Contract Research Organization (CRO) Services Market Size, Share & Industry Analysis, By Type (Early Phase Development Services [Chemistry, Manufacturing and Controls (CMC), Preclinical Service, and Discovery], Clinical [Phase 1, Phase 2, Phase 3, and Phase 4], Laboratory Services, and Others), By Application (Oncology, Neurology, Cardiology, Infectious Disease, Metabolic Disorder, Renal/Nephrology, and Others), By End-user (Pharmaceutical & Biotechnological Companies, Medical Device Companies, Academic & Research Institutes, and Others), and Regional Forecast, 2025-2032

The global contract research organization (CRO) services market size was valued at USD 85.54 billion in 2024. The market is projected to grow from USD 92.27 billion in 2025 to USD 175.53 billion by 2032, exhibiting a CAGR of 9.6% during the forecast period. North America dominated the CRO services market with a market share of 50.19% in 2024.

Contract Research Organizations (CROs) are companies providing research services, such as early phase development, clinical trials, research management plans, and others, to pharmaceutical, biotechnology, and medical device companies on a contractual basis. The growing awareness regarding outsourcing of clinical trial services, along with the increasing demand for effective therapeutics, is responsible for the market’s rapid growth.

Moreover, small and mid-sized pharmaceutical and life science companies prefer outsourcing their research and development processes for cost-effective and efficient conduction of the research studies. Therefore, the growing emergence of small and mid-sized biopharmaceutical companies is also responsible for the growth of the contract research organization services market.

• For instance, in November 2024, Novotech announced its partnership with Beijing Biostar Pharmaceuticals Co., Ltd. to enhance the clinical research and development plans of Beijing Biostar Pharmaceuticals Co., Ltd.

Market Dynamics

Market Drivers

Growing Number of Clinical Trials to Fuel the Demand for Contract Research Organization (CRO) Services 

In order to fuel the increasing demand for effective diagnosis and treatment, healthcare companies have increased their focus on conducting clinical trials to develop advanced and effective medical devices and therapeutics. The number of clinical trials conducted annually has been growing significantly worldwide.

• For instance, as per the data published by the World Health Organization (WHO), around 38,788 clinical trials were registered in 2024 globally, rising from 28,432 in 2010.

From research till the final drug approval, the drug development process is quite long and costly, for instance, as per the data published and updated by Sofpromed in January 2024, on average, phases 1, 2, and 3 can cost around USD 4.0 million, USD 13.0 million, and USD 20.0 million, respectively.

Moreover, not all the pipeline candidates need to get approved and commercialized; some are terminated, and some go on hold because of trial budgets and other such challenges. For instance, as per the data published by the Congress Budget Office in April 2021, only 12.0% of the drugs undergoing clinical trials are approved by the Food and Drug Administration (FDA).

In order to overcome these challenges, many small and mid-sized pharmaceutical companies have increased their focus on outsourcing their R&D activities to the CROs, as the CROs help these companies save time and money in developing their therapeutics or medical devices.

• In February 2023, Charles River Laboratories and Purespring Therapeutics partnered to develop and manufacture gene therapy targeting renal diseases.

Market Restraints

Stringent Regulatory Scenario along with Limitations in R&D Funds Restricts Market Growth

To set up a research site, the examiners are required to go through rigid administrative and ethical measures and regulatory strategies. The administrative methodology is vital in guaranteeing the well-being of the selected patients.

However, the whole regulatory procedure can cause delays in the recruitment and trial conduction if the time needed to get all the approvals is not considered in the planning phase.

• For instance, as per the research study published by the National Center for Biotechnology Information (NCBI) in 2021, delays in the initiation of clinical studies are majorly due to the delays in receiving ethical, legal, and other regulatory approvals.
• Moreover, as per the same source, the clinical studies also have difficulty in reaching the target sample size in the planned timeline due to delayed regulatory approvals.

Such complex and stringent regulatory scenarios varying from country to country have been restricting market growth.

Market Opportunities

Emergence of Promising Discoveries and Growing Funding is Expected to Fuel Need for Contract Research Organization (CRO) Services

The number of research studies being conducted is quite less for specific conditions such as perinatal conditions, congenital anomalies, and others. For instance, as per the data published by the World Health Organization (WHO), in 2024, the number of clinical trials registered for congenital anomalies was only 328, whereas the number of clinical trials registered for malignant neoplasms was around 5,306. However, a number of promising discoveries have emerged, and with the help of additional research, funding, and partnerships among the companies could lead to the drug discovery of advanced treatments.

• In March 2021, Natera Inc. entered into a collaboration with Tesis Labs, a U.S.-based multi-region lab services provider with labs in Colorado, Texas, and Arizona, to broaden Tesis Lab’s portfolio of genetic testing offerings.

Therefore, the increasing number of research studies on promising discoveries is expected to fuel the CRO services market growth in the forecast period.

Market Challenges

Regulatory Heterogeneity acts as a Challenge for Market Players’ Growth

Varying regional compliance standards require CROs to maintain deep regulatory expertise and regular check-ups for any changes or updates in the regulations.

• Increasing Cyber Threats Limits Patients’ Enrolling for Research Studies

Increasing cyber threats and tighter data protection laws have been restricting patients from participating in research studies.

• Shortage of Skilled Workforce Limits Companies Growth

The limited availability of skilled workforce has been restricting the efficiency of the services provided through CROs.

• Rising Operational Costs Restricts Market Players’ Expansion

Technological upgrades and compliance demand continuous investment in infrastructure and talent.

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CRO Services Market Trends

Rise in the Outsourcing of Clinical Trials due to High R&D Cost to Drive Market Growth

Due to the increasing demand for effective diagnosis and therapeutics, pharmaceutical, biotechnology, and medical device companies have increased their focus on R&D spending. This factor has been fueling the number of clinical trials being conducted globally.

• For instance, as per the data published by the European Federation of Pharmaceutical Industries and Associations (EFPIA), R&D expenditure by pharmaceutical companies in 2022 experienced a growth of 7.2% to reach USD 46,792.8 million.

Due to this, many biotechnology and pharmaceutical companies have increased their focus on outsourcing their R&D studies to Contract Research Organization (CRO) services providers. For instance, in March 2023, ICON plc LEO Pharma partnered together to conduct clinical trials to develop new effective medicines for dermatology indications.

Other Trends

• AI & Machine Learning Integration

CROs are leveraging AI for patient recruitment, protocol design, trial monitoring, and predictive analytics to enhance the efficiency of the studies.

• Decentralized Clinical Trials (DCTs)

COVID-19 fast-tracked the shift to remote monitoring, wearable tech, and virtual patient engagement. This created awareness regarding the advantages of decentralized clinical trials and has been fueling its adoption for cost-effective and convenient R&D.

• Emphasis on Personalized Medicine

The demand for personalized medicine is rising due to advancements in genomics, proteomics, and metabolomics, enabling tailored treatments based on individual characteristics and the growing awareness of the benefits of precision medicine. This factor has been fueling the demand for CRO services.

• Increased Outsourcing of Complex Trials

Lifesciences increased their focus on outsourcing complex clinical trials such as rare diseases, cancer, and others, which have low chances of positive results and have to undergo stringent regulatory scenarios. The aim of outsourcing these trials is to reduce the cost and total duration of the trial completion.

Impact of COVID-19

During the COVID-19 pandemic in 2020, the market experienced a significant boost in its market value. This was due to the increased demand for COVID-19 vaccines and therapeutics in order to control the disease burden. Many pharmaceutical and biopharmaceutical companies boosted their R&D and manufacturing processes to develop and distribute test kits, vaccines, and drugs against the SARS-CoV-2 virus. To accelerate the R&D process, many pharmaceutical and biotechnology companies have partnered with CRO services offering companies.

• For instance, in January 2021, Pfizer, Inc. and BioNTech partnered with ICON plc to develop a COVID-19 vaccine.

Furthermore, the market grew significantly post-COVID-19 due to the initiation of the delayed and postponed clinical trials.

Segmentation Analysis

By Type

Early Phase Development Services Segment Dominated Due to Rising Focus of Lifesciences Companies on Development of Advanced Products

By type, the market is divided into early phase development services, clinical, laboratory services, and others. 

The early phase development services are further segmented into Chemistry, Manufacturing and Controls (CMC), preclinical service, and discovery. Similarly, the clinical segment is further classified into phase 1, phase 2, phase 3, and phase 4.

The early phase development services dominated the market in 2024 and is expected to grow at the fastest CAGR during the forecast period. The dominance of the segment is attributed to the increasing focus of market players on boosting the early phase development services for chronic diseases. For instance, in December 2022, Phastar entered into Lean Life Science’s Oncology Development Programme (ODP2) with the aim of identifying and fueling the R&D for academics and early-stage companies.

The clinical segment is anticipated to experience significant growth during the forecast period. The segment’s growth is due to the growing number of small and mid-sized life science companies and research institutes with the aim of conducting clinical trials with the help of Contract Research Organization (CRO) services.

• For instance, in December 2023, Thermo Fisher Scientific Inc.’s PPD clinical research services business was selected by the Biomedical Advanced Research and Development Authority (BARDA) to conduct the first BARDA-supported Phase 2 clinical trial for the treatment of Acute Respiratory Distress Syndrome (ARDS).

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By Application

Oncology Segment to Dominate Led by Growing Burden of Cancer Diseases

Based on application, the market can be segmented into oncology, neurology, cardiology, infectious disease, metabolic disorder, renal/nephrology, and others. 

The oncology segment dominated the market in 2024 by accounting for a maximum contract research organization market share. The burden of cancer has been growing at a significant rate. Such an increasing burden of the disease has increased the demand for effective treatment options. In order to fulfill this demand, many life science companies have emerged to develop effective treatments. The emergence of such small and mid-sized companies has been fueling the outsourcing of preclinical and clinical services.

• For instance, according to the data published by the American Cancer Society, Inc., in 2023, the incidence of all types of cancer in the U.S. was 1,958,310, experiencing a growth of 2.1% from the prior year.

The others segment accounted for the second most dominant market share in 2024. The growth of the segment is attributed to the growing burden of diseases such as digestive diseases, nutritional deficiencies, respiratory disorders, and others. Moreover, the increasing funding by pharmaceutical and biotechnological companies for the effective therapeutic development of these diseases has been fueling the market growth.

• In October 2023, Forbion, a life sciences company, was involved in funding Aiolos Bio, Inc. for conducting phase 2 clinical studies to study the safety and efficacy of drug candidate AIO-001, indicated for treating asthma.

Moreover, the neurology segment is expected to grow at a significant CAGR during the forecast period due to the increasing prevalence of neurological disorders, such as Alzheimer’s, dementia, and others.

By End-User

Pharmaceutical & Biotechnological Companies to Hold Dominant Share Backed by Increasing R&D

Based on end-user, the market is segmented into pharmaceutical & biotechnological companies, medical device companies, academic & research institutes, and others.

The pharmaceutical & biotechnology companies dominated the market in 2024. Pharmaceutical and biotechnology companies have increased their preference toward outsourcing their R&D due to the increased complexity, robust pipelines, and tight rules for performing trials. This factor is responsible for the segment’s growth.

The medical devices segment is expected to grow at the fastest CAGR during the forecast period due to the rise in the number of registered clinical trials for medical devices.

For instance, as per ClinicalTrials.gov, in January 2022, approximately 40,901 clinical trials were registered for medical devices.

CONTRACT RESEARCH ORGANIZATION SERVICES MARKET REGIONAL OUTLOOK

In terms of region, the global market is studied across North America, Europe, Asia Pacific, and the rest of the world.

North America

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The North American CRO services market was valued at USD 42.94 billion in 2024 and is expected to hold a leading share of the global market in the forecast period. The regional value in 2023 was accounted for USD 40.01 billion. The market’s growth in the region is attributed to the strong presence of market players such as Medpace, IQVIA Inc., Syneos Health, and others.

Moreover, the market in the U.S. is expected to grow significantly during the forecast period due to the growing number of clinical trials in the region. The market in U.S. will account for USD 41.42 billion in 2025.  

• For instance, according to clinicaltrials.gov, as of January 2024, a total of 477,346 clinical trials are registered across the globe, out of which 30% (145,575) trials are registered in the U.S.

Europe

Europe is expected to be the second-largest region in the market with a value of USD 24.06 billion in 2025 and is estimated to hold a CAGR of 8.3% during the forecast period. The market growth in the region is attributed to the increasing investments by the pharmaceutical and biotechnology companies in R&D for new therapeutics development.

• According to data published by the European Federation of Pharmaceutical Industries and Association (EFPIA), in 2021, the pharmaceutical R&D expenditure in Europe reached 46,031.4 million, experiencing a growth of 52.3% from 2010.

The market size of U.K. is expected to be USD 5.55 billion in 2025. On the other hand, Germany is likely to be USD 5.12 billion and France is likely to be USD 3.45 billion in 2025.

Asia Pacific

The Asia Pacific market is projected to be the third-largest market with a value of USD 17.5 billion in 2025 and to grow at the fastest CAGR over the analysis period. The high growth is mainly attributed to the surge in R&D activity and the growing shift toward outsourcing. Furthermore, low-cost resources in the Asia Pacific region are one of the major factors driving the number of clinical trials being conducted in the region, thereby fueling the market growth. The market for China is expected to hit USD 5.07 billion in 2025. Meanwhile, India is likely to be USD 3.48 billion and Japan is projected to hit USD 3.18 billion in 2025.

• For instance, as per the World Health Organization (WHO), the number of clinical trials registered in Southeast Asia in 2022 reached 11,030, experiencing a growth of 48.5% from 2019.

Rest of the World

The market in the rest of the world is expected to hold a limited share of the market during the forecast period. However, increasing healthcare expenditure in the rest of the world is expected to fuel market growth.

COMPETITIVE LANDSCAPE

KEY INDUSTRY PLAYERS

Focus of Market Players on R&D for the Enhancement of their Service Offerings is Responsible for their Revenue Growth

IQVIA Inc., ICON plc, Syneos Health, and Charles River Laboratories are among the significant players in the market. These companies have been focusing on the enhancement of their service offerings by adopting advanced technologies with the aim of increasing their revenue growth.

• For instance, in November 2021, IQVIA Inc. announced a data aggregation strategy as the foundation to optimize the market insights. It helped the company to harness the right data and services to maximize the number of patients. This increased the efficiency of the company’s services.

Moreover, other market players, such as Parexel International (MA) Corporation, Thermo Fisher Scientific Inc., and Medpace, have been focusing on new service launches to enhance their presence in the market.

LIST OF KEY CONTRACT RESEARCH ORGANIZATION (CRO) SERVICES COMPANIES PROFILED:

• Medpace (U.S.)
• Fortrea (U.S.)
• ICON plc (Ireland)
• IQVIA Inc. (U.S.)
• Syneos Health (U.S.)
• Novotech (Australia)
• KCR S.A. (U.S.)
• Ergomed Group (U.K.)
• Thermo Fisher Scientific Inc. (U.S.)
• Charles River Laboratories (U.S.)
• Parexel International (MA) Corporation (U.S.)

KEY INDUSTRY DEVELOPMENTS

• February 2024 – Ergomed Group announced the expansion of its U.S. presence with a new office at Kendall Square in Cambridge, Massachusetts.
• February 2024 – Charles River Laboratories entered into a partnership with Wheeler Bio to expedite the progression from therapeutic discovery to manufacturing for its clients.
• January 2024 – WuXi Biologics collaborated with BioNTech SE to discover investigational monoclonal antibodies for developing next-generation therapeutic product candidates.
• February 2023 – Labcorp announced the spin-off of its clinical development business and the formation of this business segment as a new company, Fortrea.
• December 2021 – Laboratory Corporation of America Holdings completed the acquisition of Toxikon Corporation. This acquisition bolstered the company’s strong non-clinical development portfolio.

REPORT COVERAGE

The global market report provides a detailed market analysis. It focuses on key aspects such as an overview of the market, penetration of outsourcing in R&D and key countries, pricing analysis. Additionally, it includes key industry developments such as mergers, partnerships, & acquisitions, the impact of COVID-19 on the market, and brand analysis. Besides these, the report offers insights into the market trends and highlights key industry developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the market over recent years. The report also covers a regional analysis of different segments.

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Report Scope & Segmentation