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U.S. Compounding Pharmacies Market Size By Pharmacy Type (503A, 503B), By Sterility (Sterile, Non-sterile), By Product (Oral, Topical, Rectal, Parenteral, Nasal, Ophthalmic, Otic), By Application (Paediatric, Adult, Geriatric, Veterinary), By Compounding Type (Pharmaceutical Ingredient Alteration [PIA], Currently Unavailable Pharmaceutical Manufacturing [CUPM], Pharmaceutical Dosage Alteration [PDA]), By Therapeutic Area (Hormone Replacement, Pain Management, Dermatology, Specialty Drugs, Nutritional Supplements), Industry Analysis Report, Growth Potential, Price Trends, Competitive Market Share & Forecast, 2021 – 2027

  • Report ID: GMI2961
  • Base Year: 2020
  • Report Format: PDF

Industry Trends

U.S. Compounding Pharmacies Market exceeded USD 4.8 billion in 2020 and is projected to grow at over 5.7% CAGR between 2021 and 2027. Increasing focus of industry players on introducing innovative and customized formulations that are effective in treating several diseases will propel the market growth. Rising prevalence of cancer along with growing public and private initiatives for compounding pharmacies will further enhance the market expansion. Increased drug shortages due to long lead times, scarcity of raw materials, delayed production, and surged drug failure rate will boost the market revenue.

U.S. Compounding Pharmacies Market

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Owing to the rising cases of COVID-19, the need for compounded pharmacies has also increased across the U.S. The FDA has allowed registered outsourcing facilities to compound specific medications used to treat critically ill patients in hospitals in response to the growing demand for drugs. According to the U.S. FDA, the supply of FDA-approved medicines and medicines compounded by outsourcing facilities may not be sufficient to fully address the need for drugs used to treat hospitalized patients.

Rising geriatric population base along with improved longevity will be the major factor accelerating the market value. As per the Population Reference Bureau, geriatric population in the U.S. is expected to reach 24% of total population by 2060. Longevity of the population has improved on account of decline in fertility rate and increased life expectancy. Additionally, affordable costs of compounding pharmacies proved beneficial for the overall industry growth over the forecast period. Higher proportion of people inclined towards compounding pharmacies and growing demand to look younger and youthful has resulted in augmented demand for anti-aging products across the U.S., favouring the market share. However, issues related to safety standards may impact the market demand.

Limitations associated with 503A pharmacy type may impede the market progression

The 503A segment in the U.S. compounding pharmacies market is predicted to witness 2.5% growth rate till 2027 as 503A compounding pharmacies are facilities wherein medication is formulated for domestic consumption. Compounding pharmacies has seen slothful the market growth owing to government limitations on drug manufacturing and requirement of authorized prescription. 503A pharmacies are banned from dispensing medication for office purpose that limit its product line, limiting its industry demand. In addition, these pharmacies require biannual environmental monitoring and audit for ensuring product quality and safety.

Rising demand for sterile medications will create robust growth opportunities

The sterile dosage form accounted for USD 1 billion in 2020. Growing incidence of chronic ailments such as cardiac and cancer diseases will stimulate the demand for sterile medications. Increasing demand for sterile compounding pharmacies due to adoption of parenteral and ophthalmic medications for several treatments will further fuel the industry revenue.

Parenteral segment is anticipated to upsurge the market expansion

The parenteral segment held 18% of the U.S. compounding pharmacies market share in 2020. Compounding ophthalmic care medications such as glaucoma medicines makes it affordable, thereby surging its acceptance rate. Moreover, compounded dosage forms such as glaucoma drops helps elderly patient minimize individual’s pressure along with confusion over several medications and dosing schedules, favouring the market value. Compounding ophthalmic medications are accessible in various dosage forms such as oral tablets, capsules injections and drops. Hence, growing availability of several dosage forms in ophthalmic care will drive the segment growth.

Increasing preference towards compounded medications among children will escalate the market revenue

U.S. Compounding Pharmacies Market By Therapeutic Area

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The paediatric segment is estimated to attain a CAGR of 7% through 2027. Children majorly find it interesting to swallow tablets and sometimes commercially available preparations are not be palatable. Hence, children may prefer customized compounded prescriptions as pharmacists develop flavoured, sugar-free dosage forms based on children’s needs, thereby increasing the market demand. Availability of several forms of customized medication for children include gummy treats, topical gels, effervescent drinks, oral liquids, will surge preference towards compounded pharmacies.

Rising usage of hormone replacement therapy will spur the segment expansion  

U.S. Compounding Pharmacies Market By Application

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The hormone replacement segment in the U.S. compounding pharmacies market was valued around USD 1.5 billion in 2020. Growing usage of hormone replacement in the treatment of several diseases including cancer, and in maintaining the hormonal levels in menopause, will enhance the need for compounding pharmacies. The increasing geriatric population base coupled with rising life expectancy has led to rise in number of patients suffering from hormonal imbalance. Hence, escalating potential for hormone replacement therapy will stimulate the demand for compounding pharmacies.

Increasing drug shortages will influence the market size

The currently unavailable pharmaceutical manufacturing segment crossed USD 1 billion in 2020. Medications may be unavailable due to several reasons such as manufacturing problems, discontinuation of certain medications owing to interruptions and decreased usage in supply chain. Rising number of chronic diseases requiring emergency medications along with surging drug shortages will foster the segment revenue.  

Presence of leading industry player’s across the U.S. proves beneficial for the market growth

Rising acceptance of compounding pharmacies coupled with favorable reimbursement policies across the U.S. will drive the demand for compounding pharmacies. In addition, technological advancements will lead to surge in effective compounding pharmacies, thereby augmenting the industry growth. The presence of leading companies along with well established healthcare infrastructure and facilities will fuel the market value.

Strategic initiatives undertaken by key companies have helped them to maintain strong position in the market

Some of the prominent leaders operating in the U.S. compounding pharmacies market include B. Braun, Fagron, Athenex Pharma Solutions, Dougherty's Pharmacy, Fresenius Kabi, McGuff Company and Institutional Pharmacy Solutions among others. The market participants are undertaking various organic and inorganic growth strategies to gather larger revenue share in industry.

Recent industry developments:

  • In May 2020, Wedgewood Pharmacy announced acquisition with Zoo, Wildlife specializations to acquire 503B outsourcing facility and state-licensed pharmacy. This strategy assisted the company in strengthening its market position.
  • In November 2020, B. Braun and Grifols formed strategic alliance.  Under this alliance, Grifols automated compounding portfolio and B. Braun's Safe Infusion Systems was combined for safe automated drug delivery and admixture. This development helped in broadening its product portfolio.

The U.S. compounding pharmacies market research report includes an in-depth coverage of the industry with estimates & forecast in terms of revenue in USD from 2016 to 2027, for the following segments:

Market, By Pharmacy Type, 2016-2027 (USD Million)

  • 503A
  • 503B

Market, By Sterility, 2016-2027 (USD Million)

  • Sterile
  • Non-sterile

Market, By Product, 2016-2027 (USD Million)

  • Oral
    • Solid preparations
      • Tablets
      • Capsules
      • Granules
      • Powder
      • Others
    • Liquid preparations
      • Solutions
      • Suspension
      • Emulsion
      • Syrup
      • Others
  • Topical
    • Ointments
    • Creams
    • Gels
    • Pastes
    • Others
  • Rectal
    • Suppositories
    • Enema
    • Others
  • Parenteral
    • LVP
    • SVP
  • Nasal
  • Ophthalmic
  • Otic

Market, By Application, 2016-2027 (USD Million)

  • Pediatric
  • Adult
  • Geriatric
  • Veterinary

Market, By Compounding Type, 2016-2027 (USD Million)

  • Pharmaceutical Ingredient Alteration (PIA)
  • Currently Unavailable Pharmaceutical Manufacturing (CUPM)
  • Pharmaceutical Dosage Alteration (PDA)
  • Others

Market, By Therapeutic Area, 2016-2027 (USD Million)

  • Hormone replacement
  • Pain management
  • Dermatology
  • Specialty drugs
  • Nutritional supplements
  • Others
Authors: Sumant Ugalmugle, Rupali Swain

Frequently Asked Questions (FAQ) :

The U.S. market for compounding pharmacies was over USD 4.8 billion in 2020 and will expand at more than 5.7% CAGR over the forecast period 2021-2027.

Parenteral product segment accounted for around 18% of the market share during 2020 and will grow owing to the affordable nature of compounding medications like glaucoma meds.

The compounding pharmacies industry size in the U.S. is estimated to register around 7% CAGR from the pediatric segment up to 2027.

The market share from hormone replacement had reached USD 1.5 billion during 2020 due to use in treatment for diseases like cancer and for maintaining hormone levels in menopause.

The industry share from sterile dosage from in the U.S. had cross USD 1 billion in 2020 and will expand with increasing prevalence of disorders like cardiac diseases and cancer.

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Premium Report Details

  • Published Date: Feb 2021
  • Companies covered: 13
  • Tables & Figures: 32
  • Countries covered: 1
  • Pages: 85

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