Excipients play an important role in pharmaceutical formulations by adding functionality or by facilitating the processing
of a drug product. Despite this essential role in drug development and commercialization, as with other suppliers to the pharmaceutical
industry, such as producers of raw materials, intermediates, or APIs, excipient manufacturers have to respond to the changing
fundamentals influencing pharmaceutical supply and demand. In reviewing the recent activity of excipient manufacturers, several
trends emerge: increased consolidation based on product-line enhancement or geographic expansion, select investment in emerging
markets, and targeted growth in select product areas.
Patricia Van Arnum
Crunching the numbers
The global excipients market is expected to grow at a moderate pace through 2016 in line with overall pharmaceutical industry
growth. The global pharmaceutical market is expected to reach $1 trillion by 2014 and nearly $1.1 trillion by 2015, according
to the IMS Institute for Healthcare Informatics. The market is projected to increase at a compound annual growth rate (CAGR)
of 3–6% during the next five years, slowing from the 6.2% annual growth rate that occurred during the past five years. For
purposes of this analysis, the pharmaceutical market includes all types of biopharmaceuticals, including biologics, over-the-counter
drugs, and traditional medicines distributed and administered through regulated delivery systems, such as pharmacies, hospitals,
clinics, physician offices, and mail order. Spending figures are reported as ex-manufacturer estimates that do not reflect
off-invoice discounts and rebates (1).
The global excipients market was valued at $4.6 billion in 2010 and is expected to reach $4.9 billion in 2011, according to
a recent report by the market-research firm Business Communications Company (BCC). The global excipients market is expected
to increase to $6.7 billion by 2016, representing a five-year CAGR of 6.5%. In terms of volume, 11.1 billion pounds of excipients
are projected to be consumed in 2011. This level is expected to increase to 14 billion pounds by 2016, representing a CAGR
in volume of 4.6%. BCC cites several factors influencing the global excipients market: concerns in the global pharmaceutical
supply chain, application of quality by design in drug formulation and manufacturing, and overall concern for drug safety.
IMAGE: NICHOLAS EVELEIGH / GETTY IMAGES
BCC segments the market for excipients into three major areas: organic excipients, inorganic excipients, and US Pharmacopeia (USP) water. Organic excipients represent the bulk of the global excipients market, accounting for approximately 93% by value
in 2010. The market for organic excipients was valued at $4.3 billion 2010. It is expected to reach $4.5 billion in 2011 and
$6.3 billion in 2016, representing a five-year CAGR of 6.6%. The market for inorganic excipients was $248 million in 2010.
It is expected to reach $268 million in 2011 and $350 million by 2016, representing a five-year CAGR of 5.5%, according to
BCC. USP water is the smallest segment in the global excipients market. In 2010, the market for USP water accounted for only $88 million. It is projected to increase to $92 million in 2011 and to $114 million by 2016, representing
a five-year CAGR of 4.4%.