Active Pharmaceutical Ingredients Market

The global Active Pharmaceutical Ingredients Market is valued at USD 141.3 Billion in 2022 and is projected to reach a value of USD 262.54 Billion by 2030 at a CAGR (Compound Annual Growth Rate) of 8.09% between 2023 and 2030.

Premium Insights

The demand for Active Pharmaceutical Ingredients is increasing worldwide due to the rising prevalence and impact of chronic diseases, infectious diseases, and genetic disorders. This can be attributed to the need for effective and safe drugs. For instance, according to statistics published in 2022 by the International Diabetes Federation (IDF), there were approximately 537 million people living with diabetes globally in 2022. This number is estimated to increase to 643 million by 2030 and 783 million by 2045. Consequently, diabetes-related high blood sugar can harm the nerves responsible for heart and blood vessel control, resulting in various cardiovascular diseases like coronary artery disease and stroke. These conditions often require drug treatment, thus driving the growth of the API market.

• The market growth is expected to be driven by government initiatives that focus on increasing production of active pharmaceutical ingredients (APIs). For instance, the Indian government announced in March 2022 the initiation of the production of 35 crucial APIs as part of a production-linked scheme for the pharmaceutical sector. The production of these APIs is spread across 32 different plants in India, indicating a noteworthy step towards reducing import reliance and improving domestic production capabilities.
• North America generated more than 38.5% of revenue share in 2022
• Asia Pacific is expected to grow at the quickest rate from 2023 to 2030
• Synthetic APIs segment accounted for the largest market growth. It contributed over 70.9% of the total revenue share in 2022
• Captive APIs segment revealed the most significant market growth, contributing more than 51.2% of the total revenue share in 2022
• Innovative Drug will account for largest market share in 2022
• Prescription Drugs will dominate the market in 2022 with market share of 57.8%
• Cardiovascular Diseases segment will account for market share of 20.8% in 2022

Economic Insights

The economic dynamics of the market are shaped by a combination of factors, contributing to its growth and impact on the pharmaceutical sector. The market expansion due to the increasing prevalence of chronic diseases worldwide, which drives demand for pharmaceuticals and, consequently, APIs. Additionally, the focus on developing innovative drugs through increased investments in research and development (R&D) necessitates the development of new and advanced APIs. Regulatory compliance, particularly adherence to strict quality standards, is a vital aspect of the API market's economic resilience. Furthermore, financial incentives provided by governments in different countries to support API manufacturing highlight the economic attractiveness of this sector and its crucial role within the broader pharmaceutical industry.

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Top Market Trends

• Increasing prevalence of chronic diseases: The demand for APIs used in the treatment of various disorders is being driven by the increased prevalence of chronic diseases such cancer, cardiovascular diseases, and diabetes.
• Growing demand for generic drugs: Generic medications are more affordable than branded ones and are also become easier to find. The need for APIs utilized in the production of generic medications.
• Rising demand for biologics and specialty drugs: The treatment of complex disorders is increasingly dependent on biologics and speciality medications. Due to the complexity of these drugs' API requirements, the API business is expanding.
• Technological advancements in API manufacturing: The effectiveness and quality of API production are being enhanced by technological developments in the industry. As a result, APIs are becoming more affordable and available to patients.

Market Segmentation

The globel Active Pharmaceutical Ingredients market can be categorized into Type of Synthesis , Type of Manufacturer, Type , Type of Drug, Application, Region. The Market can be categorized into Biotech , Synthetic based on Type of Synthesis . The Market can be categorized into Captive Manufacturers, Merchant Manufacturers based on Type of Manufacturer. The Market can be categorized into Generic APIs, Innovative APIs based on Type . The Market can be categorized into Prescription Drugs, Over-the-counter Drugs based on Type of Drug. The Market can be categorized into Cardiovascular Diseases, Oncology, CNS and Neurology, Orthopedic, Endocrinology, Pulmonology, Gastroenterology, Nephrology, Ophthalmology, Others based on Application. The Market can be categorized into North America, Europe, Asia Pacific, Latin America, Middle East & Africa based on Region.

Based on Type of Synthesis

Synthetic holds the largest share

The synthetic active pharmaceutical ingredients (APIs) segment is expected to dominate the market because of their production benefits from accessible and cost-effective raw materials derived from petrochemical feedstocks. This availability contributes to a more stable and dependable supply chain for synthetic APIs. Additionally, the chemical processes used in their synthesis are well-established, making manufacturing more efficient and streamlined. Synthetic API production can be scaled up easily, allowing for large-scale manufacturing and reducing overall production costs.

Based on Type of Manufacturer

Captive APIs will dominate the market during Forecast Period

The captive active pharmaceutical ingredients (APIs) is expected to dominate the market. These APIs are exclusively produced by pharmaceutical companies for their own use, giving them more control over supply chains and quality standards while reducing reliance on external suppliers, which is especially advantageous during disruptions in supply. The growth of the captive API market is driven by the increasing demand for complex APIs used in newly developed drugs. Pharmaceutical companies are increasingly choosing to produce these complicated molecules internally to ensure scalability and maintain high-quality standards.

Based on Type

Innovative API will lead the market

Innovative API are expected to maintain their dominance in the market. The increasing demand for innovative APIs is driven by the worldwide rise in chronic illnesses like cancer, cardiovascular disease, and diabetes, which necessitates the development of new and advanced medications. Moreover, significant technological advancements in drug discovery and development, specifically in gene editing and therapy, have shaped the industry by producing APIs that target diseases at the genetic level.

Based on Type of Drug

Prescription Drugs will account for largest share

Prescription drugs are expected to dominate the market due their widespread use in treating various diseases, especially the growing prevalence of chronic conditions like cancer, cardiovascular disease, and diabetes globally. Prescription drugs have more complex APIs compared to over-the-counter drugs because they are designed to address more serious and complicated health issues. This complexity in manufacturing aligns with the rising need for pharmaceutical solutions for severe medical conditions.

Based on Application

Cardiovascular Diseases will account for largest share

cardiovascular diseases (CVDs) are expected to dominate the market. The growth of the CVD API market is driven by the increasing prevalence of CVDs worldwide due to aging populations, unhealthy lifestyles, and urbanization. The rising demand for CVD treatments, resulting from the growing prevalence of CVDs, is a significant driver for the need of CVD APIs. Moreover, the continuous development of new and innovative CVD treatments also contributes to the growth of this market, often requiring the creation of specialized APIs to address the changing landscape of cardiovascular health.

Based on Region

North America will lead the market

North America lead the market because the region has a high prevalence of chronic diseases such as cancer, cardiovascular disease, and diabetes, which leads to a strong demand for APIs that are crucial in the development of drugs to combat these health conditions. Moreover, the growing trend of personalized medicine in healthcare is also contributing to an increased need for APIs that are specifically tailored to individual genetic characteristics and other relevant factors. The significant investments made by North American pharmaceutical companies in research and development (R&D) play a crucial role in creating innovative and novel drugs, thus driving the demand for advanced APIs.

Competitive Landscape

The market is highly competitive with intense activity and innovation. The market for is characterized by competition influenced by various factors such as technological advancements, adherence to regulations, and strategic partnerships. Having a global presence is advantageous as it allows companies to diversify their supply chains and meet the demands of different markets. Research and development are crucial, with companies focusing on innovating manufacturing processes and developing new APIs. Adhering to strict quality standards gives companies a competitive advantage. Collaborations between pharmaceutical firms and contract manufacturing organizations are common, as they enable sharing of resources and improve operational efficiency.

The players in the global market include Pfizer Inc. (US), Novartis International AG (Switzerland), Sanofi (France), Boehringer Ingelheim (Germany), Bristol-Myers Squibb (US), Teva Pharmaceutical Industries Ltd. (Israel), Eli Lilly and Company (US), GlaxoSmithKline plc (UK), Merck & Co. Inc. (US), AbbVie Inc. (US), F. Hoffmann-La Roche Ltd. (Switzerland), AstraZeneca (UK), Cipla Inc. (India), Mylan N.V. (US), Dr. Reddy’s Laboratories Ltd. (India), Sun Pharmaceutical Industries Ltd. (India), API Pharma Tech (India), BDR Pharmaceuticals Internationals Pvt. Ltd. (India), Sreepathi Pharmaceuticals Limited (India), Shilpa Medicare Limited (India) among others.

Recent Market Developments

• 2022: An agreement was signed between Pfizer and Acuitas to provide a lipid nanoparticle delivery system for the administration of mRNA vaccines and treatments like COMIRNATY ((tozinameran).
• 2022: Sanofi and IGM have entered into a strategic collaboration agreement aimed at enhancing the development and commercialization process of IgM antibody agonists for various targets including oncology, immunology, and inflammation.
• 2022: Boehringer Ingelheim joined forces with Mabgenesis in a collaboration aimed at creating innovative monoclonal antibodies to aid in therapeutic treatment.

Segmentation of the Global Market