Cannabinoid Based Drug Discovery And Development Market Expected to Reach $1.8 Billion by 2034

According to a new report published by Allied Market Research, titled, “Cannabinoid Based Drug Discovery And Development Market," The cannabinoid based drug discovery and development market size was valued at $1.3 billion in 2024, and is estimated to reach $1.8 billion by 2034, growing at a CAGR of 3.3% from 2025 to 2034.

Cannabinoid based drug discovery and development focus on leveraging the therapeutic potential of cannabinoids, the active compounds found in cannabis, for various medical conditions. Research in this field explores both naturally derived cannabinoids, such as tetrahydrocannabinol (THC) and cannabidiol (CBD), and synthetic analogs that target the endocannabinoid system. This system plays a crucial role in regulating pain, inflammation, appetite, mood, and immune response. Drug development efforts have led to FDA-approved medications like Epidiolex (CBD) for epilepsy and synthetic cannabinoids like dronabinol and nabilone for chemotherapy-induced nausea.

According to cannabinoid based drug discovery and development market forecast analyis the market is driven by advancements in drug formulations, expanding consumer awareness and supportive government initiatives. Advancements in drug formulations have significantly propelled the growth of the cannabinoid based drug discovery and development market. Innovations in delivery systems, such as nanotechnology-based formulations, and transdermal patches, have enhanced the bioavailability and therapeutic efficacy of cannabinoid drugs. Thus, the advancement in drug formulation is expected to contribute significantly in the growth of cannabinoid based drug discovery and development market size.

According to 2024 article by National Library of Medicine, delivery of cannabis using nanocarriers focus on improving bioavailability, prolonging release, and targeting specific areas. This synthesis highlights the potential of nanotechnology to enhance cannabis therapies and pave the way for innovative interventions and precision medicine. 

Additionally, according to cannabinoid based drug discovery and development market trends analysis the development of novel synthetic cannabinoids with targeted pharmacokinetics has expanded their potential therapeutic applications, particularly in pain management, neurology, and oncology. Pharmaceutical companies are also leveraging advanced formulation techniques to optimize drug absorption and minimize psychoactive effects, making cannabinoid based therapies more viable for broader clinical use. Thus, the development of novel synthetic cannabinoids is expected to drive the growth of cannabinoid based drug discovery and development industry.

Expanding consumer awareness is a major factor driving the cannabinoid based drug discovery and development market growth. Increased public understanding of the therapeutic benefits of cannabinoids, fueled by growing scientific research and media coverage, has led to higher acceptance of cannabinoid based treatments for conditions such as chronic pain, epilepsy, multiple sclerosis, and cancer-related symptoms. The widespread availability of information through online platforms, advocacy groups, and healthcare professionals has educated consumers about the potential of cannabinoids in managing various medical conditions, leading to greater demand for cannabinoid based pharmaceuticals. 

As awareness continues to expand, more patients are seeking cannabinoid based therapies, prompting pharmaceutical companies to invest in research and development efforts to meet the rising demand. This increased consumer interest is also driving partnerships, funding, and innovation in cannabinoid based drug discovery and development.

The cannabinoid based drug discovery and development industry is segmented on the basis of drug development stage, receptor target, end user, and region. On the basis of drug development stage, the market is divided into preclinical studies, and clinical trials. Depending on receptor target, the market is divided into CB1 (Agonist, Antagonist, and Inverse Agonist), CB2 (Agonist, Antagonist, and Inverse Agonist), FAAH Inhibitor, MAGL Inhibitor, FAAH-MAGL Dual Inhibitor, and TRPV1 (Agonist and Antagonist). 

On the basis of end user, the market is segmented into pharmaceutical companies, research institutes, and contract research organizations. Region wise, the market is analyzed across North America (U.S., Canada, and Mexico), Europe (Germany, France, UK, Italy, Spain, and Rest of Europe), Asia-Pacific (India, South Korea, Australia, and Rest of Asia-Pacific), and LAMEA (Brazil, Saudi Arabia, South Africa, and Rest of LAMEA).

On the basis of receptor target, the CB1 receptor segment was the major revenue contributor in 2024. This is attributed to its critical role in modulating neurological and metabolic functions. As a primary component of the endocannabinoid system, CB1 receptors are abundantly expressed in the central nervous system, making them a key target for developing therapeutics aimed at neurological disorders such as epilepsy, multiple sclerosis, and chronic pain. The growing prevalence of these conditions has fueled demand for CB1-targeting drugs, driving cannabinoid based drug discovery and development market growth.

On the basis of end user, the pharmaceutical companies segment dominated cannabinoid based drug discovery and development market share in 2024. Pharmaceutical companies are actively investing in the development of novel cannabinoid-based therapeutics for a wide range of medical conditions, including chronic pain, epilepsy, multiple sclerosis, and cancer-related symptoms. The increasing acceptance of cannabinoids in mainstream medicine, driven by clinical trials and regulatory approvals, has further incentivized pharmaceutical firms to expand their portfolios. 

On the basis of region, North America accounted for a majority of the cannabinoid based drug discovery and development market share in 2024 and is anticipated to remain dominant during the forecast period. This is attributed to the strong regulatory framework supporting medical cannabis research, high healthcare expenditure, and the presence of key pharmaceutical and biotechnology companies engaged in cannabinoid therapeutics. The region benefits from favorable policies such as the U.S. FDA's approval of cannabinoid-based drugs, increasing clinical trials, and growing acceptance of cannabis-derived medications for conditions like epilepsy, multiple sclerosis, and chronic pain.

However, according to cannabinoid based drug discovery and development market opportunity analysis Asia-Pacific region is anticipated to witness the fastest growth during the forecast period, owing to increasing legalization of medical cannabis, rising awareness about cannabinoid-based therapeutics, and expanding clinical research activities.

Key Findings of the Study

• By receptor target, the CB1 receptor segment was the highest contributor to the market in 2024.
• By end user, the pharmaceutical companies segment was the highest contributor to the market in 2024.
• By region, North America garnered the largest revenue share in 2024. However, Asia-Pacific is expected to grow at the fastest rate during the forecast period.