North America Active Pharmaceutical Ingredients Market Size, Share & Trends Analysis Report By Type Of Synthesis (Biotech, Synthetic), By Type Of Manufacturer (Captive, Mesrchant), By Type, By Application, By Type Of Drug, By Country, And Segment) - Industry Analysis, Share, Growth, Regional Outlook and Forecasts, 2024-2033

The North America active pharmaceutical ingredients market size was valued at USD 91.60 billion in 2023 and is projected to surpass around USD 146.39 billion by 2033, registering a CAGR of 4.8% over the forecast period of 2024 to 2033. 

Key Takeaways:

• North America accrued the largest revenue share of 38.13% in 2023.
• U.S. led the market with a share of 91.89% in 2023.
• Canada is projected to depict the fastest growth rate over the forecast period.
• The synthetic segment held the largest revenue share of 72.9% in 2023.
• Biotech API is expected to witness fastest growth during the forecast period.
• Captive APIs segment held the largest market share of 51.21% in 2023.
• Merchant APIs segment is expected to experience the fastest growth over the forecast period.
• Innovative APIs segment dominated the overall API market with a revenue share of 67.15% in 2023.
• Cardiology segment dominated the API market with a revenue share of 21.14% in 2023.
• Oncology segment is anticipated to grow at the fastest rate over the forecast period.
• Prescription dominated the market with a revenue share of 81.19% in 2023.
• OTC segment is expected to depict the fastest growth over the forecast period.

North America Active Pharmaceutical Ingredients Market Overview

The North America Active Pharmaceutical Ingredients (API) market is characterized by a robust landscape driven by various factors. One of the key drivers is the rising incidence of chronic ailments like cancer, diabetes, and cardiovascular diseases. This surge in health issues is creating a heightened demand for APIs, which serve as the fundamental building blocks for numerous pharmaceutical formulations. Additionally, the region's aging population is contributing to the market's growth trajectory, as it necessitates the development of innovative medications to cater to evolving healthcare needs. Technological advancements in manufacturing processes are also playing a pivotal role by enhancing the efficiency and quality of API production. Consequently, pharmaceutical companies are increasingly investing in these technologies, further stimulating market expansion. Moreover, supportive government initiatives aimed at promoting domestic manufacturing and reducing reliance on imports are bolstering the North America API market. Collectively, these factors underscore a promising outlook for the North America Active Pharmaceutical Ingredients market, presenting significant opportunities for industry stakeholders.

North America Active Pharmaceutical Ingredients Market Report Scope

North America Active Pharmaceutical Ingredients Market Growth

Increasing prevalence of infectious diseases and hospital-acquired infections coupled with growing prevalence of lifestyle induced conditions is one of the high impact rendering drivers of active pharmaceutical ingredients (API) market.

Lifestyle significantly affects the mental and physical health of human beings. The increasing adoption of unhealthy behaviors such as smoking, physical inactivity, and an unhealthy diet, along with the rising cases of hospital-acquired infections, are factors expected to propel market growth. According to the Canadian Patient Safety Institute, approximately 8,000 patients in Canada die due to hospital-acquired infections, and about 220,000 patients are infected with such diseases. Moreover, the prevalence of stroke is rapidly increasing in the region. The Centers for Disease Control and Prevention (CDC) reports that about 795,000 people in the U.S. suffer from stroke yearly, with 87% being ischemic stroke. Hence, the demand for drugs such as thrombolytic agents for treatment is expected to increase significantly.

In the wake of COVID-19 pandemic and broader reshoring of API production, there is now a stronger emphasis on bringing clinical product supply security back to the U.S., where clinical studies are conducted. Increasing government initiatives to support API production for securing a robust supply of raw materials for pharmaceutical production is expected to drive market growth. The government has devised regulatory changes and announced policies to aid in API manufacturing facility setup. For instance, in June 2021, policy changes were recommended by the Biden Administration to reduce dependence on imports, boosting API production in the U.S. Moreover, in September 2022, President Biden launched the National Biomanufacturing & Biotechnology initiative to provide new investments and resources in the country.

U.S. Active Pharmaceutical Ingredients Market By Type Of Synthesis Insights

The synthetic segment held the largest revenue share of 72.9% in 2023. Major driver for synthetic API market is high demand for generic drugs. APIs used to develop generic drugs contribute to high revenue for synthetic and chemical API manufacturing companies. This is creating a wide opportunity for CDMOs. An increase in outsourcing trend for improving profitability by reducing the cost of production is creating new growth avenues for the market.

Biotech API is expected to witness fastest growth during the forecast period. Growth of biotech API segment can be attributed to rising investments in biopharmaceutical and biotechnology sectors. This allows innovation of new molecules that aid in treating diseases such as cancer. Key players are highly focused on biotech APIs owing to high revenue generation and profitability. Some of the technological advancements in biotech API manufacturing include single-use bioreactors, which are made of plastic and have been sterilized and sealed with gamma radiation.

U.S. Active Pharmaceutical Ingredients Market By Type Of Manufacturer Insights

Captive APIs segment held the largest market share of 51.21% in 2023. Numerous companies are investing in solving challenges and developing new chemical ways for in-house production of APIs. This aids in reducing costs and the risk of contamination. Protein synthesis and artificial intelligence are expected to accelerate development with greater control over the process. Furthermore, recent initiatives and developments by key players indicate a strong preference for in-house manufacturing over outsourcing. For instance, in September 2021, AstraZeneca announced an investment of USD 360 million in its API manufacturing facility in Ireland to commercialize novel products. Such initiatives undertaken by key players are anticipated to boost segment growth.

Merchant APIs segment is expected to experience the fastest growth over the forecast period. Contract manufacturing and outsourcing of API molecule development are growing trends in the pharmaceutical sector. As captive production of APIs is expensive, companies have started opting for outsourcing to minimize expenses. Merchant APIs eliminate the need for investing in expensive equipment and sophisticated infrastructure. Post-pandemic, key companies are expanding their capacities to enhance their market presence. For instance, in May 2023, MilliporeSigma announced the expansion of its U.S.-based facility, with an investment of USD 69 million, doubling its manufacturing capacity for Highly Potent Active Pharmaceutical Ingredient (HPAPI). The facility is dedicated to the development and commercial manufacturing of Antibody Drug Conjugates (ADCs).

U.S. Active Pharmaceutical Ingredients Market By Type Insights

Innovative APIs segment dominated the overall API market with a revenue share of 67.15% in 2023. Furthermore, it the segment is also anticipated to grow at the fastest CAGR. Furthermore, the segment is also anticipated to grow at the fastest CAGR. The growth is attributed to an increase in funding and favorable regulations for R&D facilities. Many novel innovative products are now in the pipeline due to extensive research in this field and are expected to be launched in the near future. Furthermore, increasing support from regulatory agencies for the approval of new drugs is projected to facilitate market growth, which can be attributed to an increase in the focus of the government on healthcare and pharmaceuticals due to COVID-19.

U.S. Active Pharmaceutical Ingredients Market By Application Insights

Cardiology segment dominated the API market with a revenue share of 21.14% in 2023, attributable to the rising prevalence of cardiovascular diseases. Cardiovascular disease is one of the world's most serious public health problems, prompting extensive research into APIs in the field. Government initiatives, such as the National Cholesterol Education Program, are aimed at raising awareness related to lipid and cholesterol-related diseases. These programs also support medication-based awareness. High prevalence and increasing awareness about cardiovascular diseases are anticipated to boost segment growth over the forecast period, driving the demand for APIs for cardiology drugs.

Oncology segment is anticipated to grow at the fastest rate over the forecast period. Increasing prevalence of cancer is a key factor driving this market. Collaboration among pharmaceutical companies, research institutions, and regulatory entities remains pivotal in expediting drug development, ensuring patient safety, and fostering innovation. For instance, in March 2023, Pfizer Inc. and Seagen Inc. confirmed a definitive merger agreement. Through this strategic deal, Pfizer planned to acquire Seagen, a renowned biotech firm specializing in revolutionary cancer treatments. The agreement includes a cash transaction of USD 229 per Seagen share, resulting in an enterprise value of USD 43 billion.

U.S. Active Pharmaceutical Ingredients Market By Type Of Drug Insights

Prescription dominated the market with a revenue share of 81.19% in 2023. The uptake of prescription drugs is largely dependent on physicians’ prescriptions. Use of prescription drugs, such as Proton Pump Inhibitors (PPI), in the management of general conditions, heartburn, has plateaued owing to several adverse effects. However, Histamine-2 Receptor Antagonist (H2RA) prescription rate has been impacted. Prescription drugs dominated in oncology segment as cancer is primarily treated using chemotherapy, targeted therapy, immunotherapy, and hormonal therapy. The use of biology is also increasing.Due to the increased efficacy of novel targeted therapies, the number of prescriptions for targeted therapies is rapidly increasing. Furthermore, major players are launching novel targeted therapies.

OTC segment is expected to depict the fastest growth over the forecast period. OTC products are easily accessible to the population and is frequently impacted by changes in consumer behavior. Consumer preference is shifting from use of antacids for heartburn to ensuring gut health by taking probiotics. This paradigm shift is creating greater opportunities for preventive products, such as health supplements, nutraceuticals, and probiotics, while slashing the growth of existing products.

U.S. Active Pharmaceutical Ingredients Market By Country Insights

North America accrued the largest revenue share of 38.13% in 2023 owing to rising prevalence of cardiovascular, genetic, and other chronic diseases aided with growing research in field of drug development. The region shows high value manufacturing areas, including complex & high potent APIs, gene therapies & biologicals, which is expected to provide relative growth. Moreover, there is significant expansion of innovators and CDMOs seen in the region, which is creating an added advantage for manufacturing and commercializing APIs.

U.S. Active Pharmaceutical Ingredients Market Trends

U.S. led the market with a share of 91.89% in 2023. Presence of key players such as AbbVie Inc.; Curia; Pfizer Inc. (Pfizer Center One); Viatris Inc.; and Fresenius Kabi AG is positively influencing the market growth. For instance, in February 2022, Viatris received FDA approval for Generic Restasis—a cyclosporine ophthalmic emulsion for the treatment of dry eye disease.

Canada Active Pharmaceutical Ingredients Market Trends

Canada is projected to depict the fastest growth rate over the forecast period. The growing interest of key players in entering the Canadian market is opportunistic for the market growth. For instance, in March 2022, Viatris Inc., in collaboration with Biocon, launched oncology biosimilar Abevmy in Canada. Moreover, in July 2021, MediPharm Labs received a license from Health Canada for manufacturing and sale of cannabis API in Canada. In January 2021, 5N Plus, Inc. announced its expansion into the API segment to include new class of antibiofilm and antibiotic drugs.

Key North America Active Pharmaceutical Ingredients Company Insights

AbbVie Inc., Pfizer Inc., and Viatris Inc. are some of the key companies in the market. Presence of pipeline products in the API market is expected to launch in the coming years and is anticipated to drive market growth. Further, increasing outsourcing activities due to high manufacturing costs and stringent regulations on the production of APIs are expected to maintain the competitive rivalry at a high level during the forecast period.

• In October 2023, Cambrex announced the completion of its USD 38 million small molecule API manufacturing facility. This investment doubled the size of the company’s manufacturing facility and enhanced its ability to acquire more customers to meet their evolving needs.
• In August 2023, BARDA and Regeneron entered into an agreement wherein the former will support the latter in developing an antibody therapy to prevent SARS-CoV-2. This contract is worth USD 326 million and is anticipated to drive the market with production of novel vaccines in the coming years.
• In April 2023, Eli Lilly announced an investment of USD 1.6 billion in U.S.-based LEAP Innovation Park. This brings the total investment to USD 3.7 billion to manufacture complex APIs for products such as genetic medicine.
• In April 2022, Geocann entered into a strategic partnership with Averix Bio for supplying API phytocannabinoid ingredients.

North America Active Pharmaceutical Ingredients Market Top Key Companies:

• Dr. Reddy’s Laboratories Ltd.
• Sun Pharmaceutical Industries Ltd.
• Teva Pharmaceutical Industries Ltd.
• Cipla Inc.
• AbbVie Inc.
• Aurobindo Pharma
• Sandoz International GmbH (Novartis AG)
• Viatris Inc.
• Fresenius Kabi AG
• STADA Arzneimittel AG
• Lonza
• Curia
• Pfizer Inc.
• Bristol-Myers Squibb Company
• Merck KGaA
• Catalent, Inc.

North America Active Pharmaceutical Ingredients Market Report Segmentation

This report forecasts revenue growth at country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2021 to 2033. For this study, Nova one advisor, Inc. has segmented the North America Active Pharmaceutical Ingredients market.

By Type of Synthesis 

• Biotech
  • By Biotech APIs Market, by Type 
    • Generic APIs
    • Innovative APIs
  • By Biotech APIs Market, by Product 
    • Monoclonal Antibodies
    • Hormones
    • Cytokines
    • Recombinant Proteins
    • Therapeutic Enzymes
    • Vaccines
    • Blood Factors
• Synthetic
  • By Synthetic APIs Market, by Type 
    • Generic APIs
    • Innovative APIs

By Type of Manufacturer 

• Captive APIs
• Merchant APIs

By Type 

• Generic APIs
• Innovative APIs

By Application 

• Cardiovascular Diseases
• Oncology
• CNS and Neurology
• Orthopedic
• Endocrinology
• Pulmonology
• Gastroenterology
• Nephrology
• Ophthalmology
• Others

By Type of Drug 

• Prescription
• OTC

By Country 

• U.S.
• Canada