The overall trends of increased globalization, generic-drug incursion, and the rising importance of emerging markets can be further seen in the demand and supply patterns of the API market. In keeping with overall pharmaceutical industry trends, recent growth in the global API market has slowed although the overall market is still increasing at a moderate pace. Led by India and China, Asia Pacific has had the highest recent growth in the API market although North America and the US remain the largest markets, respectively, on a regional and country basis. Generic APIs are outpacing growth for branded, innovator APIs. On a global supply basis, China remains the largest producer of generic APIs, largely for its domestic market as well as the largest exporter of APIs on global basis, primarily to emerging markets. Italy retains its historical position as the largest supplier of generic APIs to both Western Europe and the US although India’s position as a supplier to developed markets is on the rise.
On an absolute basis, however, North America is still the largest API market (including both captive and merchant markets) followed by Asia Pacific, although Asia Pacific is gaining ground. The North American share of the global API market declined three percentage points between 2008 and 2012 as the share of Asia Pacific increased. North America’s share was 43% in 2012, down from 46% in 2008. Asia Pacific’s share was 28.3% in 2012, up from 24.2% in 2008, according to the CPA report (1). The US remains the largest global market on a country basis, accounting for 39.7% of the global API market in 2012.
These market positions change, however, if looking at the generic API merchant market alone. Led by China, Asia Pacific accounted for 39.6% of the global generic API merchant market in 2012. China is the largest consumer on a country basis of generic APIs in the merchant market, accounting for 23.7% of the global total, surpassing the North American market as a whole (21.9%) and the US (20.4%). Between 2008-2012, China registered the fastest annual average growth rate in the generic API merchant market at 13.2%, followed by India at 11.9%. Collectively, the two countries accounted for 29.7% of the global generic API merchant market, according to the CPA report (1).