Japan Active Pharmaceutical Ingredient Market Assessment, By Synthesis [Biotech, Synthetic], By Potency [Traditional API, HPAPI], By Manufacturer [Captive APIs, Merchant APIs], By Type [Generic APIs, Innovative APIs], By Drug [Prescription Drugs, Over-the-counter Drugs], By Usage [Clinical, Research], By Application [Cardiovascular diseases, Oncology, Neurology, Orthopedic, Diabetes, Pulmonology, Gastroenterology, Nephrology, Ophthalmology, Others], By Region, Opportunities and Forecast, FY2017-FY2031F

Japan Active pharmaceutical ingredient market size was valued at USD 20.11 billion in FY2023, and is expected to reach USD 32.79 billion in FY2031, with a CAGR of 6.3% for the forecast period between FY2024 and FY2031. The rising prevalence of health disorders, robust healthcare expenditure on R&D of pharmaceutical medications, and progress in biologics technology will drive Japan's active pharmaceutical ingredient market. The rise in the elderly population in Japan has been a major influence on the spread of chronic diseases. The key driver of API market's expansion is the increasing application of APIs in oncology and diabetes. The Japanese API market is highly regulated, and the government plays a significant role in supporting the industry. The government provides subsidies to API manufacturers and invests in research and development. The government is laying several initiatives to promote the use of generic drugs. Japanese pharmaceutical companies are increasingly outsourcing the manufacturing of APIs to contract manufacturing organizations.

Increasing Burden of Chronic Diseases and Growing Geriatric Population

The rising elderly population in Japan, which is more vulnerable to various health issues such as injuries and diseases, has led to a substantial surge in the demand for active pharmaceutical ingredients (APIs). According to data from the Ministry of Internal Affairs and Communications as of September 15, 2022, Japan's total population declined by 820,000 over the past year. Concurrently, the number of individuals aged 65 years and older increased by 60,000, reaching a record high of 36.27 million, reflecting a 0.03% increase from 2021. The rise in chronic disease incidence, such as cancer, diabetes, and cardiovascular diseases, is a primary factor driving the Japanese API market. As per IDF (International Diabetes Federation), there are more than 11 million adults in Japan with diabetes.

Expansion of Production Facilities by Pharmaceutical Companies

Pharmaceutical companies in Japan are aggressively expanding their production facilities to cater to the growing demand in the active pharmaceutical ingredient (API) market. The surge is driven by factors such as the need for a stable supply chain, increasing healthcare requirements, and the government's support for domestic production. Companies are investing heavily in state-of-the-art facilities to ensure high-quality API manufacturing, adhering to stringent regulatory standards. The expansion strengthens Japan's position in the global API market and fosters innovation and economic growth within the pharmaceutical sector, positioning it as a pivotal player in the worldwide pharmaceutical industry.

In October 2023, Chugai Pharmaceutical, based in Japan, announced plans to develop a new bio active pharmaceutical ingredients (APIs) manufacturing facility and injection building at its Utsunomiya Plant, a subsidiary of the Chugai Group. By developing a new facility for intermediate to later-stage manufacturing of investigational pharmaceuticals, including Phase 1 and 2 projects, the new bio-API manufacturing building (UT3) will target the clinical development stage to initial commercial production.

Technological Advancements

Japan has been at the forefront in terms of technological advancement taking place in the active pharmaceutical ingredient (API) market, demonstrating its commitment to innovation and quality. Japanese pharmaceutical companies have made significant strides in research and development, leveraging innovative technologies such as artificial intelligence, robotics, and advanced analytics to accelerate drug discovery and production processes. These advancements have improved the efficiency and precision of API manufacturing and have contributed to the development of novel therapies.

Japan's stringent regulatory standards and dedication to pharmaceutical safety have propelled the country's API industry to a global leadership position. Continuous investment in state-of-the-art manufacturing facilities and adherence to good manufacturing practices have solidified Japan's reputation for producing high-quality APIs.

Impact of COVID-19

Japan API market is primarily influenced by the COVID-19 pandemic, as it led to a rise in health issues. Japan, in response to the heightened demand for vaccines, had significantly increased its consumption of API to facilitate vaccine production. It accelerated the need for domestic API production to ensure a stable supply chain, reducing dependency on foreign sources. The shift towards self-sufficiency in pharmaceutical manufacturing expanded the country's resilience in times of crisis and created new opportunities for Japanese API manufacturers. Additionally, the pandemic prompted increased investment in research and development of APIs, leading to advancements in pharmaceutical innovation and production efficiency. Japanese pharmaceutical companies were at the forefront of vaccine and antiviral drug development, during the pandemic.

Prescription Drugs Account for the Dominant Share

Prescription drugs hold a significant share in Japan API market compared to over the counter (OTC) drugs. The prescription drugs segment accounts for the largest share in the APIs market, as most drugs are sold with a doctor's prescription. The Japanese government has made efforts to promote the use of generic drugs, such as changing prescription forms to make it easier for physicians to allow generic substitution and incentivizing pharmacies with dispensation fees that reward generic usage. These factors contribute to the dominance of prescription drugs in Japan API market.

Report Scope

“Japan Active pharmaceutical ingredient Market Assessment, Opportunities and Forecast, FY2017-FY2031F”, is a comprehensive report by Markets and Data, providing in-depth analysis and qualitative and quantitative assessment of the current state of the Japan active pharmaceutical ingredient market, industry dynamics, and challenges. The report includes market size, segmental shares, growth trends, opportunities, and forecast, between FY2024 and FY2031. Additionally, the report profiles the leading players in the industry mentioning their respective market share, business model, competitive intelligence, etc.

In this report, Japan active pharmaceutical ingredient market has been segmented into the following categories: 

·         By Synthesis

o   Biotech

o   Synthetic

·         By Potency

o   Traditional API

o   HPAPI

·         By Manufacturer

o   Captive APIs

o   Merchant APIs

·         By Type

o   Generic APIs

o   Innovative APIs

·         By Drug

o   Prescription Drugs

o   Over-the-counter Drugs

·         By Usage

o   Clinical

o   Research

·         By Application

o   Cardiovascular Diseases

o   Oncology

o   Neurology

o   Orthopaedic

o   Diabetes

o   Pulmonology

o   Gastroenterology

o   Nephrology

o   Ophthalmology

o   Others

·         By Region

o   North [Hokkaido and Tohoku]

o   Central [Kanto and Chubu]

o   South [Kansai, Chugoku, Shikoku, and Kyushu & Okinawa]

Key Players Landscape and Outlook

The active pharmaceutical ingredients market in Japan exhibit considerable fragmentation. Numerous API manufacturers are actively pursuing the expansion of their presence through diverse business strategies, including partnerships, facility expansion, and obtaining drug approvals. In March 2022, Sumitomo Chemical Co., Ltd. opened a new manufacturing plant for APIs in Osaka. The plant is expected to reduce production costs and improve the efficiency of API manufacturing.

Key Players Operating in Japan Active Pharmaceutical Ingredient Market are:

·         Cipla Limited

·         Pfizer, Inc.

·         Sun Pharmaceutical Industries Ltd.

·         AbbVie Inc.

·         AstraZeneca plc

·         GlaxoSmithKline plc

·         Sanofi S.A.

·         Teva Pharmaceutical Industries Ltd.

·         Novartis International AG

·         Boehringer Ingelheim International GmbH

·         Piramal Enterprises Ltd.

·         Aurobindo Pharma

Markets and Data report answer the following questions:

·         What is the current and future market size of the product/service in question globally or specific to different countries?

·         How are the markets divided into different product/service segments and the market size and growth of each segment?

·         What is the market potential of different product segments and their investment case?

·         How are the markets predicted to develop in the future and what factors will drive or inhibit growth?

·         What is the business environment and regulatory landscape specific to the product/service?

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