Report

The United Kingdom Active Pharmaceutical Ingredients (API) market is expected to register a CAGR of 6.3% over the forecast period.

The COVID-19 pandemic negatively impacted the entire pharmaceutical supply chain, along with disrupting the supply of APIs from India and China. The lockdown measures and restrictions imposed by the government to avoid spreading coronavirus led to shortages of active pharmaceuticals and essential drugs in the country. The demand for approximately 20 drugs, including drugs used for treating COVID-19, such as analgesics and paracetamol, increased in the country. However, with released restrictions and resumed import-export activities, the demand for API in the United Kingdom is expected to increase over the forecast period.

The factors contributing to the market's growth include the increasing prevalence of infectious, genetic, cardiovascular, and other chronic disorders, the growing geriatric population, the rising prevalence of cancer, and the expanding sophistication in oncology drug research. According to the British Heart Foundation England Factsheet published in January 2022, about 6.4 million people live with cardiovascular diseases in England. Also, as per the British Heart Foundation 2020 fact sheet, around 7.4 million people suffer from heart and circulatory diseases in the United Kingdom.

Also, the report published by the United Kingdom Health Security Agency in December 2022 stated that in 2020, an estimated 97,740 people were HIV positive in England. An estimated 4,660 in 2020 were unaware of their infection. Such rising numbers indicate the demand for antiretroviral (ARV) active pharmaceutical ingredients (APIs) and formulations, anticipated to augment the market growth over the forecast period.

Similarly, as per the NICE in 2021, around 1,45,000 people have PD in the United Kingdom, which is expected to increase by nearly a fifth to 172,000 by 2030. Thus, the expected increase in the number of patients suffering from PD is anticipated to fuel the demand for effective drugs, which is anticipated to augment the market growth over the forecast period.

Diabetes is one of the most prevalent chronic diseases in the region. As per the report from Diabetes UK, published in May 2021, 4.9 million people were living with diabetes in the United Kingdom in 2021. The 2022 statistics published by IDF stated that 3.9 million people were suffering from diabetes in the United Kingdom in 2022. This number is projected to increase to 4.1 million and 4.4 million by 2030 and 2045, respectively. Thus, the high diabetic population in the country raises the company's focus on developing advanced and safe drugs requiring a large amount of API for drug formulation, propelling the market growth.

Furthermore, the rising expenditure on research and development and growing government and company initiatives and investments in developing drugs and therapies in the country is further expected to raise the requirement for APIs, boosting the market growth. For instance, in August 2022, the Parkinson Foundation entered a new international strategic partnership with Parkinson's UK to boost investment in research for new treatments for PD. The Parkinson's Foundation invested a minimum of USD 3 million into the Parkinson's Virtual Biotech for the drug development arm of Parkinson's UK over the next three years.

Moreover, the rising company activities in developing drugs and increasing approvals are also contributing to the market growth. For instance, in May 2022, The United Kingdom's Medicines and Healthcare products Regulatory Agency (MHRA) and South Korea's Ministry of Food and Drug Safety approved biosimilar versions of Genentech's ophthalmology drug, Lucentis (ranibizumab). Also, in January 2021, Sanofi and Kymab, a clinical-stage biopharmaceuticals company that developed fully human monoclonal antibodies with a focus on immune-mediated diseases and immuno-oncology therapeutics, entered into an agreement under which Sanofi acquired Kymab for an upfront payment of approximately USD 1.1 billion and up to USD 350 million upon achievement of certain milestones.

However, the stringent regulations for drug approvals, various drug price policies in the country along with high competition among the API manufacturer are expected to hinder the growth of the active pharmaceutical ingredient market in the United Kingdom over the forecast period.

UK Active Pharmaceutical Ingredients (API) Market Trends

Oncology Segment Expects to Register a High CAGR

Owing to crucial factors, such as the rising prevalence of various types of cancer and increasing company activities in developing drugs, the oncology segment is expected to witness significant growth in the active pharmaceutical ingredient market over the forecast period.

The 2021 statistics published by Breast Cancer Now observed that about 55,000 women are diagnosed with breast cancer in the United Kingdom every year. As per the same source, 46,000 people are diagnosed with breast cancer in England every year, followed by 4,700 in Scotland, 2,800 in Wales, and 1,500 in Northern Ireland. With the growing burden of cancer cases, the demand for oncology drugs is increasing. These drugs need API for drug formulation. Hence, the market is expecting a significant positive impact over the forecast period.

Additionally, the high healthcare expenditure in the country is also contributing to market growth. For instance, as per the data published by OECD, in June 2021, the United Kingdom's health spending as a share of GDP rose sharply, from EUR 257.6 billion (USD 273 billion) in 2020 to EUR 276.6 billion (USD 293.2 billion) in 2021. Thus, the increasing healthcare spending is expected to increase company activities and government initiatives in developing safe and effective treatment drugs. This is anticipated to fuel the demand for APIs, propelling the market growth.

Furthermore, the rising government initiatives in spreading cancer awareness and increasing funding for drug development in the country are expected to augment market growth. For instance, according to news published in July 2021, NHS England announced a new Innovative Medicines Fund (IMF) of EUR 680 million (USD 720.8 million) to fast-track promising new cancer drugs.

Similarly, in August 2022, researchers at the School of Pharmacy, Queen's University Belfast in Northern Ireland, received funding from Breast Cancer Now to develop new treatments for an aggressive form of breast cancer. In this case, Niamh Buckley and Helen McCarthy from the School of Pharmacy secured a GBP 228,900 (USD 278,168) grant from Breast Cancer Now to tackle protein p53 - found at very high levels in around 90% of triple-negative breast cancer tumors.

Therefore, owing to the factors such as the high burden of cancer in the country, rising healthcare expenditure, and growing government initiatives in spreading cancer awareness, the studied segment is anticipated to grow over the forecast period.

Branded Segment Expected to Own Significant Market Share

The branded segment is expected to grow over the forecast period, owing to the factors such as the high burden of chronic, ophthalmic, and other diseases, growing awareness regarding branded drugs among the population, and increasing company activities in developing drugs in the country. For instance, an article published by City, University of London, in May 2022 stated that glaucoma affects around 2% of people aged over 40 years and almost 10% of those over 75 years in the United Kingdom, leading to more than a million hospital visits every year.

In addition, as per the data published by the NHS United Kingdom, in August 2022, about 43,932 cataract procedures were performed in England in November 2021. As per the same source, the number of cataract surgeries is expected to increase by 50% by 2035 due to the increasing aging population and the high prevalence of the condition. Thus, the massive number of eye surgeries is expected to increase the demand for ophthalmic drugs and solutions, further propelling the demand for APIs for their formulation. This is anticipated to fuel the segment's growth over the forecast period.

The rising company activities in developing branded drugs and increasing product launches are also contributing to the market growth. In September 2022, United Kingdom NICE approved Pfizer's palbociclib (Ibrance) in combination with anti-cancer therapy, fulvestrant, to treat advanced breast cancer patients.

Moreover, the rising initiatives, such as expansion by key market players, are expected to increase the company's focus on developing high-quality APIs, which is anticipated to fuel the market growth over the forecast period. For instance, in July 2021, AbbVie expanded its global operations, enabling end-to-end drug substance and product supply for AbbVie CMO manufacturing partners. New AbbVie Contract Manufacturing service offerings include biologics fill-finish, topical creams and ointments, sterile ophthalmic ointments, and custom API. Also, the acquisition of Allergan and capital expenditure enable AbbVie CMO to provide expanded capabilities to clients on several European manufacturing fronts (including the United Kingdom).

Therefore, owing to the factors such as the high burden of eye diseases in the country, increasing branded product launches as well as a growing company focus on facility expansion to grow their API business, the studied segment is anticipated to witness growth over the forecast period.

UK Active Pharmaceutical Ingredients (API) Market Competitor Analysis

The United Kingdom Active Pharmaceutical Ingredients (API) market is fairly fragmented. The API market has several manufacturers that focus on expanding their footprints in the market by adopting various business strategies, such as collaborations, facility expansion, drug approvals, and others. Some of the companies in the market are Pfizer Inc., Novartis AG, BASF SE, Viatris Inc., and Teva Pharmaceutical Industries Ltd.

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