Active Pharmaceutical Ingredients Global Market Report 2024

The global active pharmaceutical ingredients market has grown strongly in recent years. It will grow from $218.45 billion in 2023 to $233.55 billion in 2024 at a compound annual growth rate (CAGR) of 6.9%. The historical growth in the active pharmaceutical ingredient (API) market can be attributed to several factors. This includes advancements in drug development, the expansion of the generic drug market, the globalization of pharmaceutical manufacturing, regulatory initiatives aimed at ensuring drug safety, the increased prominence of contract manufacturing organizations (CMOs), a focus on precision medicine, the emergence of biopharmaceuticals, and the impact of global pandemics and health threats. These factors collectively contributed to the development and evolution of the API industry during the historical period.

The global active pharmaceutical ingredients market is expected to see strong growth in the next few years. It will grow to $305.2 billion in 2028 at a compound annual growth rate (CAGR) of 6.9%. The anticipated growth in the forecast period for the active pharmaceutical ingredient (API) market can be attributed to various factors. These include the continuous increase in healthcare expenditure, a growing emphasis on rare diseases, the expansion of the biosimilars market, advancements in green chemistry practices, a focus on continuous manufacturing processes, regulatory support for innovation, the globalization of clinical trials, and an increased emphasis on sustainable and ethical practices. Major trends expected in the forecast period include the digitalization of drug development processes, investments in advanced manufacturing technologies, the production of APIs for rare diseases and orphan drugs, heightened regulatory scrutiny on quality, API serialization and traceability, and the continued growth of biopharmaceuticals and biotechnology products.

The expanding prevalence of chronic diseases is anticipated to be a driving factor for the growth of the active pharmaceutical ingredients (API) market. Chronic diseases, persisting for three months or more and often worsening over time, encompass conditions like cancer, heart disease, stroke, diabetes, and arthritis. APIs are integral to high-quality medications addressing various illnesses such as oncology, cardiology, neurology, and orthopedics. For instance, the International Diabetes Federation predicts a significant rise in diabetes cases to 578 million by 2030 and 700 million by 2045, with nearly half of diabetes-related deaths occurring in adults under 60, making it a top 10 cause of mortality. Hence, the escalating incidence of chronic diseases is expected to propel growth in the API market.

The escalating investment in research and development (R&D) is poised to drive the growth trajectory of the active pharmaceutical ingredients market. R&D investment involves allocating resources - financial, human, and technological - toward activities that generate new knowledge, innovate products, services, or processes, and enhance existing offerings. This investment significantly influences API development by fostering innovation, elevating product quality, and propelling advancements in the pharmaceutical sector. Entities like biopharmaceutical companies and government agencies channel resources into R&D to create innovative APIs and formulations, aiming to improve treatment outcomes and address unmet medical needs. Notably, in September 2023, the National Center for Science and Engineering Statistics reported a 13.6% increase in federal agency commitments for R&D in FY 2021, reaching an all-time high of $190.2 billion. Therefore, the escalating investment in R&D is a key driver for the active pharmaceutical ingredients market.

Technological advancements represent a pivotal trend gaining traction within the active pharmaceutical ingredients market. Leading market players are directing efforts toward implementing innovative technologies and methods for optimized API production. Techniques like continuous flow chemistry, advancements in lyophilization, powder handling, and process control are focal points for major companies aiming to maintain their market standing. A notable example involves the collaboration between NovAliX, ALYSOPHIL SAS, De Dietrich Process Systems, and Bruker in May 2022. This partnership introduced a groundbreaking approach to API production through the PIPAc (Production Intelligente de Principes Actifs) project. PIPAc aims to revolutionize API manufacturing by minimizing complex supply chains in pharmaceutical production and developing rapid-response mobile API production units for global deployment. Leveraging cutting-edge synthesis, continuous flow chemistry, in-flow analysis, and artificial intelligence, PIPAc seeks to create next-generation, autonomous, and optimized units.

Leading firms within the active pharmaceutical ingredients (API) sector are concentrating on the introduction of pioneering solutions, like Capsugel Enprotect, aimed at driving their market revenues. An innovative API solution represents an advanced pharmaceutical compound serving as the biologically active element in drug products. For example, in November 2022, Lonza Group AG unveiled Capsugel Enprotect, a groundbreaking capsule solution designed to transport acid-sensitive active pharmaceutical ingredients to the intestine. This coating-free capsule, a first of its kind, expedites drug development timelines by simplifying the manufacturing process, as it remains intact during stomach transit and releases its contents solely in the intestine. This innovative delivery method is tailored for use with small molecules, proteins, peptides, RNA-based medicines, and even aids in delivering living biotherapeutic products - an innovative class of medical interventions.

In June 2021, Aceto, a US-based supplier specializing in health sciences and high-tech markets, acquired Cascade Chemistry for an undisclosed sum. This strategic acquisition is anticipated to enhance Aceto's ability to support clients across the drug development continuum and grant easier access to expanded North American manufacturing capabilities, particularly concerning APIs and advanced intermediates. Cascade Chemistry, a US-based contract development and manufacturing organization (CDMO) renowned for manufacturing active pharmaceutical ingredients, aligns with Aceto's vision for growth and market diversification.

Major companies operating in the active pharmaceutical ingredients market report are Albemarle Corporation, Aurobindo Pharma Limited, Dr. Reddy's Laboratories Limited, AbbVie Inc., Teva Pharmaceutical Industries Limited, Cipla Limited, Boehringer Ingelheim International GmbH, Merck KGaA, Sun Pharmaceutical Industries Limited, Bristol-Myers Squibb Company, Mylan Pharmaceuticals ULC, BASF Corporation, Lupin Limited, Johnson & Johnson Services Inc., F. Hoffmann-La Roche AG, Pfizer Inc., Novartis International AG, Sanofi S.A, Viatris Inc., Cadila Pharmaceuticals Limited, Amneal Pharmaceuticals Inc., Apotex Inc., Sun Pharmaceutical Industries Ltd., Lonza Group AG, HPM Chemicals and Fertilizers Ltd., GlaxoSmithKline plc, Godrej Consumer Products, Roche Holding AG, Daiichi Sankyo Inc., Catalent Inc.

North America was the largest region in the active pharmaceutical ingredients market share in 2023. The regions covered in the active pharmaceutical ingredients market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the active pharmaceutical ingredients market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

There are two main types of active pharmaceutical ingredients such as innovative APIs and generic APIs. Innovative APIs are associated with drugs containing active ingredients or combinations that have not been previously approved. These are often used to offer unique treatments for conditions lacking effective existing remedies. Manufacturers of APIs can be categorized as captive manufacturers and merchant manufacturers. The synthesis types of APIs include synthetic APIs and biotech APIs. These ingredients find applications in both prescription and over-the-counter drugs, targeting therapeutic areas such as communicable diseases, oncology, diabetes, cardiovascular disease, pain management, respiratory diseases, and others.

This report provides active pharmaceutical ingredients market statistics, including active pharmaceutical ingredients industry global market size, regional shares, competitors with an active pharmaceutical ingredients market share, detailed active pharmaceutical ingredients market segments, market trends and opportunities, and any further data you may need to thrive in the active pharmaceutical ingredients industry. These active pharmaceutical ingredients 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 active pharmaceutical ingredient market consists of sales of active pharmaceutical ingredients that are used in final pharmaceutical products such as drug products (tablet, pill, cream, or injectable) to deliver a desired effect. 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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