As per our analysis report, the global active pharmaceutical ingredients market size is expected to be growing at a CAGR of 6.3% from 2024 to 2029. This market is estimated to value USD 384.47 million in 2024 and USD 521.69 million by 2029.
The active pharmaceutical ingredients are chemically and biologically active components of drugs directly affecting the mitigation, cure, prevention, and treatment of diseases. Chemical synthesis, fermentation, biotechnological approaches, and improved natural sources are all used to create APIs. The API represents the primary ingredient. Excipients are a term used to describe other substances. Medicine may include numerous APIs, and the impact on a patient is determined by the dose administered, which varies from person to person. Two or more active substances are used in combination treatments to treat different symptoms in various ways. Since the API is the key component examined when writing a prescription, strict quality control is required for medication manufacture. There are two main processes in the production of pharmaceuticals. Manufacturers turn raw ingredients into APIs in the first phase. The last step entails combining APIs and excipients into tablets, capsules, solutions, and other forms and packaging the medicine for usage by end-users. APIs are sold on the open market (also known as the merchant market) or used as inputs in final formulations by manufacturers.
In the last few decades, there has been an increase in incidences of chronic diseases such as coronary artery disease, diabetes, chronic obstructive pulmonary disease (COPD), arthritis, hepatitis, cancer, and asthma across the globe, which is estimated to drive demand for the global active pharmaceutical ingredients market growth. In addition, the rise in the geriatric population around the globe and changes in lifestyle and diet due to rapid urbanization are significant factors contributing to the market's growth.
Favourable government policies with many preparations for drug activities and a price hike are significant positive signs for the global active pharmaceutical ingredients market growth. Companies cannot prepare a generic drug unless the drug's patent expires. Besides the emerging biosimilar market, the growing reach of HPAPI solutions, emerging markets, and emerging technologies have opened up many opportunities for the global active pharmaceutical ingredients market growth. The global active pharmaceutical ingredients market is providing opportunities for the emerging biosimilars market. Due to the rise in various disease incidences, numerous off-patent biologics demands for biosimilars in different therapeutic applications are incremented. Over the next decade, expect the expiration of patents and other intellectual property rights for biologics originators is growing, and many biosimilar opportunities help enter the API market.
The major restraint in the global active pharmaceutical ingredients market is the high costs of manufacturing APIs. However, to improve manufacturing facilities, increased investments are needed for key players to comply with standards like CGMP. Renovation of product facilities, inculcating familiarity with the requirement of qualification processes. In addition, there is a high expenditure to obtain regulatory approvals from authorities. Even chemical synthesis of APIs also requires high expenses, and uncommon building blocks and raw materials add to manufacturing costs. Factors such as lessening or shortening the developing time, cost of the development to be reduced, improving the process design, compromising the gain or profits, a meeting the standard quality are the challenges on the other side. The global active pharmaceutical ingredients market is marked by violent criminal competition, which is challenging.
REPORT METRIC |
DETAILS |
Market Size Available |
2023 to 2029 |
Base Year |
2023 |
Forecast Period |
2024 to 2029 |
Segments Covered |
By Type of Manufacturing Process, Type of Synthesis, API Formulation, Application, Molecules, and Region |
Various Analyses Covered |
Global, Regional & Country Level Analysis, Segment-Level Analysis, Drivers, Restraints, Opportunities, Challenges PESTLE Analysis; Porter's Five Forces Analysis; competitive Landscape, Analyst Overview of Investment Opportunities. |
Regions Covered |
North America, Europe, Asia Pacific, Latin America, Middle East & Africa |
Market Leader Profiled |
Sanofi, Bayer AG, Pfizer Inc., F. Hoffmann-La Roche AG, Abbott Laboratories, Merck & Co |
Based on API formulation, the innovative API segment is expected to account for the majority in 2022. The large share of this segment can be attributed to the increasing number of FDA approvals for new molecular entities, higher prices commanded by innovative APIs as compared to their generic equivalents, and the growing focus of innovator APIs companies on R&D for the development of novel, innovative API products to cater to the unmet medical needs of the Global active pharmaceutical ingredients market.
The cardiovascular disease segment is expected to dominate the market during the forecast period due to the rising cases of cardiovascular diseases and the incidences of rising cholesterol levels in cardiac patients resulting in a risk of heart attacks and diseases. For example, according to WHO stats, each year, 17.9 million people die from cardiovascular diseases (CVDs), the most significant cause of death in the world. Additionally, the government has taken several initiatives to raise awareness regarding the rising risks of high cholesterol and cardiovascular diseases ad has even promoted cardiac drugs leading to segment growth.
The small molecules segment is expected to dominate the market during the forecast period, as 90% of the current pharmaceutical markets use small molecules. Drug development has always been based on small molecules. They are easily ingested in the gastrointestinal tract because of their small size, and their active ingredients are promptly absorbed into the bloodstream, where they can go to any part of the body. In addition, these molecules are tiny enough to easily pass through cell membranes as they move around the body. Therefore, their advantageous nature helps them dominate the market revenue.
Regionally, the North American Active pharmaceutical ingredients market is predicted to dominate the global API market during the forecast period due to technological advancements and the high development of the economy. Moreover, the increase in the prevalence of cancer diseases and other lifestyle-related diseases to encourage R& D activities propels the market's demand.
The Asia-Pacific API market is expected to register a high growth rate compared to other regions in the global active pharmaceutical ingredients market during the forecast period. Factors such as increasing healthcare expenditures and a growing aging population create a vast patient pool and rising economies in this region. Additionally, key players' initiatives in setting up API manufacturing plants in developing countries like India and China and laborers' availability contribute to growth in the Asia-Pacific region.
China is considered to be the leader in API manufacturing in the APAC region. Many domestic companies are involved in manufacturing and supplying API all over the world. Not just in the Asia-Pacific region, China exports a significant share of its domestically produced API worldwide.
List of key market participants leading the global active pharmaceutical ingredients market profiled in this report is Sanofi, Bayer AG, Pfizer Inc., F. Hoffmann-La Roche AG, Abbott Laboratories, Merck & Co., Inc., Boehringer Ingelheim GmbH, GlaxoSmithKline Plc (GSK), Novartis AG, Eli Lilly and Company and Teva Pharmaceutical Industries Ltd.
In 2020, to manufacture and supply Gilead's antiviral drug (Remdesivir), a multilayer agreement was signed by Pfizer (U.S.) with Gilead Sciences for the treatment of COVID-19.
In 2020, an acquisition was made by Novartis with Aspen's Japanese operations to strengthen its position globally by generics and the off-patent medicines market. Already Novartis agreed to manufacture and supply with Aspen.
This research report on the global active pharmaceutical ingredients market has been segmented and sub-segmented based on the manufacturing process type, synthesis, API formulation, application, molecules, and region.
By Type of Manufacturing Process
By Type of Synthesis
By API Formulation
By Application
By Molecule
By Region
Frequently Asked Questions
The global active pharmaceutical ingredients market is estimated to grow at a CAGR of 6.3% from 2024 to 2029.
Yes, we have studied and included the COVID-19 impact on the global active pharmaceutical ingredients market in this report.
Geographically, the North American active pharmaceutical ingredients market accounted for the largest share of the global market in 2024.
As per our research report, the global active pharmaceutical ingredients market size is projected to be 521.69 million by 2029.
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