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Global Active Pharmaceutical Ingredient (API) Market: A lifeline of Healthcare Sector

The basic composition of a drug consists of two components, namely, an API (active pharmaceutical ingredient) and an excipient. The API denotes the substantial drug properties itself. Whereas, the excipients can be said as the carriers of the APIs, i.e., do not show therapeutic properties.

Conclusively, API is devised to show therapeutic effects. Thus, drugs that are intended to be used for the treatment of multiple complications can have multiple APIs.

Market Summary

In this modern age, diseases and health complications are extensively medicalized. Many of the primary medical conditions are treated using drugs, making API market an inevitable part of the global healthcare sector.

Increasing global burden of chronic and acute diseases, increasing per capita healthcare expenditure, growing market of generic drugs, increasing R&D by the pharmaceutical companies, rising geriatric population and advanced manufacturing process of API are some of the major factors driving the market growth.

Amongst these driving factors increased per capita expenditure is playing the most significant role to boost the market. Data from the WHO health expenditure database shows that per capita healthcare expenditure in the USA increased from USD 4,562 in 2000 to USD 9,536 in 2015. API market is a part of the health care sector is also positively influenced by this increase of expenditure.

However, there are some restraining factors that are holding back the market from further growth which includes, legal interventions in the API market, no predominant global organization to regulate price, variance in the quality control regulations across the globe and centralized production plant in specific areas of the globe.

Such factors are estimated to drive the global API market. The market is projected to be about USD 184 billion in 2019 and reach ~USD 249 billion by 2025 with an approximate CAGR of 7.0%. 

Key Developments in the field

Precision Medicine:

Precision medicine is one of the recent developments in this industry. This is the customized medicine where genome sequencing is used to determine the compatibility of APIs in a specific patient, which makes precision medicine more efficient and effective solution to the people who are allergic to certain APIs. This feature of customization makes precision medicine an innovative product that may affect the future market. 

3D Printing in medicine:

3D printing has recently got affiliated with the API industry. Even distribution and higher dosing of API are some of the common advantages associated with the 3D printing of medicine.

Following such a course, Spritum by Aprecia Pharmaceuticals became the first 3D printed drug in the market. Such a development in the market can provide new opportunities for the market to develop.

Dominant region and fastest growing region

In terms of revenue, North America holds the largest market share and is projected to retain its dominance till 2025 it is reportable that though the market players are headquartered in North America and Europe, a majority of the production sites falls for Asia Pacific region. This is due to the presence of cheap labour within the region. This makes the product availability much easier within the region. Moreover, the presence of local players in the Asia Pacific region makes it lucrative for market growth. Thus, the Asia Pacific market is estimated to grow with the highest CAGR.

Market Segments:

The global API market is colossal and can be directly affiliated with the global healthcare sector. The market for API is segmented on the basis of the manufacturing process of API, API type, application, and region

In terms of the manufacturing process, the market can be split into a captive market and contract market. As per API type, the market is sub-segmented into synthetic API, chemical API, and biotechnological APIs.

The produced API is applied in various arenas of health sectors upon which the global API market can be segmented into cardiology, neurology, oncology, and others.

The market on the basis of the geographical region can be segmented into North America which consists of countries as the USA, Canada etc.  Europe consisting of countries as the UK, Germany, France, Switzerland etc. Asia Pacific region comprises of emerging countries like China, India and other emerging economies as Malaysia and Singapore. Countries like South Africa accounts for the rest of the world.

The pie chart below shows the percentage of the API industry in geographical market segmentation.

Key players of the Global API market

The global APIs market is competitive in nature, owing to the presence of several big as well as emerging players. The prominent players in the market are Pfizer Inc., Novartis AG, Sanofi, Boehringer Ingelheim, Bristol-Myers Squibb, Teva Pharmaceutical Industries Ltd, Eli Lilly and Company, GlaxoSmithKline plc, Merck&Co Inc, AbbVie Inc, F. Hoffmann-La Roche Ltd, and AstraZeneca plc, FARMHISPANIA GROUP, Symbiotec Pharma Lab Pvt. Ltd, GlycoSyn, Inalco Pharma, PolyPeptide Laboratories, Pepscan, Biospring, SennChemicals AG, Fermion etc.

 

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