Pharmaceutical raw materials include both active pharmaceutical ingredients (APIs) and inactive ingredients or excipients. APIs are bulk drugs that are pharmaceutically active and generate a desired pharmacological effect, whereas, excipients are pharmacologically inactive substances that are generally used as a carrier of the API in the drug.
Excipients provide bulkiness to formulations, facilitate absorption of the drug, provide stability and prevent denaturation of drugs. Pharmaceutical excipients are cost effective, stable, feasible for handling, and inert in nature. Excipients are used in a variety of medicinal products such as capsules, tablets, oral liquids, inhalers, implants and injections among others.
According to ASD Reports the global pharmaceutical excipients market is driven by an increase in demand for oral drugs. Factors such as increasing patient compliance and ease of consumption are forcing drug manufacturers to develop oral solid dosage products with very specific properties. The introduction of functional excipients has greatly enhanced drug formulator’s capabilities to develop drugs for APIs with poor solubility, or in some cases to develop a sustained release dosage formulation of an existing drug which will extend the shelf-life and the revenue of an existing product.
Industry analysts forecast the global pharmaceutical excipients market to grow at a CAGR of 6.53% through 2021 to reach $7.7B by 2022.
North America holds the largest share in the pharmaceutical excipient market due to rising demand for pharmaceutical and biopharmaceutical drugs and presence of a large number of excipient manufacturers in this region. Europe holds second major share followed by Asia-Pacific and Rest of the World. Asia-Pacific is the fastest growing region where emerging countries such as China and India are the major players due to low labor costs, increased outsourcing of inorganic and organic chemicals manufacturing and increasing governmental spending on health care.
Active Pharmaceutical Ingredients
The Global Active Pharmaceutical Ingredients market is expected to reach $198.8 billion by 2022 with a CAGR of 6.4%. Patent expiration of prominent drugs, government initiatives, regional penetration and increasing aged population are some of the factors that are driving the market growth. Strict validation and safety guidelines stated by WHO and fragmented market are the factors that are hampering the API market growth.
The generic/non- branded segment of the industry witnessed the largest market share during the forecast period due to rising healthcare costs, government prominence on generics for dropping healthcare costs, and decreasing pipelines of global pharmaceutical products. Asia Pacific is expected to be highest market share during the forecast period due to low operation costs and high investments in medical research. Moreover, the high cost of skilled labor and energy are the most significant factors that enforced European market to move its base to developing countries, such as India and China.