API Contract Manufacturing Market Size
| Study Period | 2019 - 2029 |
| Market Size (2024) | USD 194.07 Billion |
| Market Size (2029) | USD 295.37 Billion |
| CAGR (2024 - 2029) | 7.20 % |
| Fastest Growing Market | North America |
| Largest Market | Asia Pacific |
Major Players
*Disclaimer: Major Players sorted in no particular order |
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API Contract Manufacturing Market Analysis
The API Contract Manufacturing Market size is estimated at USD 194.07 billion in 2024, and is expected to reach USD 295.37 billion by 2029, growing at a CAGR of 7.20% during the forecast period (2024-2029).
Growing demand for API contract manufacturing services drives the industry's growth as companies seek to benefit from cost savings and increased efficiency. Also, the installation and maintenance of the facility is complex and requires specialized engineers. The high cost of producing API in-house and the pressure to deliver affordable drugs have significantly contributed to companies' increasing outsourcing activities. There are various reasons why the demand for specific markets will increase. For instance, companies recognize the importance of focusing on their main activities, such as research and development, marketing, and regulatory compliance. In addition, there is a need to reduce the time it takes for drugs to be developed and launched in the market. These factors are expected to create profitable growth opportunities for the target market.
The increasing development and clinical trials of biosimilar and biologics drugs for new therapeutic classes are expected to increase their adoption by physicians and patients. This is anticipated to increase the demand for APIs, propelling the market's growth. As per Cardinal Health’s 2022 Biosimilars Report, significant progress has been made in the adoption of biosimilars in the United States, particularly in oncology, where all three classes of therapeutic oncology biosimilars (i.e., rituximab, bevacizumab, and trastuzumab) have exceeded 60% market share.
Similarly, as per the same source, as of January 2022, there were 33 FDA-approved biosimilars in the United States, of which 21 are commercially available. Of the 21 biosimilars, 17 are used for treatments associated with cancers, three are used to treat autoimmune conditions, and one is used to treat diabetes. Thus, increasing demand for biosimilar and biologics drugs will create lucrative market growth opportunities during the forecast period.
The strategic activities of the market players, such as expansion of the API facilities, partnership, and collaboration, are expected to boost market growth during the forecast period. For instance, in April 2022, Cambrex completed a USD 50 million expansion of its large-scale API manufacturing capabilities at its Charles City, Iowa, facility. The facility is located on a 45-acre property and produces APIs and pharmaceutical intermediates, including highly potent molecules and controlled substances. Additionally, in January 2022, Formosa Laboratories, a Taoyuan, Taiwan-based CDMO of APIs, ADCs, and injectables, invested USD 20 million to expand its API manufacturing facility to build up its bioconjugation ADC platform, a peptide-generation system for personalized medicine production and a microfluidic synthesis system at its facility in Taiwan.
Hence, increasing outsourcing of API manufacturing, the growing burden of chronic diseases, and market players' strategic activities are expected to boost market growth during the forecast period. However, intellectual property concerns and stringent regulatory guidelines are expected to restrain market growth during the forecast period.
API Contract Manufacturing Market Trends
The Cancer Segment is Expected to Hold a Significant Share During the Forecast Period
Cancer treatments have become more sophisticated and personalized. Tailored therapies often involve complex APIs that may require specialized manufacturing capabilities. In addition, ongoing research and advancements in oncology have led to the development of new and targeted therapies for various types of cancers, and the global prevalence of cancer has been on the rise. A growing number of cancer cases worldwide create a demand for innovative and effective cancer treatments. Hence, it will likely increase the demand for cancer API contract manufacturing.
The growing burden of cancer is expected to fuel the segment's growth during the forecast period. For instance, according to the data updated by the Spanish Network of Cancer Registries (REDECAN) in January 2023, an estimated 279,260 new cases of cancer were expected to occur in Spain by the end of 2023, out of which 42,721 new cases of colorectal cancer, 31,282 cases of lung cancer, and 21,694 cases of urinary bladder cancer were expected to occur in Spain in 2023. This data shows a rapid increase in the incidence of cancer cases in the country, which is likely to increase over time, thus raising the demand for oncology drugs, which, in turn, is expected to create demand for CMOs, thereby driving segmental growth.
Moreover, the strategic activities of the market players, such as partnership and collaboration, are expected to boost market growth during the forecast period. For instance, in October 2023, Flawless Pharma announced that it signed deals with a European contract development and manufacturing organization (CDMO) and an African firm in Africa for the export and supply of the active ingredient of the anti-cancer and anti-viral drugs with a technology transfer agreement. Additionally, in November 2022, Novo Nordisk invested DKK 5.4 billion (USD 749 million) to boost API manufacturing needed to support its clinical trials.
Hence, owing to the growing incidence of cancer and its risk factors and new investments in API facility expansion, the market is expected to grow during the forecast period.
Asia-Pacific is Expected to Hold a Significant Market Share During the Forecast Period
Asia-Pacific is rapidly developing and is considered one of the most appealing markets for API contract manufacturing. Due to the high production costs of APIs in Western countries, India and China have emerged as the top choices for outsourcing contract manufacturing. Key drivers include the increasing production of generic pharmaceuticals, various key players operating in the pharmaceutical market with extensive manufacturing facilities, expanding outsourcing to CMOs, clinical trials, cost-effectiveness, government investments in the pharmaceutical industry, etc.
The pharmaceutical industry's increasing reliance on contract manufacturing is influenced by strategic initiatives taken by CMOs, such as technological advancements and expanded offerings. For instance, in May 2022, the businesses NovAliX, Alysophil, De Dietrich Process Systems, and Bruker launched a novel method for producing active pharmaceutical ingredients (APIs) on the market. A pharmaceutical company or contract manufacturing business will receive a complete, standalone, and location-independent API production solution from the cooperation by utilizing its complementing skills (CMO).
Moreover, increasing company activities to increase API production by expanding manufacturing facilities is expected to bolster market growth. For instance, in December 2022, Lonza spent USD 21.5 billion on its Nansha, China, plant to enhance its API development and manufacturing capacity. Additionally, in July 2022, Piramal Pharma Limited’s Pharma Solution business site in Digwal in Telangana, India, implemented new tools to unlock active pharmaceutical ingredient manufacturing capacity and support client needs in drug development and on-patent projects.
Therefore, with favorable regulation for CMO and the growing expansion of the company's manufacturing facility, the market is expected to grow during the forecast period.
API Contract Manufacturing Industry Overview
The API contract manufacturing market is fragmented due to several companies operating globally and regionally. The companies are focused on expanding the API contract manufacturing facilities. Some of the major market players in the API contract manufacturing market are Teva Pharmaceuticals Industries Ltd, Sun Pharmaceutical Industries Ltd, Boehringer Ingelheim GmbH, Piramal Pharma Solutions, Abbvie, and Novartis (Sandoz AG).
API Contract Manufacturing Market Leaders
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Teva Pharmaceuticals Industries Ltd
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Sun Pharmaceutical Industries
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Boehringer Ingelheim GmbH
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Piramal Pharma Solutions
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AbbVie
*Disclaimer: Major Players sorted in no particular order
API Contract Manufacturing Market News
- April 2024: Drug API Innovation Center partnered with St. Louis-based Apertus Pharmaceuticals, a CDMO, to expand its API production capabilities in Missouri. This partnership aims to increase the availability and affordability of lomustine for cancer patients in the United States.
- October 2023: Egis expanded its API contract development and contract manufacturing portfolio to provide active pharmaceutical ingredient development and manufacturing services for original and generic pharmaceutical companies.
API Contract Manufacturing Market Report - Table of Contents
1. INTRODUCTION
- 1.1 Study Assumptions and Market Definitions
- 1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
- 4.1 Market Overview
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4.2 Market Drivers
- 4.2.1 Growing Demand for Generic Medicines Due to Patent Expirations
- 4.2.2 Increasing Trend of Outsourcing for API
- 4.2.3 Growing Demand for Generic Medicines Due to Patent Expirations
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4.3 Market Restraints
- 4.3.1 Intellectual Property Concern
- 4.3.2 Stringent Regulatory Requirements
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4.4 Porter's Five Forces Analysis
- 4.4.1 Bargaining Power of Suppliers
- 4.4.2 Bargaining Power of Buyers/Consumers
- 4.4.3 Threat of New Entrants
- 4.4.4 Threat of Substitute Products
- 4.4.5 Intensity of Competitive Rivalry
5. MARKET SEGMENTATION (Market Size by Value – USD)
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5.1 By Type
- 5.1.1 Organic
- 5.1.2 Inorganic
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5.2 By Formulation
- 5.2.1 Solid
- 5.2.2 Liquid
- 5.2.3 Semi-solid
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5.3 By Molecule
- 5.3.1 Small Molecule API
- 5.3.2 Large Molecule API
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5.4 By Manufacturing
- 5.4.1 Clinical Manufacturing
- 5.4.2 Commercial Manufacturing
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5.5 End User
- 5.5.1 Pharmaceutical and Biotechnology Companies
- 5.5.2 Research Organization
- 5.5.3 Other End Users
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5.6 Geography
- 5.6.1 North America
- 5.6.1.1 United States
- 5.6.1.2 Canada
- 5.6.1.3 Mexico
- 5.6.2 Europe
- 5.6.2.1 United Kingdom
- 5.6.2.2 Germany
- 5.6.2.3 France
- 5.6.2.4 Spain
- 5.6.2.5 Italy
- 5.6.2.6 Rest of Europe
- 5.6.3 Asia-Pacific
- 5.6.3.1 India
- 5.6.3.2 Japan
- 5.6.3.3 China
- 5.6.3.4 Australia
- 5.6.3.5 South Korea
- 5.6.3.6 Rest of Asia-Pacific
- 5.6.4 Middle East and Africa
- 5.6.4.1 GCC
- 5.6.4.2 South Africa
- 5.6.4.3 Rest of the Middle East and Africa
- 5.6.5 South America
- 5.6.5.1 Brazil
- 5.6.5.2 Argentina
- 5.6.5.3 Rest of South America
6. COMPETITIVE LANDSCAPE
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6.1 Company Profiles
- 6.1.1 Teva Pharmaceuticals Industries Ltd
- 6.1.2 Sun Pharmaceutical Industries Ltd
- 6.1.3 Boehringer Ingelheim GmbH
- 6.1.4 Piramal Pharma Solutions
- 6.1.5 Novartis AG (Sandoz AG)
- 6.1.6 GlaxoSmithKline PLC
- 6.1.7 Sterling Pharma Solutions
- 6.1.8 Juniper Pharmaceutical
- 6.1.9 CordenPharma International
- 6.1.10 Curia Global Inc.
- 6.1.11 AbbVie
- 6.1.12 PCI Pharma Services
- *List Not Exhaustive
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
** Subject To AvailablityAPI Contract Manufacturing Industry Segmentation
API contract manufacturing market is segmented by type, form, molecules, manufacturing, end users, and geography. By type, the market is segmented as organic and inorganic. The market is segmented by form as solid, liquid, and semi-solids. The market is segmented by molecules as small molecules API and large molecules API. By manufacturing, the market is segmented into clinical and commercial manufacturing. The market is segmented by end users, such as pharmaceutical industries, research organizations, and other end users. By geography, the market is segmented as North America, Europe, Asia-Pacific, Middle East and Africa, and South America. The report also covers the estimated market sizes and trends for 17 countries across major regions globally. The report offers the value (in USD) for the above segments.
| By Type | Organic | |
| Inorganic | ||
| By Formulation | Solid | |
| Liquid | ||
| Semi-solid | ||
| By Molecule | Small Molecule API | |
| Large Molecule API | ||
| By Manufacturing | Clinical Manufacturing | |
| Commercial Manufacturing | ||
| End User | Pharmaceutical and Biotechnology Companies | |
| Research Organization | ||
| Other End Users | ||
| Geography | North America | United States |
| Canada | ||
| Mexico | ||
| Geography | Europe | United Kingdom |
| Germany | ||
| France | ||
| Spain | ||
| Italy | ||
| Rest of Europe | ||
| Geography | Asia-Pacific | India |
| Japan | ||
| China | ||
| Australia | ||
| South Korea | ||
| Rest of Asia-Pacific | ||
| Geography | Middle East and Africa | GCC |
| South Africa | ||
| Rest of the Middle East and Africa | ||
| Geography | South America | Brazil |
| Argentina | ||
| Rest of South America |
API Contract Manufacturing Market Research FAQs
How big is the API Contract Manufacturing Market?
The API Contract Manufacturing Market size is expected to reach USD 194.07 billion in 2024 and grow at a CAGR of 7.20% to reach USD 295.37 billion by 2029.
What is the current API Contract Manufacturing Market size?
In 2024, the API Contract Manufacturing Market size is expected to reach USD 194.07 billion.
Who are the key players in API Contract Manufacturing Market?
Teva Pharmaceuticals Industries Ltd, Sun Pharmaceutical Industries, Boehringer Ingelheim GmbH, Piramal Pharma Solutions and AbbVie are the major companies operating in the API Contract Manufacturing Market.
Which is the fastest growing region in API Contract Manufacturing Market?
North America is estimated to grow at the highest CAGR over the forecast period (2024-2029).
Which region has the biggest share in API Contract Manufacturing Market?
In 2024, the Asia Pacific accounts for the largest market share in API Contract Manufacturing Market.
What years does this API Contract Manufacturing Market cover, and what was the market size in 2023?
In 2023, the API Contract Manufacturing Market size was estimated at USD 180.10 billion. The report covers the API Contract Manufacturing Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the API Contract Manufacturing Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
API Contract Manufacturing Industry Report
Statistics for the 2024 API Contract Manufacturing market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. API Contract Manufacturing analysis includes a market forecast outlook for 2024 to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
