Small Molecule API Market Report 2025

The small molecule api market size has grown strongly in recent years. It will grow from $204.47 billion in 2024 to $218.35 billion in 2025 at a compound annual growth rate (CAGR) of 6.8%. The growth in the historic period can be attributed to rise of generic drug manufacturing, increased R&D investment, aging population demands, expansion in oncology treatments, emergence of targeted therapies.

The small molecule api market size is expected to see strong growth in the next few years. It will grow to $296.47 billion in 2029 at a compound annual growth rate (CAGR) of 7.9%. The growth in the forecast period can be attributed to supply chain resilience, digitalization in pharmaceutical manufacturing, increasing investment in oncology, adoption of green chemistry, pandemic-driven healthcare needs. Major trends in the forecast period include biopharmaceutical synergy, personalized medicine, advanced manufacturing techniques, API outsourcing and contract manufacturing.

The increasing demand for small-molecule drugs is anticipated to drive the growth of the small-molecule API market. Small-molecule drugs are low-molecular-weight compounds that can influence biochemical processes to diagnose, treat, or prevent diseases. Examples of small-molecule drugs include aspirin and diphenhydramine, which are commonly found in medicine cabinets. These drug products fall under the category of small-molecule API products, contributing to disease prevention. For instance, a report from December 2023 by the Office of the Assistant Secretary for Planning and Evaluation, a U.S. government department, indicated that in 2022, small-molecule drugs produced by a single manufacturer accounted for 43% of the total small-molecule drug market but represented 65% of the overall expenditures in that market. Thus, the rising demand for small-molecule drugs is propelling the growth of the small-molecule API market.

The rising prevalence of chronic diseases is projected to drive the growth of the small molecules API market in the coming years. Chronic diseases refer to illnesses that persist for three months or longer and can worsen over time. Conditions such as cardiovascular diseases, diabetes, and cancer require ongoing medication, resulting in a consistent demand for pharmaceutical treatments. Small molecules APIs are essential in formulating drugs that offer optimized bioavailability, improved pharmacokinetics, and minimized side effects, enhancing the overall effectiveness and patient acceptability of long-term treatment plans for chronic illnesses. For example, in January 2023, the National Center for Biotechnology Information (NCBI), a US-based National Library of Medicine, reported that the number of people with chronic diseases worldwide is expected to reach 142.66 million by 2050, up from 71.522 million in 2022. Therefore, the increasing prevalence of chronic diseases is fueling the growth of the small molecule API market.

A notable trend in the small-molecule API market is the emphasis on strategic partnerships. Many companies in the market are actively engaging in partnerships to strengthen their market positions and advance the development of drugs and therapies. For instance, in March 2023, CatSci Ltd., a UK-based pharmaceutical company, partnered with AGC Pharma Chemicals, a Spain-based pharmaceutical company, to enhance drug development. This collaboration leverages CatSci's non-clinical expertise with AGC's manufacturing capabilities, particularly supporting clinical phase projects. The partnership aims to provide strategic value, expedite drug development timelines, and deliver impactful small-molecule API-based medicines globally. This trend underscores the significance of collaborative efforts in driving innovation and growth within the small-molecule API market.

Major companies in the small molecules API market are actively developing new technologies to address solubility challenges, particularly for oral small molecules. In March 2022, Evonik Industries AG, a leading Germany-based specialty chemicals company, introduced EUDRATEC SoluFlow. This microparticle technology is specifically designed to enhance the solubility of active pharmaceutical ingredients (APIs) in oral drugs. EUDRATEC SoluFlow employs an emulsion-based process to overcome solubility challenges for over 70% of new small molecules. The technology facilitates the development of oral therapeutics in critical medical areas by transforming poorly soluble drugs into easily processed amorphous solid dispersions (ASD). Notably, this innovation reduces post-processing complexity, offering a significant advancement in addressing solubility issues for oral small molecules.

In a strategic move, GHO Capital, a European specialist investor in healthcare companies, made a noteworthy acquisition in March 2022 by securing a majority stake in Sterling Pharma Solutions. This acquisition positions GHO Capital to leverage extensive pharmaceutical expertise in Europe and expand its market presence in the United States. Sterling Pharma Solutions, a US-based manufacturer specializing in active pharmaceutical ingredients (APIs), aligns with GHO Capital's strategic objectives in the healthcare sector. This move underscores the significance of strategic investments and partnerships in driving growth and innovation within the small molecules API market.

Major companies operating in the small molecule api market are Merck & Co. Inc., AbbVie Inc., Bristol-Myers Squibb Company, Boehringer Ingelheim International GmbH, Dr. Reddy's Laboratories Ltd., Aurobindo Pharma, Sun Pharmaceutical Industries Ltd., Teva Pharmaceutical Industries Ltd., Viatris Inc., Cambrex Corporation, Lonza Group AG, Siegfried Holding AG, AstraZeneca, F. Hoffmann-La Roche AG, Nanjing King-friend Biochemical Pharmaceutical Co. Ltd, Albany Molecular Research Inc., BASF SE, Gilead Sciences Inc., GlaxoSmithKline PLC, Johnson Matthey PLC, Novartis AG.

North America was the largest region in the small molecule API market in 2024. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the small molecule api market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the small molecule api market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Small molecules API (active pharmaceutical ingredients) are organic compounds characterized by their low molecular weight, typically less than 1 nanometer and comprised of 20-100 atoms. These active ingredients play a pivotal role in various biological and pharmaceutical processes, serving as fundamental components. Small molecules APIs find extensive applications in both pharmaceutical and biological procedures, aiding in the exploration of biological functions and contributing to the development of novel therapeutic agents.

The primary categories of small molecule APIs encompass synthetic and biotech variations. Synthetic small molecule APIs are created within laboratory settings through diverse chemical processes. Manufacturing of these small molecule APIs can occur in-house or through outsourced means, catering to multiple applications such as cardiology, oncology, CNS and neurology, orthopaedics, endocrinology, and various other medical fields.

The small molecule API market research report is one of a series of new reports that provides small molecule API market statistics, including small molecule API industry global market size, regional shares, competitors with a small molecule API market share, detailed small molecule API market segments, market trends and opportunities, and any further data you may need to thrive in the small molecule API industry. This small molecule API market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The small molecules API market consists of sales of contract and captive small molecules API. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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