Saurabh Gurnurkar, Executive Director, UQUIFA, talks about the developments in pharma / API industry, what went wrong and what was right
The global Active Pharmaceutical Ingredient (API) market has seen a steady growth in 2018 in terms of volume and value despite disruptions from the conventional supplier base i.e China and India impacting either API availability or economics. Lack of supply or higher price of inputs meant escalation in API prices with a spillover to finished drugs in some cases. The API market is mainly driven by factors such as patent expiration of drugs, increased generic medicine sales and high uptake of biologics. As many as 25-30 drugs have gone off patent in 2018. The API market is segmented by synthesis including synthetic chemicals, HPAPI and biotech API. High Potential Active Pharmaceutical Ingredients (HPAPI) has seen a boom while biotech API lagged behind a bit. This is because HPAPI therapeutic applications in oncology are very effective in treating cancer and other respiratory disorders.
Reasons for dependence on China
China has certain inherent strengths in chemistry, technologies and infrastructural capabilities which they leverage to gain higher market shares.Over a period of time, the Chinese API market has gained high level of market shares given its cost competitiveness.
This has resulted in manufacturing of intermediates and APIs, which moved away from the EU and other parts of the world largely to Asian countries, dominated by Chi