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 key 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 prominent trend throughout the forecast period. Nevertheless, the lengthy and costly drug development process poses challenges to market growth.
Excipients are non-active substances utilized as carriers and diluents in pharmaceuticals. These components, distinct from active pharmaceutical ingredients (APIs), are rigorously assessed for safety and are deliberately 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 initiated the Pradhan Mantri Bhartiya Janaushadhi Pariyojana (PMBJP) program to ensure the availability of quality generic medicines at reasonable prices. This initiative established dedicated outlets, known as Janaushadhi Kendras, which provide affordable generic medications. By 2021, there were 8,012 such centers 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 generic versions 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 effectiveness in drug delivery. They significantly impact the manufacturability, visual appeal, efficacy, and patient adherence to the medication. Therefore, the selection of excipients in formulations necessitates a thorough understanding of their quality, safety, and performance characteristics. The primary function of excipients is to enhance patient acceptance, improve stability, bioavailability, and contribute to the overall effectiveness of the drug.
As a result, the increasing sales of generic medications globally are driving the demand for pharmaceutical excipients utilized in the production of these drugs.
The global pharmaceutical excipients market is categorized by type into several segments, including 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, while the plant proteins, polyols, and cyclodextrins segment is projected to exhibit the highest CAGR from 2022 to 2028. The market is also segmented by clinical indication, including 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. India, a major producer of generic medicines (accounting for 20% of the global supply), imports about 70% of its APIs from China. 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 production 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 for growth. Organic strategies primarily involve product launches and approvals, while inorganic strategies include acquisitions, collaborations, and partnerships. These strategies enable market players to broaden their operations and enhance their geographical reach, contributing to overall market expansion. Additionally, acquisitions and partnerships help strengthen customer bases and diversify product offerings. Notable developments by key market players include:
- 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.
Key sources referenced in the preparation of this report include the Parenteral Drug Association (PDA), Centers for Disease Control and Prevention (CDC), Office of Pharmaceutical Quality (OPQ), World Health Organization (WHO), and the European Federation of Pharmaceutical Industries and Associations (EFPIA).