Steady Advancement of Active Pharmaceutical Ingredient Market Due to High Incidence of Chronic Diseases
Active pharmaceutical ingredients (APIs) are generally known as ‘bulk pharmaceuticals’. According to the findings of Transparency Market Research, the revenue from the active pharmaceutical ingredient market will rise to US$219.60 bn in 2023, which in 2015 was US$134.7 bn. A promising CAGR of 6.3% is expected between the years 2015 and 2023. According to type, the market can be classified into generic and innovative API.
Teva Pharmaceutical Industries Ltd., Dr.Reddy’s Laboratories Limited, Zhejiang Medicine Co., Ltd., North China Pharmaceutical Group Corp. (NCPC), Zhejiang Hisun Pharmaceutical Co., Ltd., Sandoz (Novartis AG), Aurobindo Pharma Limited, Zhejiang NHU Co., Ltd, Northeast Pharmaceutical Group Co., Ltd., and Zhejiang Huahai Pharmaceuticals Co., Ltd. are a few of the major players in the market.
What are the key drivers and restraints in the active pharmaceutical ingredient market?
The development of geriatrics, a branch of medicine dealing with health and care of the aged population, has contributed significantly to the thriving API market worldwide. Growing awareness about medications and access to healthcare facilities, together with technological advancements, has led to a greater demand for drugs. The API market has gained considerable impetus from these developments.
Emerging economies have been witnessing a rising demand for drugs that use active pharmaceutical ingredients. The rising prevalence of neurological disorders, cardiovascular diseases, diabetes, and other metabolic disorders and diseases has made the manufacturing of the aforementioned drugs imperative. In 2015, these diseases held around 50% share in the worldwide market. A CAGR of 6.63% is projected between 2015 and 2023. The patent loss of several popular drugs between 2011 and 2015 has further opened up the doors for a flourishing API market.
The healthcare budget in developing countries has increased, contributing towards the expansion of the API market. Moreover, the conformity of some API-manufacturing Indian industries with U.S. FDA norms has further propelled the API market. The expansion of the biotechnology sector in Asia Pacific is expected to be a key driver in the market for APIs.
The key restraints in the API market include increasing competition, the implementation of stringent regulatory rules and high manufacturing costs.
Which are the geographical segments dominating the scene in the API market?
In 2014, North America claimed a share of 35.1% in the overall API market. The dominance of North America is on account of large pharmaceutical companies that present a greater demand for active pharmaceutical ingredients. It has been expected that the introduction of biosimilars in the market will further prove to be beneficial for the expansion of the API market in North America.
According to the findings of TMR, Asia Pacific will emerge as a leader in the API market. The API market in emerging economies such as India, Japan, South Korea, and China will gain impetus over the coming years.
Experts within the industry find that Asia Pacific is the second-leading geographical segment in terms of revenue generated. Although presently India and China are leading the API market in Asia, countries such as Indonesia, Philippines, Vietnam, and Malaysia possess rapidly expanding API markets.