Active Pharmaceutical Ingredient (API) Market Size, Share, Growth, Trends, and Global Industry Analysis: By Type of Synthesis (Biotechnological, Synthetic, Semi-Synthetic), By Application Area (Cardiovascular System, Oncology, CNS & Neurological System, Orthopaedic, Endocrinology, Pulmonology, Gastrointestinal System, Nephrology System, Ophthalmology, Others) and Region Forecast 2020-2031

Active pharmaceutical ingredient market size was valued at US$ 170.3 billion in 2024 and is expected to reach US$ 286.2 billion by 2031, growing at a significant CAGR of 7.7% from 2025-2031. Factors such as increased drug R&D, the rising incidence of chronic diseases, the growing importance of generics, and the rising consumption of biopharmaceuticals are all driving market expansion. Unfavorable medicine price control rules in several countries, as well as high production costs, are projected to limit the market's expansion. Government regulations that encourage API development, as well as changes in geopolitical situations, are propelling the market forward. The API market is facing significant changes as a result of COVID-19's supply chain disruption. Due to geopolitical circumstances and a desire to lessen reliance on China for API products, countries such as India are being favored over China for API export.

An active pharmaceutical ingredient (API) is a part of the drug that produces a pharmacological effect. Some drugs such as combination therapy have multiple active pharmaceutical ingredients (API) to treat different symptoms in different ways. APIs provide health benefits and play a vital role in prevention, treatment and diagnosis. Active Pharmaceutical ingredients may be synthesized by a chemical process, biotechnological process, and various other processes. Active pharmaceutical ingredients used for making a wide range of drugs that used to treat chronic diseases such as cancer, metabolic disorders, cardiovascular disorders, and neurological disorders, and others.

Some market players manufacture their own API and others buy from other API manufacturing companies to make drug formulations. Active pharmaceutical ingredient (API) market is driven by various factors such as the increase in the incidence of chronic diseases, and penetration of healthcare systems in underdeveloped countries increased the consumption of drugs are expected to fuel the growth of API market. Furthermore, a surge in healthcare spending, development of healthcare infrastructure around the world enables boost the active pharmaceutical ingredients market growth. However, unfavourable drug pricing policies in some countries and stringent regulatory requirements are hampering the market.

Key Developments

• In June 2017, Bristol-Myers Squibb Company signed a definitive purchase agreement to divest its small-molecule active pharmaceutical ingredient (API) production facility in Ireland, to South Korean firm SK BIOTEK CO. LTD.
• In November 2014, US-based AbbVie has acquired a small molecule active pharmaceutical ingredient (API) manufacturing site in Tuas Biomedical Park, Singapore, to expand global operations of small molecule and biologics manufacturing.