Pharmaceutical Excipients Market Overview
The Pharmaceutical Excipients Market size is forecast to reach US$10.4 billion by 2027, after growing at a CAGR of 5.9 % during the forecast period 2022-2027. Generally, Pharmaceutical Excipients refer to substances other than active pharmaceutical ingredients (API) that have been precisely evaluated for safety, and are included intentionally for the purpose of drug delivery in a body. For example, Gelatin and Polyethylene Glycol is commonly used as excipient in the manufacturing of soft gel, hard capsules, ointments, solvents, and more. Likewise, sweetening agents are excipients that are commonly added to pharmaceutical dosage for the purpose of covering the bitter taste of the partially dissolved drug and for improving the palatability of the drug. Cellulose esters are another pharmaceutical excipients that are widely used in osmotic and enteric-coated drug delivery systems. Pharmaceutical Excipients can be further segmented into organic and inorganic chemicals, and can be taken through the oral, topical, or parenteral mode of administration. An increase in demand for medical drugs, and medicines along with increasing uptake of biopharmaceuticals can act as major drivers for the market. Strict rules and regulations regarding the negative effects of the production of pharmaceutical excipients on the environment can act as a major constraint for the market.
There is no doubt that the COVID-19 lockdown has impacted the pharmaceutical excipients industry. Strict lockdowns all over the world interrupted the entire supply and trade of raw materials from manufacturing hubs like China, and India. This, in turn, resulted in slow developments and manufacturing of drugs along with severely affecting multiple companies that primarily depended on outsourcing. However, the pharmaceutical excipients industry started gaining momentum during the end of 2020 due to increasing demand for vaccines and drugs such as Hydroxychloroquine and Remdesivir that were used to fight against COVID-19. For instance, according to a research report published on PLOS medicine, the cumulative volume of antibiotics that were sold in 2020 was about 16,290 million doses. Likewise, Gilead Sciences reported that its total revenue increased by 17% after incorporating the sales of coronavirus treatment Remdesivir. The increasing demand for drugs required for the treatment of COVID-19 along with increasing demand for vaccines to be manufactured in bulk in many countries across the world resulted in the growth of the pharmaceutical excipients industry as it plays a major role in the production of these drugs and vaccines. All of these factors have eventually led to the growth of the pharmaceutical excipients market and it is expected to rise in the upcoming years as well.
Pharmaceutical Excipients Market Segment Analysis – By Administration Route
The Oral Administration Route segment held the largest share in the Pharmaceutical Excipients Market in 2021. The major reason behind this is their wide usage and effectiveness against many illnesses. Initially, healthcare professionals had recommended antiviral drugs as the major mean of protection against COVID-19, especially because of their effectiveness in resolving pneumonia and other respiratory illnesses caused by the virus. For instance, a leading company called Pfizer made an announcement on March 2021, which stated that it has initiated the phase 1 study of novel oral antiviral therapeutic agents to fight against SARS-COV-2. Likewise, on October 2020, another company called Roche also announced its collaboration with Atea Pharmaceuticals in order to develop an orally administered antiviral treatment for COIVID-19 patients, which is currently undergoing Phase 2 clinical trials.
Since these drugs along with many other medical drugs are usually prescribed in large numbers and they are mainly produced in tablet form for oral consumption, the demand for the use of pharmaceutical excipients such as Gelatin, Polyethylene Glycol, Cellulose Esters and Sweetening Agents required for their production is also expected to rise significantly, which can help boost the market growth.
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Pharmaceutical Excipients Market Segment Analysis – By Type
The Organic Chemicals segment held the largest share in the Pharmaceutical Excipients Market in 2021 and is expected to grow at a CAGR of 5.7 % between 2022 and 2027. Most of the pharmaceutical excipients based on organic chemicals include carbohydrates, petrochemicals, oleochemicals, and proteins. These ingredients are an important component of any drugs and they play a major role in fulfilling the purpose of the medication. According to a report published by IMS Institute for Healthcare Informatics, the overall volume of medicines used across the globe reached around 4.5 trillion doses by 2020 with an approximate cost of around $1.4 trillion. As the demand for medical drug production in the pharmaceutical sectors in countries across the globe increases, the demand for the use of organic pharmaceutical excipients are also expected to rise significantly, which can help boost the market growth.
Pharmaceutical Excipients Segment Analysis – By Functionality
The Binders segment held the largest share in the Pharmaceutical Excipients in 2021 and is expected to grow at a CAGR of 6 % between 2022 and 2027. Binder excipients act as an adhesive for holding powders, granules, and other dry ingredients that are responsible to provide mechanical strength to pharmaceutical products. Binder excipients also play a major role during the formulation of drugs or medicines because they improve the bulkiness, disintegration, and dissolution rate of the drug, hence, there has been an increasing demand of these excipients during the manufacturing of drugs and medicines. For instance, according to the data on therapeutic drug use on the U.S. published by the National Centre for Health Statistics, the number of drugs that were ordered and provided through physician office visits reached around 2.9 billion, and the number of drugs that were given or prescribed through hospital emergency department visits reached around 336 million in 2020. Likewise, recent reports published by Kaiser Family Foundation (KFF) show that over 90 million of 246 million U.S. adults fall at a higher risk of serious illness if infected with the coronavirus. Thus, an increased risk of people falling sick or suffering from certain medical illnesses will also increase the demand for medicines or drugs required for the treatment, which can lead to an increase in demand for binder pharmaceutical excipients required for the production of medical drugs. This, in turn, will play a major role in leading market growth in the upcoming years.
Pharmaceutical Excipients Market Segment Analysis – By Geography
The Asia Pacific held the largest share in the Pharmaceutical Excipients in 2021 up to 30%. A recent study indicates that the total sales revenue of traditional pharmaceuticals in China amounted to about $28.8 billion in 2019 and is expected to increase in the upcoming years. Likewise, recent reports from India Brand Equity Foundation (IBEF) reveal that the Indian pharmaceutical sector supplies over 50% of the global demand for various vaccines, 40% of the generic demand for the US, and 25% of all medicines for UK during the ongoing COVID-19 pandemic. It also states that India holds the second-largest share of the pharmaceutical and biotech workforce in the world. According to the Indian Economic Survey 2021, the domestic pharmaceutical market is estimated to grow 3x in the next decade. Similarly, under Union Budget 2021-22, the Ministry of Health and Family Welfare has been allotted INR 73,932 crore (US$ 10.35 billion) and the Department of Health Research has been allotted INR 2,663 crore (US$ 365.68 billion). The government allotted INR 37,130 crore (US$ 5.10 billion) to the ‘National Health Mission’.
India plans to set up a nearly INR 1 lakh crore (US$ 1.3 billion) fund to provide a boost to companies to manufacture pharmaceutical ingredients domestically by 2023. Hence, in this way an increase in demand of medicines and drugs from pharmaceutical sectors across multiple countries will eventually lead to an increase in demand for pharmaceutical excipients such as Gelatin, Polyethylene Glycol, Cellulose Esters and Sweetening Agents required for their production as well, thus, leading to market growth.
Pharmaceutical Excipients Market Drivers
An increase in demand for medical drugs and medicines is most likely to increase demand for the product
According to a recent study published on JAMA Network, there has been an increase in demand for drugs from public hospitals globally in comparison to the pre-COVID-19 period. It states that drugs like Azithromycin, Hydroxychloroquine, Corticosteroids, and Heparin has increased by 11.45%, 6.14%, 24.68%, and 49.05% respectively. With the increasing demand for medical drugs and medicines, the demand for pharmaceutical excipients required for the production of these medical drugs will also significantly increase, thus, leading to market growth in the upcoming years.
Increasing uptake of biopharmaceuticals is most likely to increase demand for the product
The popularity of Biopharmaceuticals has been gradually increasing in the healthcare industry. The major reason behind this is their significant similarities to natural biological compounds that are found in the human body, thus, offering high efficiency with minimum side effects. They are also considered to be one of the fastest-growing segments of the pharmaceutical sector.
Since biopharmaceutical products have high efficiency and provide optimum safety, their ability to address conditions that were previously considered untreatable have significantly resulted in the growth of biopharmaceutical drugs across many countries. For instance, according to a recent article published on Biosimilar Development, new candidates on Biopharmaceuticals are emerging in countries like China and India. It also states that China alone has more than 150 biomanufacturing facilities. Likewise, recent publications made by Biopharminternational states that the Indian vaccine sales are responsible for about 43% of the country’s total biopharmaceutical sales, compared to 16% for diagnostics and 13% for therapeutics. In this way, an increase in Biopharmaceutical sectors will also increase the demand for pharmaceutical excipients required for the production and manufacturing of biopharmaceutical drugs and products, hence, boosting the market growth in the upcoming years.
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Pharmaceutical Excipients Market Challenges
Strict environmental regulations can cause an obstruction to the market growth
Strict rules and regulations regarding the negative effects of the production of pharmaceutical excipients on the environment can act as a major constraint for the market. These include regulation and initiatives taken by industrial associations in order to set standards for the management of an organization’s environmental impacts, product certification and issuance of licenses to decrease the harmful impact on the environment and adoption of clean technologies, and improvement in management practices under CREP (Corporate Responsibility for Environmental Protection) Programs formulated by the Central Pollution Control Board. However, several governments are spending on research and development in order to reduce environmental pollution associated with the pharmaceutical excipients industry.
Pharmaceutical Excipients Industry Outlook
Technology launches, acquisitions, and R&D activities are key strategies adopted by players in this Market. Pharmaceutical Excipients top companies include:
- Ashland Global Holdings
- BASF SE
- Roquette Feres
- Evonik Industries AG
- Associated British Foods
- Archer Daniels Midland Company
- Lubrizol Corporation
- Croda International
- In 2020, Evonik launched an advanced oral drug delivery technology called EUDRATEC Fasteric. This claimed to provide enteric protection which is followed by a rapid, homogeneous release in order to effectively target the upper small intestine. It releases on average 90% of its dose within 30 minutes of arrival at a pre-defined pH level between 3.0 and 5.5. This new technology is capable of increasing gastric resistance and improving the overall intestinal absorption for oral drug products.
- In 2019, Ashland launched Aquarius Nutra TF, which provides titanium oxide-based coating to tablets in the European market. Aquarius Nutra TF is a fully formulated, immediate release, aqueous film coating system that is primarily made for nutritional and dietary supplement products.
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- Binders under Functionality Segmentation in Pharmaceutical Excipients Market is expected to see the fastest growth, especially during the forecast period. The major reason behind this is the increasing demand and consumption of various medical drugs across the world.
- In 2019, the UNDESA published a report, which showed that the majority of the elderly population (approx. 703 billion) have a weaker immune system, hence, they tend to fall sick quite often. This increases the demand for binder excipients required for the production of medical drugs and medications, hence, leading to market growth.
- The Asia Pacific is expected to account for the largest share in the Pharmaceutical Excipients Market. The major reason behind this is the rising requirement and demand for medical drugs and vaccines that has specifically seen a surge after the increase of COVID-19 cases around the world.
- According to the recent report published by the OCHA, around 54 million COVID-19 cases have been recorded across countries in the Asia-Pacific region. This has significantly increased the demand for pharmaceutical excipients required for the production of medical drugs and medications required for the treatment, hence, leading to market growth.
- New environmental-friendly methods are being employed in order to reduce the negative effects of the production of pharmaceutical excipients on the environment.
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