Active Pharmaceutical Ingredients (API) Global Market – Forecast To 2025

Active Pharmaceutical Ingredients (APIs) are active substances in a drug intended to achieve pharmacological activity which is having direct effect on disease treatment. APIs are synthesized by chemical synthesis, fermentation, biotechnological methods or enhanced from natural source. According to IQ4I analysis, the global Active Pharmaceutical Ingredient market is expected to grow at a high CAGR to reach $307.2 billion by 2025. Adoption of biologics in disease management and increasing regulatory approvals in the past year, increasing scope of HPAPI market, patent expiration of major drugs, increasing trend of outsourcing and increase in geriatric population are some of the factors driving the market growth. The global API market is mainly segmented by synthesis, by business type, by application and by geography.
API market based on synthesis is further divided into synthetic API, Biotech API and HPAPI. Synthetic API holds major share in 2018 and is expected to grow at a mid single digit CAGR from 2018 to 2025. The major factors driving the synthetic chemical API market are patent expiration of synthetic (small molecule drugs), increasing number of small molecules in clinical trials, increasing outsourcing by the pharmaceutical companies, CMOs investments to expand manufacturing facilities, rise in incidence of chronic and age-related diseases, rapid growth in oncology market, technological advancement like cryogenic and continuous flow manufacturing. Based on the customer, the synthetic API is further divided into branded API and generic API. Branded API accounted the largest share in 2018 and is expected to grow at a mid single digit CAGR from 2018 to 2025. Generic API is expected to grow at a high single digit CAGR from 2018 to 2025, due to Patent expiry of blockbuster drugs, rising healthcare expenses, increasing outsourcing and shift towards the generic medicines led by the government initiatives.
Biotech API is expected to grow at a high single digit CAGR from 2018 to 2025. Increased investment in R&D by pharmaceutical companies for developing biologic drugs, adoption of biological therapies in disease management, increasing outsourcing, increasing biologics approvals in the past year, increasing chronic and autoimmune illnesses, increasing number of branded drugs going off-patent creating a scope for biosimilars, requirement of novel biologics therapeutics for rare diseases, increasing demand for antibody conjugates are few factors driving the biotech API market. Biotech API is further segmented into monoclonal antibodies, recombinant proteins, vaccines and others (stem cell therapy and gene therapy). Monoclonal antibodies accounted for highest share in 2018 and expected to grow at a double digit CAGR from 2018 to 2025. Development of next generation antibodies such as antibody-drug conjugates and rising venture capital investments and applications of monoclonal antibodies are the factors booming monoclonal antibodies market growth. Based on the customer, biotech API is further divided into biologics and biosimilars. Biologics accounted the largest share in 2018 and is expected to grow at a high single digit CAGR from 2018 to 2025. Biologics market is driven globally due to adoption of biological therapies in disease management, increasing biologics approvals in the past year, increasing chronic and autoimmune illnesses and increasing elderly population globally. Biosimilars is expected to grow at a mid double digit CAGR from 2018 to 2025. Factors driving the biosimilar drug market are patent expiry of biological drugs, low cost compared to biologics health care expenditure, increase in chronic diseases, growing geriatric population, demand for quality healthcare.
HPAPI is expected to grow at a high single digit CAGR from 2018 to 2025. Rapid growth in oncology market, low toxicity and lower side effects, technological advancements in HPAPI, increasing outsourcing, increasing incidence of chronic and age related diseases are few factors driving the HPAPI market growth. Based on customer, HPAPI is further divided into branded API and generic API. Branded API is accounted the largest share in 2018 and is expected to grow at a high single digit CAGR from 2018 to 2025, increased development of targeted therapy APIs, increased investments in the manufacturing of branded HPAPI are the factors driving the market. Generic API is expected to grow at a high single digit CAGR from 2018 to 2025. Patent expiry of blockbuster drugs, rising healthcare expenses and shift towards the generic medicines led by the government initiatives are some of the factors driving the generic HPAPI market.
By business type, global API market is divided into captive API and merchant API. Captive market holds major share in 2018 and is expected to grow at a mid single digit CAGR from 2018 to 2025, captive API is further divided into branded captive API and generic captive API, branded captive API accounted the largest share in 2018 and is expected to grow at a mid single digit CAGR from 2018 to 2025. Merchant API market is fastest growing segment with a high single digit CAGR from 2018 to 2025. Novel drugs patent expiry, high cost of innovative drugs and complications in innovative drug manufacturing are some of the factors driving the growth of Merchant API market. Merchant API market is further divided into branded merchant API and generic merchant API. Generic merchant API accounted the largest share in 2018 and is expected to grow at a double digit CAGR from 2018 to 2025. Increasing outsourcing, advanced manufacturing facilities, lack of in-house manufacturing capability, high capital investment and cost of API manufacturing are the factors driving Merchant API market.
By therapeutic applications, API market is segmented into infectious diseases, oncology, cardiovascular disorders, central nervous system, pulmonary disorder, gastrointestinal disorder, endocrine disorders, metabolic disorders, genito-urinary disorders, musculo-skeletal disorders and others. In application segment, Oncology holds major share in 2018 and expected to grow at a high single digit CAGR from 2018 to 2025. In synthetic API, infectious diseases accounted the largest share in 2018 and is expected to grow at a high single digit CAGR from 2018 to 2025, oncology is expected to grow at a high single digit CAGR from 2018 to 2025. In biotech API, musculoskeletal disorders accounted the largest share in 2018 and is expected to grow at a high single digit CAGR from 2018 to 2025, oncology is expected to grow at a double digit CAGR from 2018 to 2025. In HPAPI, oncology accounted the largest share in 2018 and is expected to grow at a high single digit CAGR from 2018 to 2025. Biotech API and HPAPI is driving the market growth at faster pace due to rising targeted therapy demand in last 15 years for treatment of diseases mainly in oncology sector.
Active pharmaceutical Ingredients market by region is segmented as North America, Europe, Asia-Pacific and Rest of the world (ROW) where North America holds largest share in 2018 and is expected to grow at a high single digit CAGR from 2018 to 2025. Patent expiration of the major drugs, rising demand for biotech APIs from government and private companies, market entry of biosimilars, increasing scope of high potent drugs and increase in the prevalence of chronic diseases such as cancer, musculoskeletal disorder, cardiac disease are some of the major factors driving the North America API market. Asia-Pacific region is expected to grow at a high single digit CAGR from 2018 to 2025. Low labor cost, abundance availability of raw materials, infrastructure facility, rise in generic drugs demand, increased production capabilities, the presence of large number of domestic and international players, and concentration of CMO companies are some of the factors that are driving the market growth.
Some of the key players of Active pharmaceutical Ingredient (API) market are Lonza Group (Switzerland), Boehringer Ingelheim GmbH (Germany), Teva Pharmaceutical Industries LTD (Israel), Sanofi (France), Patheon N.V (U.S), Aurobindo pharmaceuticals. (India), Seigfried Holdings A.G (Switzerland), Olon S.p.A (Italy), Pfizer Inc. (U.S.), GlaxoSmithKline plc. (U.K.), Cambrex Corporation (U.S.) and AMRI, (U.S.).
The report provides an in-depth market analysis of the above-mentioned segments across the following regions:
• North America
o U.S.
o Rest of North America
• Europe
o Italy
o Germany
o France
o Rest of Europe
• Asia-Pacific
o China
o Japan
o India
o Rest of APAC
• Rest of the World (RoW)
o Brazil
o Rest of Latin America
o Middle East and Others