Active Pharmaceutical Ingredients Market - By Therapeutic Category (Oncology, Infectious Diseases, Anti-Diabetics, CNS & Anesthesia), By Synthesis (Chemical Based API, Biological API, HPAPI), By Contract Outsourcing, By Application, By Drug & Forecast, 2023-2032

Active Pharmaceutical Ingredients Market Size

Active Pharmaceutical Ingredients Market size was valued at over USD 228.5 billion in 2022. Driven by the increasing prevalence of chronic diseases, the industry is estimated to expand at more than 6.5% CAGR from 2023 to 2032.
 

Increasing uptake of biopharmaceuticals is anticipated to fuel active pharmaceutical ingredients market progress. The popularity of biopharmaceuticals due to their ability of addressing previously incurable disorders has provided lucrative opportunities for new medications and R&D initiatives focusing on rare diseases. For instance, in 2022, Bluebird Bio, Inc. received FDA approval for its SKYSONA (elivaldogene autotemcel), dedicated to deaccelerating the progression of neurologic dysfunction with individuals suffering from cerebral adrenoleukodystrophy (CALD).
 

Furthermore, rising drug R&D initiatives by public and private players, fueled by growing government investments, are also benefitting the industry outlook. In June 2022, Evonik, specialty chemicals firm, together with the U.S. government, invested over USD 220 million in extending lipid production capacity for mRNA-based therapies in the country.
 

Dynamic pricing policies may restrain industry progression

Unfavorable drug price control policies is a major factor restraining the market development. These policies may appear to be cutting costs and improving access to medications and biopharmaceuticals, but they impact drug producers by slowing both their top and bottom-line growth. Nonetheless, in the coming years, consistent efforts by price regulators are speculated to support in overcoming this issue. Citing an instance, the National Pharmaceutical Pricing Authority of India allowed a 50% price hike for three drugs due to the high prices of APIs in them.
 

Active Pharmaceutical Ingredients Market Analysis

In terms of therapeutic category, the active pharmaceutical ingredients market is categorized into cardiovascular diseases, biologics, oncology, anti-diabetics, infectious diseases, CNS & anesthesia, and others. The oncology segment held 27% market share in 2022 and is likely to progress at 7.5% CAGR from 2023 to 2032. The increased occurrence of cancer and advancements in medical diagnostics, therapies, and medications created with cutting-edge active pharmaceutical ingredients are fueling the use of APIs for oncology. Novel advancements in the space are as well influencing the segment trends.
 

With respect to synthesis, the active pharmaceutical ingredients market is divided into chemical-based API, biological API, and highly potent API (HPAPI). The HPAPI segment is poised to depict 5.5% CAGR between 2023 and 2032. The high tolerability of HPAPI make them highly preferrable for oral formulations and increasing the life expectancy of cancer patients. Some CMOs are also making continuous investments in large-scale production capacity in countries including India due to the continuing trend of highly potent APIs for drugs.
 

Based on contract outsourcing, the active pharmaceutical ingredients market is classified into CDMO and CMO. The CMO (contract manufacturing organization) segment is slated to garner more than USD 263.5 billion revenue by 2032. The growing involvement of international authorities in outsourcing the pharmaceutical production process is accelerating the segment growth. In October 2022, Outsourcing Facilities Association (OFA) inked a settlement agreement with U.S. FDA to accelerate the review of long-pending API contracts for outsourcing facilities for bulk production.
 

From drug point of view, the API market is bifurcated into prescription and OTC. The prescription segment is projected to expand at over 7% CAGR from 2023 to 2032. This is attributed to the growing demand for telehealth and E-prescription API platforms for chronic diseases such as oncology, diabetes, and cardiovascular diseases among others that require a prescription for availing the drug. Rising launch of novel platforms would support the market expansion.
 

In terms of application, the active pharmaceutical ingredients market is segregated into humans and veterinary. The API industry size from human segment is expected to cross USD 381 billion by 2032. The rising number of pharmaceutical R&D initiatives is primed to drive the production of APIs for humans. For instance, in October 2021, Cortex Innovation, a leading key player, unveiled its new API R&D center to improve its drug portfolio in the U.S. Moreover, the development of novel medications that address unmet medical needs is also benefitting research-based pharmaceutical and biotechnology companies.
 

Europe active pharmaceutical ingredients market is foreseen to reach over USD 119.5 billion by 2032. The growing trend of new high-tech therapies, development of novel and inventive delivery systems, and the evolution of personalized medications are all contributing to the burgeoning penetration of API manufacturers in the region. For instance, in January 2021, Sanofi, an active pharmaceutical ingredients manufacturer, unveiled EuroAPI, a European standalone API company, to support the rising regional market demand.
 

Active Pharmaceutical Ingredients Market Share

• Pfizer Inc.
• Merck & Co. Inc.
• OfiChem Group
• Biocon Ltd.
• Divi's Laboratories Limited
• Procyon Life Sciences
• EUROAPI
• Teva Pharmaceutical Industries Ltd.
• Alivira Animal Health Ltd
• Cipla Ltd.
• Aurobindo pharma Ltd.
• Dr. Reddys Laboratories Ltd.
• Sun Pharmaceutical Industries Ltd.
• Neuland Laboratories Ltd
• Solara Active Pharma
• Hikal Ltd.
• SUANFARMA
• Qilu Pharmaceutical Co. Ltd
• NGL Fine-Chem Ltd
• Aarti Drugs Ltd.

are some of the key participants in the active pharmaceutical ingredients market.
 

These firms are focusing on strategic collaborations and R&D programs to remain ahead in the competitive landscape. For instance, in July 2022, Merck & Co. Inc., an American pharmaceutical company, announced a collaboration deal with Orion, to develop and commercialize ODM-208 active pharmaceutical ingredient and other drugs targeting cytochrome P450 11A1 (CYP11A1) globally. This strategic alliance helped the company in expanding its product portfolio and global presence.
 

Impact of COVID-19 Pandemic

The COVID-19 pandemic has had a negative impact on the API industry due to labor shortages, supply chain disruptions, and a lack of raw materials and packaging sources. However, the strong emphasis of governments from across the world on domestic drug production and reducing dependency on exported APIs has proliferated the demand for a variety of pharmaceuticals in the post-pandemic scenario.
 

For instance, in September 2022, Biden Administration inked an executive order to introduce National Biotechnology and Biomanufacturing Initiative. Under this initiative, the U.S. Department of Health and Human Services (HHS) will invest approximately USD 40 million to improve the significance of the biomanufacturing of APIs and other biochemicals.
 

The active pharmaceutical ingredients market research report includes an in-depth coverage of the industry with estimates & forecast in terms of revenue in USD from 2018 to 2032, for the following segments:

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By Therapeutic Category,

• Oncology
• Infectious diseases
• Anti-diabetics
• CNS & anesthesia
• Cardiovascular diseases
• Biologics
• Others

By Synthesis,

• Chemical Based API
• Biological API
• Highly Potent API (HPAPI)

By Contract Outsourcing,

• CDMO
• CMO

By Application,

• Humans
• Veterinary

By Drug,

• Prescription
• OTC

The above information is provided for the following regions and countries:

• North America
  • U.S.
  • Canada
• Europe
  • Switzerland
  • France
  • Italy
  • Germany
  • UK
  • Spain
• Asia Pacific
  • China
  • Japan
  • India
  • Australia
  • South Korea
  • Vietnam
  • Indonesia
  • Thailand
• Latin America
  • Brazil
  • Mexico
  • Argentina
  • Colombia
  • Chile
  • Peru
• Middle East & Africa
  • South Africa
  • Saudi Arabia
  • UAE
  • Qatar
  • Bahrain
  • Egypt