Pharmaceutical Excipients Market Size Analysis:

The Pharmaceutical Excipients Market was valued at USD 9.5 Billion in 2023 and is expected to reach USD 17.8 billion by 2032, growing at a CAGR of 7.2% over the forecast period 2024-2032. Pharmaceutical Excipients Market report offers a comprehensive perception of the market along with timely and precise information. It explains disease incidence and prevalence, outlining their effects on pharmaceutical demand and excipient consumption. The report insightfully analyzes prescription trends by region, as well as breaking down excipient consumption across key markets. It also highlights the drug production and usage volume, based on which growth patterns impacting excipient demand become visible. A budgetary analysis of healthcare spending identifies government, private, and out-of-pocket expenditures driving market activity. Additionally, the report includes trends in regulatory compliance and the use of new excipients, such as multi-component and co-processed formulations, that are leading innovation in drug development. The pharmaceutical excipients market is experiencing significant growth, driven by increasing demand for drug formulations and advancements in the pharmaceutical industry.

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Pharmaceutical Excipients Market Dynamics

Drivers

• Advancements in formulation technologies, such as lipid-based drug delivery systems and 3D printing, are revolutionizing drug development and increasing demand for specialized excipients.

The pharmaceutical excipients market is experiencing a significant advancement due to the advancements in formulation technologies. For example, 3D printing has emerged as a potentially transformative technology for drug development, as it allows for the creation of more personalized medications with specific dosages and controlled-release characteristics. Personalized medicine offers improved therapeutics and patient compliance by tailoring treatments according to the needs of each individual. Nanotechnology also contributes significantly, as it enables targeted drug delivery systems that enhance treatment efficacy while reducing side effects. They can be customized to deliver drugs to specific cells or tissues; bypassing biological barriers and reaching their intended targets. This targeted approach reduces exposure of healthy tissues to drugs, thereby enhancing the therapeutic window.

Additionally, some innovation in drug delivery methods, such as Merck's subcutaneous formulation of its cancer treatment Keytruda, involves administration in an injectable form. A new study showed that this injectable form of the drug is non-inferior to the traditional intravenous formulation, but patients may prefer the route of administration using the injectable form. The subcutaneous injection takes approximately 2-3 minutes to administer, greatly lessening the duration compared to the 30-minute intravenous drip. This technology requires adopting specialized excipients that can promote stability, bioavailability, and sustained release of active pharmaceutical ingredients while in a complex formulation. As a result, the need for novel excipients is increasing since they play an essential role in developing and delivering those new drug delivery systems.

Restraint:

• Stringent regulatory requirements for excipient safety and compatibility pose challenges for manufacturers, leading to increased development costs and extended timelines.

Stringent regulatory requirements have posed several challenges for the pharma excipients market to maintain patient safety and drug efficacy. which can comprise as much as 95% of a drug formulation, are pivotal to the quality and performance of medicines. This leads to consistency with the international quality standards of excipients to ensure safety, however countries like India, does not have specific regulations for excipients. Give a regulatory background to explain this further and highlight that the manufacturers have to comply with regulations like Good Manufacturing Practices (GMP), International Pharmaceutical Excipients Council (IPEC) standards, and certifications like EXCiPACT. To meet these standards, companies are typically required to increase their development costs and lengthen their development cycles by implementing stringent product quality assurance processes and conducting in-depth supplier screenings. Different drug formulations may share a single excipient; in fact, one excipient can be used in hundreds of different drug formats; thus, the impact of any quality deviations is multiplied. Furthermore, excipient regulations are added to the complexities of pharmaceutical manufacturing due to the need for regional harmonization of excipients. Excipient quality and safety should be maintained without any exception, but this proves a challenge for manufacturers who are operating under diverse and rigorous regulatory environments.

Opportunity:

• The development of multifunctional excipients offers benefits like improved flowability, compressibility, and bioavailability, streamlining drug formulation processes, and reducing costs.

The development of multifunctional excipients is significantly enhancing pharmaceutical formulation by improving flowability, compressibility, and bioavailability, thereby streamlining drug development and reducing costs. Noteworthy, these excipients can possess multiple functionalities, e.g., they can function as binders, fillers as well as disintegrants in a single compound, making the formulation process easier and reducing the number of necessary additives. Since the drug compaction process involves significant amounts of stress and pressure, this has prompted the development of excipients that not only ensure the structural strength of tablets but also increase the dissolution rate of APIs, increasing their bioavailability. For example, certain polymers have been found to improve the solubility efficiency of poorly water-soluble drugs. The market is predominantly driven by the rising acceptance of multifunctional excipients as they help in cost reduction and the enhancement of effectiveness in drug manufacturing.

In addition, the need for advanced drug delivery systems has driven the utilization of multipurpose excipients. Other excipient groups enable the preparation of delayed-release dosage forms, which are designed to release the drug at the site of action, thus improving therapeutic effect and compliance. The trend towards patient-centric formulations, such as orally disintegrating tablets, further underscores the importance of multifunctional excipients in modern pharmaceutical development.

Challenge:

• Ensuring consistent quality and safety of excipients is challenging due to variations in manufacturing processes, which can impact drug efficacy and patient safety.

Manufacturers of pharmaceutical excipients face a critical challenge in ensuring the consistent quality and safety of those excipients because the processes used to manufacture may cause unavoidable variability. Such variations can affect drug efficacy and patient safety, given that excipients often play a critical role in drug formulations. A recent study highlighted that approximately 20% of medicines in Africa are substandard or falsified, with complex supply chains and multiple intermediaries facilitating the infiltration of such products. However, in September 2024, the Central Drugs Standard Control Organisation in India declared over 50 medicines, including commonly prescribed medicines like antacids and paracetamol, substandard and fake. These incidents underscore the need for strict oversight and traceability in excipient supply chains. To avoid the concerns posed by excipient variability, experts recommend implementing strong QMS and following Good Manu­facturing Practices (GMP). More recently, big data analysis has been proposed for the identification and control of such variability of excipient production processes to enhance overall drug quality and safety. Such ingredients must be manufactured in such a way that factors like quality, stability, consistency, and safety are maintained.

Pharmaceutical Excipients Market Segmentation Analysis

By Product

In 2023, organic chemicals segment accounted for the largest market share of 51%. These include the prevalent and longstanding applications of organic chemicals in drug formulations. Sugars, alcohols, polymers, and surfactants, which are representative organic excipients, play key roles in binding, solubilization, and stabilization of active pharmaceutical ingredients (APIs). We are already an organic chemical manufacturer as preferred by consumers. According to the U.S. Department of Agriculture, the organic food market in the United States grew by 12.4% in 2022, reflecting this trend towards natural ingredients. Additionally, the guidance provided by the FDA regarding the use of novel excipients in drug products has spurred innovation in this space. Moreover, the European Medicines Agency (EMA) has identified the need for excipient safety, which also has resulted in increased research and development for organic excipients. Production of organic excipients may witness a surge due to government initiatives like the Indian government's Production Linked Incentive (PLI) scheme for the pharma sector which also includes key starting materials and drug intermediates.

By Functionality

In 2023, fillers and diluents segment accounted for the highest revenue share in the market. The prominence of this segment is attributed to the essentiality of fillers and diluents in tablet and capsule formulations, maintaining appropriate volume, and enhancing the physical characteristics of drug products. Fillers and diluents are critical in pharmaceutical processing and stringent standards have been established by the US Pharmacopeia (USP). As stated by the FDA's Center for Drug Evaluation and Research (CDER), solid oral dosage forms that rely heavily on fillers and diluents have seen a steady rise in approvals. The need for such all-in-one insights was further addressed when the European Directorate for the Quality of Medicines & HealthCare (EDQM) recently revised its recommendations for excipient functionality, recognizing the importance of fillers and diluents in drug formulations. Novel excipients, such as novel fillers and diluents, have been supported by scientific advisor offices, such as the UK Medicines and Healthcare Products Regulatory Agency (MHRA) Innovation Office. In addition, the application of innovative filler and diluent technologies submitted with drug applications continues to rise, according to The Japanese Pharmaceutical and Medical Devices Agency (PMDA) further boosting the segment's growth.

By Formulation

In 2023, the Oral Formulations segment accounted for the largest revenue share. Oral drug delivery is the largest segment and dominated the drug delivery market owing to high patient compliance, convenience and cost effectiveness. The FDA’s Office of Generic Drugs said that 90% of the most frequently dispensed U.S. medicines are generic drugs, and many of these are oral formulations. The European Medicines Agency (eMA) has highlighted the importance of patient-centric drug design in oral formulations to enhance adherence and ensure optimal treatment outcomes. According to the World Health Organization (WHO), oral formulations remain the most widely used drug delivery method globally, accounting for over 60% of all prescribed medications. Government actions, including the U.S. Department of Health and Human Services’ push to lower the cost of prescription drugs, have also increased demand for oral generic drugs. Government initiatives such as 'Pharma Vision 2020' which outlines a roadmap for making India a global leader in end-to-end drug manufacture focusing on oral formulations will generate the demand for excipients in this segment.

By Functionality Application

In 2023, the Solubility & Bioavailability Enhancement segment accounted for a significant revenue share. The importance of this segment is attributed to an active pharmaceutical industry focused on enhancing the effectiveness of poorly soluble drugs. The FDA has reported that approximately 40% of approved drugs and nearly 90% of developmental pipeline drugs have poor solubility, highlighting the critical need for solubility-enhancing excipients. The EMA has released its Guideline on the Investigation of Bioequivalence, which is focused on the Excipient's role in improving drug bioavailability. There has also been an increasing amount of research into solubility enhancement in the drug development process, as recognized by the Japanese Pharmaceuticals and Medical Devices Agency (PMDA). NIH grants for drug delivery and other science have paved the way for solubilization technologies and improved the ability to solubilize down to a nanometer scale. The UK's Innovation Office of its Medicines and Healthcare Products Regulatory Agency (MHRA) has also been supportive of new excipient development for bioavailability enhancement, thus propelling growth within this segment.

Regional Insights

In 2023, the Asia Pacific region accounted for the largest share of the pharmaceutical excipients market, driven by robust pharmaceutical manufacturing, expansion of generic drug markets, and government support for the healthcare sector. In 2022, China's National Medical Products Administration (NMPA) approved 6% of global drug approvals, a 22% increase over the previous year's data. End-to-end drug manufacturing is one of the goals of the India Department of Pharmaceuticals for 2030, which is projected to greatly increase the demand for pharmaceutical excipients in the Asian Region. The Japanese government's initiative to promote the use of generics, targeting 80% of the market by volume, is also contributing to the region's rapid growth in the pharmaceutical excipients market. At the same time, the North America region is anticipated to grow with the significant compound annual growth rate (CAGR) over the forecast period. This growth is driven by, region's advanced pharmaceutical industry, strong research and development ecosystem, and supportive regulatory climate. In 2023, 59 novel drugs were approved by the U.S. Food and Drug Administration (FDA), providing insight into a solid pipeline of pharmaceutical and biologic products that will need advanced excipients. Initiatives by the U.S. government, like the 21st Century Cures Act, have quickened the drug development processes, indirectly fostering the excipients market.

Pharmaceutical Excipients Market Key Players

Key Service Providers/Manufacturers

• SEPPIC (Montanov 68, Sepigel 305)

• Celanese (Sunett, Clarifoil)

• Hovione (Spray-dried lactose, Microcrystalline cellulose)

• Danisco (Microcrystalline cellulose, Ethylcellulose)

• Vianex S.A. (Lactose monohydrate, Magnesium stearate)

• Dishman Carbogen Amcis (Vitamin D3, Cholesterol)

• BASF (Kollidon, Soluplus)

• Dow Chemical Company (Methocel, Ethocel)

• Evonik Industries (Eudragit, Aerosil)

• Ashland Global Holdings (Klucel, Plasdone)

• Roquette (Pearlitol, Lycatab)

• FMC Corporation (Avicel, Aquacoat)

• Colorcon (Opadry, Surelease)

• Lubrizol Life Science (Carbopol, Pemulen)

• Shin-Etsu Chemical Co., Ltd. (Metolose, Pharmacoat)

• JRS Pharma (Vivapur, Prosolv)

• DFE Pharma (Lactohale, SuperTab)

• Kerry Group (SheffCoat, PharmaGrade Lactose)

• Meggle Pharma (FlowLac, Tablettose)

• Anhui Sunhere Pharmaceutical Excipients Co., Ltd. (Microcrystalline cellulose, Croscarmellose sodium)

​​​​​Recent Developments in the Pharmaceutical Excipients Market

• In June 2024, DuPont launched a new series of plant-based excipients specifically designed for controlled-release applications, catering to the increasing trend of using natural ingredients in pharmaceuticals.

• In January 2025, BASF SE enhanced its capacity to produce pharmaceutical-grade excipients in Germany, even as demand surges for high-quality excipients in Europe and globally.