Attractive market trends

Long-term forces across our markets remain attractive. As a global supplier of generic APIs and backed by our deep understanding of the processes involved in the development and manufacturing of innovative APIs, we are well-positioned to capitalise on these trends.

Growing generics market

The global generic drugs market size was valued at US$ 439.37 billion in 2022 and is projected to reach around US$ 670.82 billion by 2030, growing at a CAGR of 5.4% over this period. The continued importance of generics in healthcare will drive the demand for generic APIs.

5.4% CAGR of the global generics market over 2022-30

Growing API CDMO market

The global API Contract Development & Manufacturing Organization (CDMO) market size was estimated at US$ 92 billion in 2022 and is expected to reach US$ 169.14 billion in 2032, growing at a CAGR of 7% over this period. Innovator companies are increasingly outsourcing drug research and manufacturing activities to CDMOs to access valuable expertise, reduce turnaround times, and avoid large capital investments. This trend is leading to a higher demand for companies that offer API CDMO services.

7% CAGR of the global API CDMO market over 2022-32

Growing innovation by emerging biotech companies

Drug development by emerging biopharmaceutical companies (EBPs) is rising rapidly. EBPs spearheaded two-thirds of the R&D pipeline in 2022, up from 51% in 2017 and one-third in 2002. Further, novel drugs developed by EBPs are also being launched by them more often. In 2022, 69% of the 26 EBP-originated New Active Substances (NAS) launches in the U.S. were launched by an EBP. As internal capacity and capability is generally limited for EBPs, they have a high propensity to outsource the development and manufacturing of their lead candidates. Outsourcing is also a strategic activity for EBPs to access specialised expertise, accelerate time to market, and decrease financial risks.

2/3 EBPs’ share in the R&D pipeline in 2022

1https://www.precedenceresearch.com/generic-drugs-market 2https://www.reportsanddata.com/press-release/

3Global Trends in R&D 2023, IQVIA Institute
4Global Trends in R&D 2023, IQVIA Institute

Encouraging approval trends for small molecules

In 2022, 22 of the 37 new drug approvals were small molecules, representing 59% of new drug approvals while the balance 41% represented biologics . While the share of small molecules in new drug approvals was considerably lower than the previous years, a key reason was the overall decline in new drug approvals in 2022. Notwithstanding this aberration, the approval trend for small molecules has been steady and encouraging. In 2021, small molecules represented 72% of new drug approvals, 75% in 2020, 79% in 2019, and 71% in 2018. Further, biotech companies are more aggressive in focusing on small molecules vis-à-vis large pharmaceutical companies. The interplay of these factors is expected to boost the opportunities for API CDMO service providers.

74% Average share of small molecules in new drug approvals between 2018 and 2021

5DCAT Value Chain Insights published on February 2, 2023