China stands tall in API production and exports

THE Active Pharmaceutical Ingredient (API) is the most important part of any drug. The API, as the name would suggest, is the chemical part of any capsule or tablet that works on the disease condition or symptom. This means that the API is the backbone of the pharmaceutical industry, booming in its own right, as it provides the ingredients for all kinds of medication. As the world's largest API production and exporting country, China can produce thousands of species of chemical raw materials.

- By Dr Biplab Debnath & Sumel Ashique

China currently commands an impressive 20 per cent share of global API production by volume, with approximately 40 per cent of APIs exported worldwide originating from Chinese manufacturing facilities.

The global API is already a billion-dollar industry and the overall market is estimated to be worth around $246 billion by 2025. The API manufacturers' productions are influenced by the human cost, materials prices, exchange rate fluctuations and other factors.

The API market in China is projected to experience significant growth from 2025 to 2030. In 2025, the market size is estimated at US$15.97 billion, and it is expected to reach US$23.32 billion by 2030, reflecting a Compound Annual Growth Rate (CAGR) of 7.86 per cent. The major driving factors of global API market are as follows:

■ Growth in healthcare expenditure

■ Advancements in the technology of API manufacturing

■ Rapidly increasing aging population

■ Increasing importance of generics

■ Increase in abbreviated new drug applications (ANDA)

■ Growth in incidence of chronic diseases

Chemical API segment to dominate market

Chemical APIs are produced through conventional routes of synthesis. They are extensively used in many therapeutic segments such as cardiovascular, central nervous system disorder, oncology, gastrointestinal and so on. The wide usage in these applications ensures the stable growth of the chemical API market.

Chemical APIs have historically dominated the global API market, and this situation is reflected in the Chinese market. China is the world's second-largest producer and exporter of chemical APIs, with competitive advantage mainly in antibiotics, vitamins, antipyretics and analgesics.