Pharmaceutical Excipients Market Research Report and Outlook by 2028

The pharmaceutical excipients market is projected to expand from US$ 7,825.38 million in 2021 to US$ 12,245.04 million by 2028, reflecting a compound annual growth rate (CAGR) of 6.6% from 2022 to 2028.

This report outlines the prevailing trends and the factors propelling market growth. The expansion of the market is primarily driven by the increasing generics sector and a rise in new product introductions. Furthermore, the application of nanotechnology to enhance the functionality of excipients is anticipated to become a notable trend throughout the forecast period. Nevertheless, the lengthy and costly drug development process poses challenges to market growth.

Excipients are non-active substances that serve as vehicles and diluents for pharmaceuticals. These substances, which are not active pharmaceutical ingredients (APIs), have undergone thorough safety evaluations and are intentionally incorporated into drug delivery systems.

According to the Food and Drug Administration (FDA), approximately 90% of prescriptions in the United States are for generic medications. Governments in developing nations are prioritizing the reduction of healthcare expenses by promoting the production of generic drugs. For example, in November 2008, the Indian Government's Department of Pharmaceuticals initiated the Pradhan Mantri Bhartiya Janaushadhi Pariyojana (PMBJP) to ensure the availability of quality generic medicines at reasonable prices. This initiative established dedicated outlets, known as Janaushadhi Kendras, which provide generic medications affordably. By 2021, there were 8,012 Janaushadhi Kendras operational across India. Additionally, numerous drugs are nearing the expiration of their patents, allowing generic manufacturers to create copies of branded medications once the original patents lapse. These replicas can be priced up to 80% lower than their branded counterparts. Consequently, the generics sector has experienced significant growth over the past decade, as many branded drugs have lost patent protection, leading to substantial returns for shareholders.

Excipients play a crucial role in pharmaceutical formulations, influencing the dosage form's structure and its drug delivery capabilities. They significantly impact the manufacturability, visual appeal, effectiveness, and patient adherence to the dosage form. Therefore, the selection of excipients in a formulation necessitates a thorough understanding of their quality, safety, and performance characteristics. The primary function of excipients is to enhance patient acceptability, improve stability, increase bioavailability, and support overall efficacy.

As a result, the global increase in generic drug sales drives the demand for pharmaceutical excipients utilized in the production of these medications.

The global pharmaceutical excipients market is categorized by type into bioresorbable polymers, lipids, liposome-based formulations, oleochemicals, sugars, cellulose, starches, petrochemicals, plant proteins, polyols, cyclodextrins, inorganic chemicals, and others. In 2021, the inorganic chemicals segment held the largest market share. However, the segment comprising plant proteins, polyols, and cyclodextrins is projected to exhibit the highest CAGR from 2022 to 2028. The market is also segmented by clinical indication into cancer, metabolic disorders, infectious diseases, dental applications, ophthalmic uses, gene therapies, and others. The cancer segment dominated the market in 2021, while the infectious disease segment is expected to see growth during the forecast period. Functionality-wise, the market is divided into coloring and coating agents, sweeteners and flavoring agents, suspending and viscosity agents, preservatives and controlled-release agents, antioxidants and oils, tablet fillers and diluents, binders, compression aids, granulating agents, and others. The tablet filler and diluents segment was the largest in 2021 and is anticipated to continue growing. In terms of application, the market is segmented into parenteral, oral formulations including tablets and capsules, liquid and injectables, physicochemical excipient-container interactions in prefilled syringes, nutraceuticals and OTC products, topical applications, and others. The oral formulations and tablets segment held the largest market share in 2021, while the physicochemical excipient-container interactions segment is expected to grow during the forecast period. By end user, the market is divided into biopharma industries, pharmaceutical industries, animal health, and others, with the pharmaceutical industries segment holding the largest share in 2021, although the biopharma segment is expected to grow in the coming years.

Impact of COVID-19 Pandemic on the Pharmaceutical Excipients Market

The COVID-19 pandemic placed significant strain on the global supply chain for medicines, leading to shortages of raw materials, including active pharmaceutical ingredients (APIs) and excipients. The Council on Foreign Relations reports that a substantial portion of medicines sold in the US is manufactured in China and India, with these countries supplying nearly 80% of the US API demand. As a major producer of generic medications, India, which generates 20% of the global generics supply, relies on China for approximately 70% of its APIs. Consequently, disruptions in this supply chain have resulted in drug shortages. The surge in the development of clinical drugs for COVID-19 has stimulated growth in the pharmaceutical excipients market. However, supply chain interruptions due to prolonged lockdowns in various regions have adversely affected the manufacturing of oral solid dosage forms, significantly impacting the demand for excipients worldwide.

Companies in the pharmaceutical excipients market are employing various organic and inorganic strategies. Organic strategies primarily involve product launches and approvals, while inorganic strategies include acquisitions, collaborations, and partnerships. These strategies enable market participants to broaden their operations and enhance their geographical reach, thereby contributing to overall market growth. Additionally, acquisitions and partnerships help companies strengthen their customer base and expand their product offerings. Notable developments by key market players include the following:

• In May 2022, Avantor announced plans to establish a new manufacturing and distribution hub in Singapore, integrating its existing distribution facility with new manufacturing operations. This hub aims to bring Avantor's services closer to regional customers and enhance global supply chain capabilities, with the facility expected to be fully operational by early next year.

The Parenteral Drug Association (PDA), Centers for Disease Control and Prevention (CDC), Office of Pharmaceutical Quality (OPQ), World Health Organization (WHO), and European Federation of Pharmaceutical Industries and Associations (EFPIA) are among the key primary and secondary sources referenced in the preparation of this report on the pharmaceutical excipients market.