The advent of the COVID-19 pandemic in 2020 highlighted the importance of the pharmaceutical and biopharmaceutical sectors as scientists worked tirelessly utilizing analytical and scientific instruments to create vaccines to combat the virus. Now that the pandemic has subsided, both the pharma and biotech markets are struggling with issues such as lack of funding for capital expenditures and macroeconomic obstacles.

As a result, select firms that manufacture analytical and scientific instruments have experienced sales declines in the pharmaceutical and biotech end-markets. However, according to market research and intelligence firm SDi, demand for analytical and scientific instruments will stabilize due to the technical advancements of these technologies, which will help pharmaceutical and biopharmaceutical end-users reduce costs and accelerate the process of drug and therapeutic discovery, development and production.

SDi expounds on their forecast in its September 2024 “Lab Instrumentation Market for Pharmaceuticals & Biopharmaceuticals” report. The report provides an overview of different sectors’ applications of instrumentation techniques and potential opportunities and threats to the market. For the overall market and each analytical technology category in the report, SDi forecasts instrument demand by region, analytical technique, therapeutic type and more.

The categories of analytical and scientific instrumentation highlighted in the report are atomic spectroscopy, bioprocessing, chromatography, imaging, lab automation, life science instrumentation, mass spectrometry and more. The report also specifies the top vendors for each of the respective technologies. For example, SDi highlights Agilent Technologies, MilliporeSigma, Thermo Fisher Scientific and others in the report. For the report, SDi utilized secondary sources such as financial reports, industry publications, website information, etc.

According to the report, in 2023, the laboratory instrumentation market for the pharmaceutical and biopharmaceutical end-markets was valued at over $27 billion and is forecast to expand at a mid-single digits CAGR through 2028. In addition, chromatography, life science instrumentation, and lab automation & software accounted for the pharmaceutical and biopharmaceutical markets’ most significant analytical technology segments in 2023. SDi forecasts imaging and life science instrumentation will grow at a similar CAGR in high single-digit rate through 2028.

Life Science Instrumentation

SDi predicts that life science instrumentation will see an increase in demand in 2023–2028 despite facing challenges stemming from receding COVID-19-related needs after a surge in 2021. Specifically, waning pandemic-related activity caused a slowdown in biotech funding, and customer destocking of existing inventory has impacted life science instrumentation sales. However, SDi believes that the market for life science instrumentation will overcome these challenges because of stable demand in the small molecule pharmaceutical market and specific needs in select regions.

SDi expects molecular biology techniques, such as long-read sequencing and CRISPR/Cas9, to be primary growth drivers in the life science instrumentation market thanks to their capabilities in helping end-users conduct nucleic acid-based therapeutics activities. Among the top vendors of life science instrumentation are Cytiva (Danaher), Illumina and Thermo Fisher. Cytiva and Thermo Fisher provide products and services to most life science technology market segments, such as label free detection and patch clamping. At the same time, Illumina is a large provider of sequencing products.

Imaging

Imaging systems have experienced rapid sales growth over the past five years. As a result, SDi expects imaging system demand to increase at a high single-digit CAGR from 2023 through 2028. Imaging’s presence in the pharmaceutical and biopharmaceutical sectors has expanded partly because of the rise of proteomics and protein-based clinical therapies. Nonetheless, SDi notes that rising interest rates, which have led pharmaceutical and biopharmaceutical end-users to have limited funding for capital equipment, are negatively impacting near-term demand for imaging instruments.

Regarding application, SDi forecasts spatial omics instruments as a leading growth driver within the imaging market. For instance, one reason spatial omics systems have experienced a surge in demand is because they allow end-users to study cells in their native environment. Top vendors in the imaging market include 10x Genomics, a leading provider of spatial omics systems. Also, Lecia Microsystems (Danaher) and ZEISS are top imaging system providers thanks to being the largest optical and confocal microscope providers.

Conclusion

Despite market challenges such as trade tension with China and lack of funding in the emerging biotech sector, SDi believes the analytical and scientific instrumentation market will continue to benefit from potential opportunities in the pharmaceutical and biopharmaceutical markets. These opportunities include advancement in next generation sequencing (NGS) technology and the reshoring of pharmaceutical and biopharmaceutical development activity from China to countries such as Mexico, Africa and South America.