Small molecules remain an attractive and growing market, with 54% of all molecules in clinical development comprising of small molecules (approximately 9,000 molecules)1. The small molecules clinical market experienced 28% growth2 between 2018 and 2023, and we anticipate this trend to accelerate further over the next five years.
In 2024, the outsourced small molecules market was valued at USD 75 billion3 and we estimate that this market will grow at 6 to 7% per year through to 20294. Our primary focus is to support the development and manufacturing of innovative products, and we expect this segment to grow at the higher end of this range.
Growth is driven by three main therapeutic areas, oncology, Central Nervous System (CNS) and endocrine (in particular diabetes and weight loss). Thirty percent5 of small molecules New Molecular Entities (NME) approvals by the U.S. Food and Drug Administration (FDA) are targeted towards oncology, a disease area estimated to sustain double-digit sales revenue growth per year through to 20296. Small molecules account for more than 60%5 of FDA NME approvals, of which approximately 80%7 are administered orally.
The required toxicity of products to destroy cancer cells means that they are often highly potent and need high containment manufacturing capabilities. We have a long and successful history of developing processes to manufacture highly potent active pharmaceutical ingredients (HPAPIs). In such complex containment environments, manufacturing experience and expertise is as critical as process control.
Increasingly, new therapies are on expedited timelines for approval. To support these timelines, our quality system and regulatory experts can support customer filings. This is a particularly important service for small companies who may not have in-house capabilities.
Source: Citeline, pre-clinical excluded.
Source: Citeline.
Source: Small Molecule CMO/CDMO Market Outlook from 2024 to 2034.
Source: Small Molecule Contract Manufacturing: CDMO Market Overview – PharmaSource; Lonza internal analysis, FDA, Evaluate Pharma.
Source: Intern multi-year Analyses of FDA NME Approvals.
Source: EP 2024.
Source: Citeline, Pharmacircle 2024.
Our Small Molecules division1 provide contract development and manufacturing services for customers including large pharmaceutical and small biotech companies. We focus on helping customers develop and manufacture innovative small molecules. Over the last 40 years, we have built a leading reputation in this space, supported by our commitment to science, technology and delivery. We work in close partnership with our customers, helping them to address challenges and support molecule progression through clinical stages. Our team of experts supports development throughout the product lifecycle, from pre-clinical stages through to commercialization. Entry points in this lifecycle can vary from early clinical development to late-phase or commercial supply.
Our Small Molecules services can broadly be split into three categories: Drug Substance, Drug Product and Particle Engineering, which forms a bridge between Drug Substance and Drug Product.
Our new organizational structure, announced in December 2024, will become operational on 1 April 2025 with three integrated business platforms: Integrated Biologics, Advanced Synthesis and Specialized Modalities. Capsules & Health Ingredients, which we plan to exit at the appropriate time, will operate as an independent business platform.
pre-clinical and clinical small molecules1
commercial small molecules1
Including active pharmaceutical ingredients (API), highly potent API (HPAPI), dosage form and delivery systems and particle engineering.
Our Drug Substance services relate to the development and manufacturing of active pharmaceutical ingredients (APIs). Our Particle Engineering services relate to our micronization and spray-dried dispersion technologies, which support enhanced bioavailability. Finally, our Drug Product services support oral and inhaled formulations of APIs in tablet and capsule dosage forms.
Our current portfolio includes more than 125 commercial programs and more than 205 pre-clinical and clinical programs. These are delivered by a global asset network capable of supplying a range of volumes to meet both clinical and commercial demand. Our ability to provide integrated supply chains for products, within or across divisions, is a compelling customer offering that simplifies ways of working.
In Drug Substance, we continue to build on our existing capabilities in developing and manufacturing highly potent small molecules, especially the payload and linker manufacturing of antibody-drug conjugate (ADC) products. These represent a particularly attractive market segment within the HPAPI category.
Candidates in the small molecules pipeline are increasingly complex and are often accompanied by a decrease in bioavailability due to their limited solubility. We help customers to address these challenges through a portfolio of bioavailability enhancement technologies, phase-appropriate and proprietary processing equipment, and drug delivery capabilities. Our site in Bend (US) specializes in improving bioavailability, leveraging our scientific expertise and spray-dried dispersion technology.
In 2024, our Small Molecules division reported sales growth of 9.3% CER compared to the prior year at a strong CORE EBITDA margin of 35.7%, driven by high commercial demand, strong operational performance and the division’s continued portfolio shift to high-value products and complex service offerings. The division signed the highest number of new customers and programs compared to previous years. Furthermore, three drug products manufactured by the business received FDA approval in 2024, and the batch success rate in commercial manufacturing exceeded 99%.
Looking ahead, we will continue our focus on being a strong development and manufacturing partner to support our customers during the entire lifecycle of their products. This includes introducing new offerings and expanding our capacity to meet evolving needs.
Comparison vs. Prior Year
Sales (CHF)
CORE EBITDA (CHF)
CORE EBITDA Margin
Sales growth, expressed as a percentage (%), are at constant exchange rate (CER).
In 2024, we launched two new market offerings: AI-enabled route scouting, and spray-dried biologics for pulmonary delivery. Together with the Physiology Based Pharmacokinetics and Solid Form Services offerings, these new advances further strengthen our positioning as a strong development partner, accelerating growth in our early-phase pipeline.
Active pharmaceutical ingredients (API) synthesis is becoming increasingly complex and lengthy, often requiring more than 20 synthetic steps. We have implemented an AI-driven solution that accelerates this process. Our new AI-enabled route scouting service provides customers with synthetic pathways that are more resilient from a supply chain perspective and offer insights into optimal route design for both clinical and commercial manufacturing.
Building on more than 20 years of experience in the spray-drying of biologics, such as monoclonal antibodies (mAbs), oligonucleotides and peptides, we now offer spray-drying of biologics for clinical supply and beyond.
President, Small Molecules Division
We remain committed to being a strong development partner driven by science. In response to positive market dynamics, and listening to our clients' needs, we are planning for future growth by strengthening our early-phase offerings, and investing in additional development and manufacturing capacity to be present throughout the full product lifecycle.
In 2024, we continued to invest in adapting our capabilities and commercial offerings in line with market needs. We augmented this with additional capacity to meet sustained customer demand, particularly in relation to complex molecules and HPAPIs.
To support our customers in advancing their therapeutic candidates, our Bend (US) site is globally recognized for its expertise in improving bioavailability, a critical factor in addressing the poor solubility of many small molecule drugs. We continue to invest in this area and have the Bend site in 2024 by adding new clinical bottling and labelling capabilities for tablets and powder-filled capsules. In addition, we expanded the site to include clinical manufacturing of spray-dried protein formulations for pulmonary delivery, aligning with growing industry trends.
Staying competitive in the CDMO space requires ongoing investment and continuous improvement, with a strong focus on advancing digitalization in the development and manufacture of therapeutic drugs. Our Small Molecules division is focused on addressing the increasing complexity of small molecule-based drug candidates. A key piece of this puzzle is that the intricate structures of modern drug candidates require multiple synthetic steps to produce them. To address this growing challenge, we are utilizing AI-enabled route scouting to identify chemically feasible synthetic pathways that can be optimized for performance, efficiency and manufacturability.
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