Pharmaceuticals and Biotechnology

Moving forward, the pharmaceuticals and biotechnology industry will continue to grow. The research group IBISWorld predicts that the brand name pharmaceutical manufacturing industry will expand through 2026, in spite of the growing market competition and scrutiny over pricing of branded products. Revenue prospects may be dampened somewhat by the movement to offer low-cost drugs to the health care system. In 2023, there were 3,351 brand name pharmaceutical manufacturing companies in the U.S., which employed 277,579 workers. This biotechnology industry is projected to regain ground through 2029, as the economy rebounds and investment levels rise. As of 2023, the U.S. biotechnology industry had 3,429 businesses and employed a total of 408,376 people.

Global drug sales reached $1 trillion for the first time in 2014 and reached nearly $1.5 trillion in 2022, according to Statista.com. Worldwide drug sales are projected to grow from $325.2 billion in 2020 to $502.4 billion by 2026, according to Expert Market Research.

On the other hand, the innovative pharmaceutical industry is “currently facing unprecedented challenges caused by slower sales growth, expiring patents, increasing competition from generics, shorter product life cycles, tighter regulations, adverse media coverage and reputational damage, and a decline in the number of new innovative drugs under development,” according to the International Trade Administration. “The industry is adjusting to a more competitive environment by shifting manufacturing and other operations overseas, revamping research pipelines, reducing employment, particularly in sales but also in manufacturing and research, and organizing mergers and acquisitions.”

Major factors that affect employment in the pharmaceutical industry include the rising costs of research and development (it costs an average of $1 billion to develop each drug that gets approval, according to a study by the Journal of the American Medical Association) and the outsourcing research and development and manufacturing to emerging countries such as India and China. “Although the United States remains the global leader in innovative R&D investment, producing more than half the world’s new molecules in the last decade, its continued leadership cannot be taken for granted,” according to the International Trade Administration. “R&D performed in the United States has become increasingly expensive relative to emerging economies in Asia, such as China and Singapore, where governments have enacted policies to attract investment and are poised for future growth. Conditions that limited R&D offshoring in the past, such as market proximity and availability of talent, are rapidly shifting.”

Other factors that affect employment include government pressure on pharmaceutical manufacturers to cut drug prices, mergers and acquisitions that have reduced the number of workers in the industry, and improvements in manufacturing technology, which have increased worker productivity.

Shorter exclusivity periods—the amount of time a drug company can hold a patent on a particular drug—also affect large pharma companies. Generic drugs have more than quadrupled their share of the prescription market—from 18.6 percent at the end of 1984 to 91 percent in 2023, according to IQVIA, a provider of advanced analytics, contract research services, and technology solutions to the life sciences industry.

Despite these challenges, the future is still bright for the pharma/biotech industry. The growing elderly population will need new medications and treatments. The increasing number of public and private health insurance programs, which cover some or all of the costs of drugs, will help people afford medications and create more demand for pharmaceuticals. The growing popularity of “lifestyle” drugs that treat non-life-threatening conditions and that increase human happiness and/or confidence will also safeguard the future of jobs in this field. Examples include drugs that are used to treat obesity, baldness, impotence, and the effects of aging, as well as medications that improve mental agility. Demand for over-the-counter (OTC) drugs is also expected to increase as the population grows. In 2022, sales in the OTC drug industry reached $162 billion, according to Global Market Insights, and it is expected to reach $266 million in market value by 2032. It is estimated that there are 100,000 to 300,000 OTC drug products marketed to consumers in the United States. Also, although the pharma/biotech industry is not immune to economic downturns, the brunt of a bad economy is softened because many people depend on medications for routine—and/or life-sustaining—health-care needs.

Strong growth is expected for professional specialty occupations. For example, employment for biochemists and biophysicists is expected to grow much faster than the average for all careers through 2031, according to the U.S. Department of Labor (DOL). The DOL says that “the aging population will drive demand for new drugs and procedures to prevent, cure, or manage disease. This increased demand is, in turn, likely to create demand for biochemists and biophysicists involved in biomedical research. For example, biochemists and biophysicists will be needed to conduct genetic research and to develop new medicines and treatments that are used to fight genetic disorders and diseases, such as cancer. They also will be needed to develop new tests used to detect diseases and other illnesses.” Opportunities will also be strong for biomedical engineers, bioinformatics specialists, microbiologists, data scientists, biostatisticians, systems analysts, computer support specialists, and information security professionals.

Fewer opportunities are expected in administration and production. Little or no change in employment is projected for administrative and clerical workers as companies streamline operations and rely more on computers. Production jobs will decline or experience little growth as technology (including advanced manufacturing techniques) improves efficiency and reduces the number of workers needed to oversee production processes. Advanced manufacturing processes require production workers to have more education and training. While there will be fewer job opportunities, the positions that remain will offer higher earnings and more demand (because there is a shortage of skilled workers). Technicians and other production workers with experience, certification, and expertise in advanced manufacturing tools, processes, and equipment will have the best job prospects.

Advances in biotechnology have had a major effect on the drug discovery and development process. Biopharmaceuticals is the largest biotechnology subsector, and opportunities for life and medical scientists will be strong because biopharma companies invest so much money in research to identify the next hot biopharma product. More than 300 new biopharmaceutical medicines have been approved for use in the last decade, according to Pharmaceutical Research and Manufacturers of America. Approximately 900 biotechnology medicines and vaccines are currently in development to treat diseases such as cancer, diabetes, and heart disease.

Another emerging subfield in pharmaceuticals is ethnobotany. Interest in this field should stimulate competition and job growth as pharmaceutical companies rush to take advantage of the world’s diminishing biodiversity, especially in tropical regions. Good opportunities should exist for chemists, pharmacologists, biologists, science technicians, research and development managers, and marketing and sales workers. Those with doctoral degrees will have the best employment prospects.

Global medical technology revenues are expected to increase from $495.46 billion in 2022 to $718.92 billion by 2029, according to Fortune Business Insights, a market research firm. Employment in the field is expected to remain steady as advances in technology, such as the development of implantable defibrillators and new imaging modalities, create demand for workers. Factors that may limit growth include increasing government regulation and changes to the health-care industry, which may influence purchasing trends for medical technology.