Market Trends of API Contract Manufacturing Industry
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.
