Contract manufacturing is contractual engagement of a third-party provider to manufacture a product. It has become an increasingly attractive option over the last decade for chemical, pharmaceutical, and biotechnology companies seeking to reduce costs and operate competitively in a rapidly changing business environment due to advancing technology.
In the chemical sector, contract manufacturers enable increased manufacturing capacity and flexibility without large capital investments by those requiring the service, as well as access to synthetic and process expertise that may not be available in-house. It also reduces management of safety and regulatory issues.