccines

Cost for product development, equipment's and labor contributes a maximum of 65-70 percent of the overall agency base price, and comprises of direct cost (buying or manufacturing cost) and indirect cost (third-party engagement cost). Another factor is skilled labour cost, which differs widely, depending on the scope of the trials, location and the therapeutic area involved (e.g., average FTE cost depends upon the location and therapeutic area)

Price Drivers

• The viral vaccines market is primarily driven by the rising prevalence of infectious diseases, innovative technology in vaccine development, increased funding from governmental and international organizations, and the rising awareness on preventive care.

• This overhead cost component includes fees for service and facilities, technology deployment/up gradation cost, and out-of-pocket cost

• Contribution to overall agency cost solely depends on the type of trial and location of the manufacturing

• Labor cost includes direct payroll cost and the cost of temporary players or third-party engagements

• Labor cost will continue to increase (at an average rate of 2-3 percent) as vaccine production requires specialist attention, and will drive extensive third-party resource allocation