The global Active Pharmaceutical Ingredient (API) industry is estimated to reach USD 260.15 billion by 2025 from USD 182.2 billion in 2019, at a CAGR of 6.2% during the forecast period. The increasing incidence of chronic diseases, growing importance of generics, and the increasing uptake of biopharmaceuticals are some of the major factors driving the growth of the global Active Pharmaceutical Ingredient (API) industry. On the other hand, the unfavorable drug price control policies across various countries and the increasing penetration of counterfeit drugs are expected to restrain the growth of this industry in the coming years.
Based on the type of drug, the Active Pharmaceutical Ingredient (API) industry can be classified into two segments prescription drugs and over-the-counter (OTC) drugs. In 2019, the prescription drugs segment is expected to account for the largest share of the Active Pharmaceutical Ingredient (API) industry. The demand for drugs falling under this category has increased significantly in recent years due to the rising prevalence of target diseases. Additionally, the largest share of the prescription drugs segment can also be attributed to the increased focus of innovator companies on the development of specialty drugs and affordability of healthcare. The implementation of significant federal reforms to improve the affordability of healthcare, especially in the US, has expanded the consumption of both traditional and specialty drugs. Also, inflation has played a key role in enhancing revenue from the sales of prescription drugs, particularly specialty drugs. All these factors are collectively responsible for the large share of this segment.
Based on type of manufacturer, the Active Pharmaceutical Ingredient (API) industry can be divided into captive API manufacturers and merchant API manufacturers. In 2019, the captive API manufacturers segment is expected to account for the largest share of the Active Pharmaceutical Ingredient (API) industry. This can be attributed to the fact that most big pharmaceutical companies possess their API manufacturing facilities and are vertically integrated across the pharmaceutical supply chain. Moreover, innovator companies prefer in-house manufacturing of innovative products to avail economic benefit and prevent technology leakage.
On the basis of expression system, biotech Active Pharmaceutical Ingredient (API) can be categorized into mammalian expression systems, microbial expression systems, Yeast expression systems, insect expression systems, and other expression systems. The biotech Active Pharmaceutical Ingredient (API) industry, by expression system, is dominated by mammalian expression systems owing to their ability to achieve the highest level of post-translational modifications and efficient protein folding, which makes them suitable for human use.
Geographically, the active pharmaceutical ingredients industry is segmented into North America, Europe, Asia, and the Rest of the World (RoW). In 2019, North America is expected to dominate the industry, followed by Europe. The major factors driving the overall growth of the APIs industry in this region include the growing incidence of preventable chronic diseases, increasing government focus on generic drugs, rising demand for biologics and specialty drugs, and technological advancements in the manufacturing processes of APIs. This industry segment is expected to grow at a modest rate due to a combination of economic and healthcare severity measures and the introduction of low-cost, generic versions of branded drugs.
Major Market Players in active pharmaceutical ingredients market are Pfizer, Inc. (US), Novartis AG (Switzerland), Sanofi (France), Cipla Inc., Bristol-Myers Squibb Company, Boehringer Ingelheim (Germany), Bristol-Myers Squibb (US), Teva Pharmaceutical Industries Ltd. (Israel), Lupin Ltd, Eli Lilly and Company (US), Albemarle Corporation, BASF SE, Mylan N.V., Aurobindo Pharma, GlaxoSmithKline plc (UK), Merck & Co., Inc. (US), AbbVie Inc. (US), F. Hoffmann-La Roche Ltd. (Switzerland), Sun Pharmaceutical Industries Ltd., Dr. Reddy’s Laboratories Ltd, and AstraZeneca plc (UK).
Active Pharmaceutical Ingredients Industry Segmentation:
Active Pharmaceutical Ingredients industry, By Type
Active Pharmaceutical Ingredients industry, By Type of Manufacturer
Active Pharmaceutical Ingredients industry, By Type of Drug
Active Pharmaceutical Ingredients industry, By Therapeutic Application
Active Pharmaceutical Ingredients industry, By Region