At the onset of global economic recession, several pharmaceutical companies were compelled to seek ways of minimizing cost of drugs, which in turn forced them to evaluate opportunities for manufacturing outsourcing and due to this, the overall pharmaceutical contract manufacturing market maintained a positive growth posting only a moderate slowdown in growth. The US represents the largest regional market for pharmaceutical contract manufacturing (PCM) worldwide. Europe trails behind the US. Japanese market for pharmaceutical contract manufacturing alone is projected to register a compounded annual growth rate of 12.80%. Segment-wise, solid dosage forms represent the largest segment in US contract manufacturing segment. The market for liquid dosage forms is projected to record a compounded annual growth rate of close to 6.0%. USA accounts for approximately 40% of the total contract manufacturers in the world.   Over the years, PCM outsourcing shifted its base to low-cost nations to take advantage of low cost manufacturing. Many pharma giants initiated partnering with India and China for manufacturing of drugs, the only reason being these countries have knowledgeable human resource that carry out drug research, development and manufacturing at lower cost than the US or European CMOs. But due to weak government drug regulation and inspection in both India and China, the U.S. Food and Drug Administration conducted inspections in India and china which resulted in various enforcement actions, such as fines and blocking importation of certain drugs made in India until regulatory requirements are complied with. As a result of this, a lot of contract manufacturing returned back to US. European pharma companies bought their manufacturing back to US primarily due to the logistics, transportation, risk to products and tolerance to risk. The focus on cost reduction initially associated with the growth of outsourcing no longer seems to exist today. Quality has surpassed cost saving as key criteria when companies choose contract service partners.  A market survey from industry experts reveals that quality and reliability are two top priorities while affordability has dropped its position. Global pharma contract manufacturing market is expected to witness a large number of merger and acquisitions in near future. This can be mainly attributed to the desire of contract manufacturers to provide integrated services offerings across the entire pharmaceutical development cycle from discovery to commercialization (API and formulated drug products) and life cycle management.