The global active pharmaceutical ingredients (API) market size reached US$ 234.7 Billion in 2023. Looking forward, the publisher expects the market to reach US$ 357.0 Billion by 2032, exhibiting a growth rate (CAGR) of 4.8% during 2023-2032. The growing prevalence of chronic diseases, such as cancer, diabetes, cardiovascular and neurological disorders, rising demand for biosimilars and generic drugs, and increasing investments in pharmaceutical research and development (R&D) activities represent some of the key factors driving the market.
Active pharmaceutical ingredients (APIs) are used in medications to produce the intended therapeutic effects. They are biologically active substances that directly address disease pathology and manage the symptoms of various medical conditions. They are typically synthesized through a range of complex chemical and biological processes, and their purity, potency, and stability are paramount to their therapeutic effectiveness. They facilitate targeted treatment of diverse medical conditions, enabling drug manufacturers to develop medication specific to diseases and patient groups. They are utilized in various forms like tablets, capsules, ointments, or injectables, each having distinct production requirements. Besides this, they facilitate advancements in drug delivery systems, allowing for more effective and safe distribution of medications in the body.
The rise of the generics market, driven by patent expiries of several drugs and the rising focus on cost-effective treatment options, represents one of the key factors catalyzing the demand for APIs. Moreover, various leading pharmaceutical companies are investing in research and development (R&D) activities to discover and develop innovative drugs and therapeutic methods, which is favoring market growth. Furthermore, due to the high costs and complex processes involved in API production, many pharmaceutical companies are outsourcing their API manufacturing to third-party manufacturers, which is strengthening the market growth. Additionally, the implementation of supportive regulatory policies for drug development and manufacturing is offering a favorable market outlook.
With the constant pursuit of advancements in healthcare, there is a continuous demand for new and improved treatment options. Additionally, innovative APIs play a crucial role in the development of these cutting-edge drugs that target specific diseases and offer enhanced therapeutic benefits. Apart from this, innovative APIs are often protected by patents, providing exclusivity to pharmaceutical companies and enabling them to capitalize on their investments in research and development (R&D). This exclusivity creates a competitive advantage and drives growth of this segment. Furthermore, the increasing focus on personalized medicine and precision therapies further fuels the demand for innovative APIs as they are tailored to specific patient needs.
Captive manufacturers produce APIs exclusively for their own internal use in the production of branded medications. They can ensure a secure and reliable supply chain, which is essential for the consistent manufacturing of their branded pharmaceutical products. Additionally, this approach provides them with greater flexibility in terms of developing and optimizing APIs to suit their specific product portfolio, resulting in enhanced therapeutic outcomes. Apart from this, captive manufacturers often have robust research and development (R&D) capabilities, allowing them to innovate and create new APIs that align with their strategic objectives.
Synthetic APIs are those that are produced through chemical synthesis in the laboratory. The synthetic synthesis process allows for precise control over the molecular structure and composition of the API, ensuring consistency and purity of the final product. This reliability is essential for the development of safe and effective medications. Additionally, synthetic APIs offer a wide range of options in terms of chemical modifications and derivatizations, enabling pharmaceutical companies to optimize the therapeutic properties of the drug. Furthermore, synthetic synthesis methods often offer scalability, allowing for large-scale production to meet the market demand efficiently. Moreover, the scalability of synthetic synthesis methods is another advantage driving the demand for synthetic APIs. Chemical synthesis can often be easily scaled up to meet large-scale production requirements, ensuring a steady and reliable supply of APIs to meet market demands. This scalability is particularly important for medications with high demand or for treating widespread conditions.
The rising incidence of cancer globally is catalyzing the demand for APIs in the oncology segment. This growing prevalence necessitates the development and availability of effective cancer therapies, which heavily rely on APIs for their therapeutic effects. Additionally, the evolving understanding of cancer biology and the emergence of targeted therapies is revolutionizing cancer treatment. Targeted therapies focus on specific molecular targets involved in cancer development and progression. Apart from this, the substantial investment in oncology research and development (R&D) by pharmaceutical companies and the healthcare industry is propelling market growth. Furthermore, the regulatory environment and drug approval processes are becoming more streamlined and expedited for oncology therapies. This is encouraging pharmaceutical companies to invest in the development of oncology APIs and bring new cancer treatments to the market more efficiently.
North America has a well-established and advanced pharmaceutical industry with significant investments in research and development (R&D). This enables the region to lead in the development and production of high-quality APIs. Additionally, North America possesses a robust regulatory framework that ensures adherence to stringent quality standards and safety regulations. This encourages domestic and international buyers regarding the reliability and credibility of APIs originating from the region. Furthermore, the presence of major pharmaceutical companies and API manufacturers in North America is creating a positive market outlook. These companies have extensive capabilities in API production, supply chain management, and distribution networks, solidifying their market position.
In May 2023, Novartis International AG purchased cystinosis gene therapy from AVROBIO Novartis and has acquired an investigational gene therapy program for the treatment of cystinosis, a rare genetic disease, from AVROBIO for $87.5 million. The purchase is aimed at extending Novartis' cash runway and aligns with their platform strategy in Gene & Cell Therapy.
In December 2022, Merck & Co., Inc. collaborated with Antengene to test Keytruda, ATG-037 Combo for solid tumors in phase 1 trial. This collaboration aims to explore the potential benefits of combining targeted therapies and immune-oncology drugs to improve treatment outcomes.
2. What is the expected growth rate of the global Active Pharmaceutical Ingredients (API) market during 2024-2032?
3. What are active ingredients in pharmaceutical industry?
4. What are the key factors driving the global Active Pharmaceutical Ingredients (API) market?
5. What has been the impact of COVID-19 on the global Active Pharmaceutical Ingredients (API) market?
6. What is the breakup of the global Active Pharmaceutical Ingredients (API) market based on the drug type?
7. What is the breakup of the global Active Pharmaceutical Ingredients (API) market based on the type of manufacturer?
8. What is the breakup of the global Active Pharmaceutical Ingredients (API) market based on the type of synthesis?
9. What is the breakup of the global Active Pharmaceutical Ingredients (API) market based on the therapeutic application?
10. What are the key regions in the global Active Pharmaceutical Ingredients (API) market?
11. Who is the biggest API manufacturer?
12. Who are the key players/companies in the global Active Pharmaceutical Ingredients (API) market?
Active pharmaceutical ingredients (APIs) are used in medications to produce the intended therapeutic effects. They are biologically active substances that directly address disease pathology and manage the symptoms of various medical conditions. They are typically synthesized through a range of complex chemical and biological processes, and their purity, potency, and stability are paramount to their therapeutic effectiveness. They facilitate targeted treatment of diverse medical conditions, enabling drug manufacturers to develop medication specific to diseases and patient groups. They are utilized in various forms like tablets, capsules, ointments, or injectables, each having distinct production requirements. Besides this, they facilitate advancements in drug delivery systems, allowing for more effective and safe distribution of medications in the body.
The rise of the generics market, driven by patent expiries of several drugs and the rising focus on cost-effective treatment options, represents one of the key factors catalyzing the demand for APIs. Moreover, various leading pharmaceutical companies are investing in research and development (R&D) activities to discover and develop innovative drugs and therapeutic methods, which is favoring market growth. Furthermore, due to the high costs and complex processes involved in API production, many pharmaceutical companies are outsourcing their API manufacturing to third-party manufacturers, which is strengthening the market growth. Additionally, the implementation of supportive regulatory policies for drug development and manufacturing is offering a favorable market outlook.
Active Pharmaceutical Ingredients (API) Market Trends/Drivers:
Rising prevalence of chronic diseases
Chronic diseases like heart disease, cancer, diabetes, and respiratory disorders are currently affecting a significant percentage of the global population. According to the World Health Organization, chronic diseases are responsible for an estimated 71% of all global deaths. As the number of people affected by these diseases continues to rise, there is an increasing demand for effective pharmaceutical treatments. Both new and improved existing medications, which depend on APIs for their therapeutic effects, are being sought after. Hence, the current global health landscape marked by a high prevalence of chronic diseases is continually driving the demand for high-quality APIs and is stimulating the market growth.Advancements in biotechnology and biopharmaceuticals
The biotechnology sector is currently making significant strides, resulting in major transformations within the pharmaceutical industry. Biopharmaceuticals, often derived from living organisms, are now treating a wide array of diseases more effectively and safely than traditional chemical drugs. APIs synthesized through biotechnological processes, known as biotech APIs, are integral to these biopharmaceuticals. As technological advancements continue to unfold and the adoption of biopharmaceuticals increases, the demand for biotech APIs is concurrently experiencing a surge.Focus on personalized medicine and targeted drug delivery systems
Personalized medicine, which includes tailoring treatment plans to the genetic makeup of an individual, lifestyle, and environment, is currently being emphasized. This approach is shifting the paradigm towards more patient-specific therapies. Similarly, advancements in targeted drug delivery systems aim to improve drug efficacy, reduce side effects, and enhance patient compliance. APIs play a crucial role in both these areas, offering possibilities for various combinations and formulations to achieve the desired therapeutic effects. As these areas continue to evolve and gain traction, they are constantly fueling the growth of the API market.Active Pharmaceutical Ingredients (API) Industry Segmentation:
The publisher provides an analysis of the key trends in each segment of the global active pharmaceutical ingredients (API) market report, along with forecasts at the global, regional and country levels from 2024-2032. The report has categorized the market based on drug type, type of manufacturer, type of synthesis and therapeutic application.Breakup by Drug Type:
- Innovative Active Pharmaceutical Ingredients (API)
- Generic Active Pharmaceutical Ingredients (API)
Innovative active pharmaceutical ingredients (API) dominate the market
The report has provided a detailed breakup and analysis of the market based on the drug type. This includes innovative active pharmaceutical ingredients (API) and generic active pharmaceutical ingredients (API). According to the report, innovative active pharmaceutical ingredients (API) represented the largest segment.With the constant pursuit of advancements in healthcare, there is a continuous demand for new and improved treatment options. Additionally, innovative APIs play a crucial role in the development of these cutting-edge drugs that target specific diseases and offer enhanced therapeutic benefits. Apart from this, innovative APIs are often protected by patents, providing exclusivity to pharmaceutical companies and enabling them to capitalize on their investments in research and development (R&D). This exclusivity creates a competitive advantage and drives growth of this segment. Furthermore, the increasing focus on personalized medicine and precision therapies further fuels the demand for innovative APIs as they are tailored to specific patient needs.
Breakup by Type of Manufacturer:
- Captive Manufacturers
- Merchant API Manufacturers
- Innovative Merchant API Manufacturers
- Generic Merchant API Manufacturers
Captive manufacturers hold the largest share in the market
A detailed breakup and analysis of the market based on the type of manufacturer has also been provided in the report. This includes captive manufacturers and merchant API manufacturers (innovative merchant API manufacturers and generic merchant API manufacturers). According to the report, captive manufacturers accounted for the largest market share.Captive manufacturers produce APIs exclusively for their own internal use in the production of branded medications. They can ensure a secure and reliable supply chain, which is essential for the consistent manufacturing of their branded pharmaceutical products. Additionally, this approach provides them with greater flexibility in terms of developing and optimizing APIs to suit their specific product portfolio, resulting in enhanced therapeutic outcomes. Apart from this, captive manufacturers often have robust research and development (R&D) capabilities, allowing them to innovate and create new APIs that align with their strategic objectives.
Breakup by Type of Synthesis:
- Synthetic Active Pharmaceutical Ingredients (API)
- Market Breakup by Type
- Innovative Synthetic APIs
- Generic Synthetic APIs
- Biotech Active Pharmaceutical Ingredients (API)
- Market Breakup by Type
- Innovative Biotech APIs
- Biosimilars
- Market Breakup By Product
- Monoclonal Antibodies
- Vaccines
- Cytokines
- Fusion Proteins
- Therapeutic Enzymes
- Blood Factors
- Market Breakup By Expression System
- Mammalian Expression Systems
- Microbial Expression Systems
- Yeast Expression Systems
- Transgenic Animal Systems
- Others
Synthetic API accounted for the largest market share
A detailed breakup and analysis of the market based on the type of synthesis has also been provided in the report. This includes Synthetic Active Pharmaceutical Ingredients (API) [Market Breakup By Type {Innovative Synthetic APIs and Generic Synthetic APIs}]; and Biotech Active Pharmaceutical Ingredients (API) [Market Breakup By Type {Innovative Biotech APIs and Biosimilars}, Market Breakup By Product {Monoclonal Antibodies, Vaccines, Cytokines, Fusion Proteins, Therapeutic Enzymes, and Blood Factors}, and Market Breakup By Expression System {Mammalian Expression Systems, Microbial Expression Systems, Yeast Expression Systems, Transgenic Animal Systems and Others}]. According to the report, synthetic active pharmaceutical ingredients (API) accounted for the largest market share.Synthetic APIs are those that are produced through chemical synthesis in the laboratory. The synthetic synthesis process allows for precise control over the molecular structure and composition of the API, ensuring consistency and purity of the final product. This reliability is essential for the development of safe and effective medications. Additionally, synthetic APIs offer a wide range of options in terms of chemical modifications and derivatizations, enabling pharmaceutical companies to optimize the therapeutic properties of the drug. Furthermore, synthetic synthesis methods often offer scalability, allowing for large-scale production to meet the market demand efficiently. Moreover, the scalability of synthetic synthesis methods is another advantage driving the demand for synthetic APIs. Chemical synthesis can often be easily scaled up to meet large-scale production requirements, ensuring a steady and reliable supply of APIs to meet market demands. This scalability is particularly important for medications with high demand or for treating widespread conditions.
Breakup by Therapeutic Application:
- Oncology
- Cardiovascular and Respiratory
- Diabetes
- Central Nervous System Disorders
- Neurological Disorders
- Others
Oncology holds the largest market share
Based on the therapeutic application, the market has been segmented as oncology, cardiovascular & respiratory, diabetes, central nervous system disorders, neurological disorders, and others. According to the report, oncology accounted for the largest market share.The rising incidence of cancer globally is catalyzing the demand for APIs in the oncology segment. This growing prevalence necessitates the development and availability of effective cancer therapies, which heavily rely on APIs for their therapeutic effects. Additionally, the evolving understanding of cancer biology and the emergence of targeted therapies is revolutionizing cancer treatment. Targeted therapies focus on specific molecular targets involved in cancer development and progression. Apart from this, the substantial investment in oncology research and development (R&D) by pharmaceutical companies and the healthcare industry is propelling market growth. Furthermore, the regulatory environment and drug approval processes are becoming more streamlined and expedited for oncology therapies. This is encouraging pharmaceutical companies to invest in the development of oncology APIs and bring new cancer treatments to the market more efficiently.
Breakup by Region:
- North America
- United States
- Canada
- Europe
- Germany
- France
- United Kingdom
- Italy
- Spain
- Russia
- Others
- Asia Pacific
- China
- Japan
- India
- South Korea
- Australia
- Indonesia
- Others
- Latin America
- Middle East and Africa
North America exhibits a clear dominance, accounting for the largest active pharmaceutical ingredients (API) market share
The report has also provided a comprehensive analysis of all the major regional markets, which include North America (the United States and Canada); Europe (Germany, France, the United Kingdom, Italy, Spain, Russia, and others); Asia Pacific (China, Japan, India, South Korea, Australia, Indonesia, and others); Latin America; and the Middle East and Africa. According to the report, North America accounted for the largest market share.North America has a well-established and advanced pharmaceutical industry with significant investments in research and development (R&D). This enables the region to lead in the development and production of high-quality APIs. Additionally, North America possesses a robust regulatory framework that ensures adherence to stringent quality standards and safety regulations. This encourages domestic and international buyers regarding the reliability and credibility of APIs originating from the region. Furthermore, the presence of major pharmaceutical companies and API manufacturers in North America is creating a positive market outlook. These companies have extensive capabilities in API production, supply chain management, and distribution networks, solidifying their market position.
Competitive Landscape:
Leading companies are currently prioritizing various strategies to strengthen their market presence. They are actively investing in R&D to explore innovative APIs, particularly in the field of biotechnology and precision medicine. To meet the increasing demand, these companies are continuously expanding their production capacities and adopting advanced manufacturing processes. They are also entering strategic collaborations and partnerships to optimize their supply chain and enhance their global footprint. Furthermore, they are progressively addressing environmental concerns by promoting sustainable practices in their operations. In the face of evolving health challenges, these companies are persistently adapting to cater to the changing needs of the global patient population, making a significant impact on the health sector.The report has provided a comprehensive analysis of the competitive landscape in the market. Detailed profiles of all major companies have also been provided. Some of the key players in the market include:
- Pfizer, Inc
- Novartis International AG
- Sanofi
- Boehringer Ingelheim
- Bristol-Myers Squibb
- Teva Pharmaceutical Industries Ltd
- ELI Lilly and Company
- GlaxoSmithKline
- Merck & Co., Inc
- Abbvie Inc
Recent Developments:
In June 2023, Pfizer Inc. invested $25 million in a biopharma company Caribou Biosciences to support the development of an immune-cloaked allogeneic CAR-T cell therapy.In May 2023, Novartis International AG purchased cystinosis gene therapy from AVROBIO Novartis and has acquired an investigational gene therapy program for the treatment of cystinosis, a rare genetic disease, from AVROBIO for $87.5 million. The purchase is aimed at extending Novartis' cash runway and aligns with their platform strategy in Gene & Cell Therapy.
In December 2022, Merck & Co., Inc. collaborated with Antengene to test Keytruda, ATG-037 Combo for solid tumors in phase 1 trial. This collaboration aims to explore the potential benefits of combining targeted therapies and immune-oncology drugs to improve treatment outcomes.
Key Questions Answered in This Report
1. How big is the active pharmaceutical ingredient market?2. What is the expected growth rate of the global Active Pharmaceutical Ingredients (API) market during 2024-2032?
3. What are active ingredients in pharmaceutical industry?
4. What are the key factors driving the global Active Pharmaceutical Ingredients (API) market?
5. What has been the impact of COVID-19 on the global Active Pharmaceutical Ingredients (API) market?
6. What is the breakup of the global Active Pharmaceutical Ingredients (API) market based on the drug type?
7. What is the breakup of the global Active Pharmaceutical Ingredients (API) market based on the type of manufacturer?
8. What is the breakup of the global Active Pharmaceutical Ingredients (API) market based on the type of synthesis?
9. What is the breakup of the global Active Pharmaceutical Ingredients (API) market based on the therapeutic application?
10. What are the key regions in the global Active Pharmaceutical Ingredients (API) market?
11. Who is the biggest API manufacturer?
12. Who are the key players/companies in the global Active Pharmaceutical Ingredients (API) market?
Table of Contents
1 Preface3 Executive Summary
2 Scope and Methodology
4 Introduction
5 Global Active Pharmaceutical Ingredients (API) Market
6 Market Breakup by Drug Type
7 Market Breakup by Type of Manufacturer
8 Market Breakup by Type of Synthesis
9 Market Breakup by Therapeutic Application
10 Market Breakup by Region
11 API Manufacturing Process
12 Competitive Landscape
List of Figures
List of Tables
Companies Mentioned
- Pfizer Inc.
- Novartis International AG
- Sanofi
- Boehringer Ingelheim
- Bristol-Myers Squibb
- Teva Pharmaceutical Industries Ltd.
- ELI Lilly and Company
- GlaxoSmithKline
- Merck & Co. Inc.
- Abbvie Inc
Methodology
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