Production of Active Pharma Ingredients (API)
Azithromycin, Cefixime, Telmisartan, Diclofenac Sodium, Acecloflenac Manufacturing. Production of Active Pharma Ingredients (API). Opportunities for Entrepreneurs to Start Own Industry.
The active pharmaceutical ingredient (API) is the part of any drug that produces the intended effects. Some drugs, such as combination therapies, have multiple active ingredients to treat different symptoms or act in different ways.
Active pharmaceutical ingredients are the active substances that are used in the manufacture of a drug and have a pharmacological effect. They provide health benefits and play a vital role in disease diagnosis, prevention, and treatment. Active pharmaceutical ingredients may be synthesized either chemically or through biotechnological methods.
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Active Pharmaceutical Ingredient (API) is the portion of drug that generates intentional effects. APIs are biologically and chemically active constituents of medicines with direct effect in mitigation, prevention, cure and treatment of diseases. Some of the medicines like combination therapies have many active ingredients to treat diverse symptoms or perform in numerous ways. Active Pharmaceutical Ingredient has active ingredient that is contained in medicine. For illustration, an active ingredient to reduce pain is incorporated in a painkiller. A slight amount of the active ingredient has result thus only small part of the active ingredient is confined in medicine.
Role of Government towards API
The coronavirus outbreak disrupting supply of active pharmaceutical ingredients (APIs) and medical devices from China to India, the government has come out with four schemes worth Rs 13,760 crore to encourage manufacturing of bulk drugs and medical devices in the country and their exports.
On March 21, the Union Cabinet under the chairmanship of Prime Minister Narendra Modi had approved an expenditure of Rs. 9,940 crore and Rs. 3,820 crore for APIs and medical devices, respectively.
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The Cabinet also approved a scheme on promotion of bulk drug parks for financing common infrastructure facilities in three bulk drug parks with financial implication of Rs. 3,000 crore for next five years. The government will give grants-in-aid to states with a maximum limit of Rs. 1,000 crore per bulk Drug Park. Parks will have common facilities such as solvent recovery plant, distillation plant, power and steam units, common effluent treatment plant etc.
The government further approved production linked incentive (PLI) scheme for promotion of domestic manufacturing of critical KSMs/drug intermediates and APIs in the country with financial implications of Rs. 6,940 crore for next eight years.
Financial incentive will be given to eligible manufacturers of identified 53 critical bulk drugs on their incremental sales over the base year (2019-20) for a period of 6 years.
Out of 53 identified bulk drugs, 26 are fermentation based bulk drugs and 27 are chemical synthesis based bulk drugs.
Rate of incentive will be 20 per cent (of incremental sales value) for fermentation based bulk drugs and 10 per cent for chemical synthesis based bulk drugs.
The PLI scheme will lead to expected incremental sales of Rs. 46,400 crore and significant additional employment generation over eight years.
The drug industry has welcomed the incentives offered by the government to promote API units in India.
Besides APIs, the Cabinet also approved the scheme for promotion of medical device parks in the country in partnership with the states. A maximum grant-in-aid of Rs. 100 crore per park will be provided to the states. It will have financial implications of Rs. 400 crore.
The PLI scheme for promoting domestic manufacturing of medical devices will have financial implications of Rs. 3,420 crore for next five years.
Medical device is a growing sector and its potential for growth is the highest among all sectors in the healthcare market. It is valued at Rs. 50,026 crore for 2018-19 and is expected to reach to Rs. 86,840 crore by 2021-22. India depends on imports up to an extent of 85 per cent of total domestic demand of medical devices.
Union Cabinet scheme on Promotion of Bulk Drug Parks
- The scheme on Promotion of Bulk Drug Parks for financing Common Infrastructure Facilities in 3 Bulk Drug Parks with financial implication of Rs. 3,000 crore for next five years.
- Production Linked Incentive (PLI) Scheme for promotion of domestic manufacturing of critical KSMs/Drug Intermediates and APIs in the country with financial implications of Rs6,940 crore for next eight years.
Details:
Promotion of Bulk Drug Parks
- Decision is to develop 3 mega Bulk Drug parks in India in partnership with States.
- Government of India will give Grants-in-Aid to States with a maximum limit of Rs. 1000 Crore per Bulk Drug Park.
- Parks will have common facilities such as solvent recovery plant, distillation plant, power & steam units, common effluent treatment plant etc.
- A sum of Rs. 3,000 crore has been approved for this scheme for next 5 years.
Production Linked Incentive Scheme
- Financial incentive will be given to eligible manufacturers of identified 53 critical bulk drugs on their incremental sales over the base year (2019-20) for a period of 6 years.
- Out of 53 identified bulk drugs, 26 are fermentation based bulk drugs and 27 are chemical synthesis based bulk drugs.
- Rate of incentive will be 20 % (of incremental sales value) for fermentation based bulk drugs and 10% for chemical synthesis based bulk drugs.
- A sum of Rs. 6,940 crore has been approved for next 8 years.
Market Outlook
Active Pharmaceutical Ingredients Market Dynamics
The growing cases of chronic diseases are one of the leading causes of hospitalization, and a majority of the patients with these conditions may need re-admission in hospitals due to infection leading to other chronic diseases. For instance, according to the report published by the Centers for Disease Control and Prevention (CDC), nearly 92.1 million adults in the US dealt with at least one type of cardiovascular disease in 2017. Besides, CDC has also stated that out of the total annual healthcare expenditure, i.e., USD 27 trillion, 86% is for the people with chronic health conditions in the US. Some of the prime factors spurring the growth of the market are increasing occurrences of cardiovascular, oncology, lifestyle and diabetes diseases, intensifying number of diagnostic centers and hospitals and escalating elderly population in emerging countries. Furthermore, cumulative healthcare spending, growing disease responsiveness and education are propelling the growth of the market.
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With advancements in healthcare infrastructure, healthcare spending has increased over time. This augmenting focus on healthcare spending positively influences the market for active pharmaceutical ingredients. The high adoption rate of generic drugs in developed and developing economies is fueling the growth of the market. Another positive impact comes from the high demand for specialty medicines which is anticipated to escalate the spending in the pharmaceutical sector. Developed nations are expected to exhibit faster growth in these spending as compared to the developing economies on the back of factors such as the presence of adequate manufacturing units, transparent pricing, and higher spending power.
Specialty medicines a trend in the active pharmaceutical ingredients market
A higher generic adoption rate in developed countries that ranges from 27% to 32% is driving global medicine spending and aiding greater access to improved, lifesaving healthcare services. The adoption of branded generic drugs is predicted to be higher in emerging economies such as China and India and generic drugs accounted for nearly 80% of the total drugs sold by value in these fast-growing nations in 2016. Rising use of specialty medicines is anticipated to grow the pharmaceutical spending worldwide with quicker growth in richer, developed nations as compared to their emerging counterparts. This is primarily because the former have adequate manufacturing units, a higher spending power, and greater emphasis on transparent pricing by assessing measuring effects on the population.
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Active pharmaceutical ingredient (API), is the term that is used to refer to the biologically active component of a drug (e.g. tablet, capsule). A drug is usually composed of several components. The API represents the primary ingredient. Other ingredients are commonly known as “excipients. Sometimes a drug can contain several APIs and its effect on a patient depends on the dosage prescribed and can vary from person to person. In combination therapies, two or more than two active ingredients are used to treat different symptoms in different ways. Stringent quality control is a mandate when it comes to the manufacturing of drugs as the API represents the main component considered while making the prescription.
The global active pharmaceutical ingredient market size is expected to reach a value of USD 286.6 billion by 2027, registering a CAGR of 6.7% over the forecast period. Factors, such as increasing preference for outsourcing APIs and growing prevalence of various target diseases such as cancer and Cardiovascular Diseases (CVDs) are expected to drive the market growth.
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The major factors driving the overall growth of the APIs market in this region include the growing incidence of preventable chronic diseases, increasing government focus on generic drugs, rising demand for biologics and specialty drugs, and technological advancements in the manufacturing processes of APIs.
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This market segment is expected to grow at a modest rate due to a combination of economic and healthcare severity measures and the introduction of low-cost, generic versions of branded drugs.
Key Players:-
Alpha Remedies Ltd.
Ankur Drugs & Pharma Ltd.
Aurobindo Pharma Ltd.
Cian Healthcare Ltd
Cipla Ltd.
Dr. Reddy’S Laboratories Ltd.
Farmson Pharmaceutical Gujarat Pvt. Ltd.
Glaxosmithkline Pharmaceuticals Ltd.
Indoco Remedies Ltd.
Pan Drugs Ltd.
Piramal Enterprises Ltd.
Sanofi India Ltd.
Sri Krishna Pharmaceuticals Ltd.
Teva Pharmaceutical & Chemical Inds. India Pvt. Ltd.
Triton Laboratories Ltd.