WHERE DO OUR ACTIVE PHARMACEUTICAL INGREDIENTS

COME FROM? – A WORLD MAP OF API PRODUCTION

Short Report

Berlin, September 2020

SUMMARY

• Europe’s supply of active pharmaceutical ingredients is exposed to various risks

o 2/3 of the currently valid CEPs for APIs are held by Asian manufacturers
o Indian and Chinese production sites are concentrated in a few provinces
o For 1/6 of the APIs analyzed in this study, there is no European production at all, for more than
half of the APIs there are between 1 – 5 CEPs and therefore only very few manufacturers
worldwide

• Europe has lost its strong position as an API producer. Looking at new approvals of CEPs between
2000 and 2020, Asia significantly outperformed Europe: Asian manufacturers increased the number
of their CEPs from 183 to 2,369, while European manufacturers only grew from 348 to 1,260 CEPs

• Unequal regulatory standards and cost pressure are main reasons for this development. India and
China are actively outperfoming European businesses

• Today, European manufacturers focus on specific APIs (e.g. low production volumes, complex
production processes), but technical know-how and capacities to increase European API production
are (still) available

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CENTRAL QUESTIONS, SCOPE OF THE STUDY AND METHODOLOGY

• To what extent does Europe depend on Asia to cover its demand for APIs?
Central
• Objective: Creation of a well-founded database
questions
• What are main drivers for the development within the recent years?

• Generic APIs with at least one CEP (Certificate of Suitability of Monographs of the European
Pharmacopoeia; proof of active pharmaceutical ingredients quality, used for drug approvals)
Scope of the • Focus on APIs, no consideration of raw materials and intermediates
study
• In total: 554 APIs with valid CEPs
• Sample selection of 21 APIs from the above-mentioned API database for in-depth analyses

• Creation of a cleansed CEP database, enriched with additional manufacturers’ information

• In-depth analysis of the data from cleansed CEP database according to various criteria
• Desk Research for further investigations
Methodology
• Interviews with API manufacturers and stakeholders
o For quantitative estimation of the coverage of European demand for selected APIs
o To validate the findings and to confirm observed trends and their causes

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ASIA CURRENTLY HOLDS ALMOST TWICE AS MANY CEPS AS EUROPE
OVERVIEW: GLOBAL DISTRIBUTION OF CURRENTLY VALID CEPS (2020*)1

Number of CEPs
North America 157 3.786
2.369 3% 4%
Other
1%

India
41%
63%

China
13%
ROA
1.260 8%
Italy
Spain 9%
5% Germany
5% 33%
France
ROE 2%
12%
Europe Asia ROW Total
Europe Asia ROW

*) Data
collection: 30.04.2020, applies to all subsequent analyses
Number of all valid CEPs in the respective calendar year for the APIs under consideration (expired / withdrawn CEPs are already excluded)
1)

Source: Certificate Database, European Directorate for the Quality of Medicine & Healthcare, Date: 30.04.2020
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HIGH CONCENTRATION OF MANUFACTURERS IN SPECIFIC PROVINCES OF
INDIA AND CHINA POSE A HIGH RISK, E.G. IN TIMES OF COVID-19
GEOGRAPHICAL ALLOCATION OF ASIAN CEPS (2020)1

India: Geographical Allocation of CEPs by Province China: Geographical Allocation of CEPs by Province

Hebei
Shandong

Jiangsu
Hubei

Telan- Zhejiang
gana

Karnataka
Andhra
Pradesh

Tamil Nadu

Number of all valid CEPs in the respective calendar year for the APIs under consideration (expired / withdrawn CEPs are already excluded)
1)

Source: Certificate Database, European Directorate for the Quality of Medicine & Healthcare, Date: 30.04.2020
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FOR 1 OUT OF 6 APIS NEEDED IN EUROPE THERE ARE NO
EUROPEAN CEP HOLDERS AT ALL
OVERVIEW: GLOBAL DISTRIBUTION OF API PRODUCTION (2020)1

Number of APIs with Valid CEPs by Region Total APIs: 554

96 365 93
Asian share CEPs: < 20%
19
Asian share CEPs: 20 < 40%
68

Asian share CEPs: 40 < 60%

109

Asian share CEPs: 60 < 80%

101

Asian share CEPs: >=80%

68

CEPs only CEPs in Asia and Europe2 CEPS only

in Europe in Asia2

Number of all considered APIs with valid CEPs in the respective calendar year (APIs with expired / withdrawn CEPs are already excluded);
1)

Including Rest of World

2)

Quelle: Certificate Database, European Directorate for the Quality of Medicine & Healthcare, Date: 30.04.2020
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FOR MORE THAN HALF OF THE APIS THERE ARE BETWEEN 1 – 5
CEPS WORLDWIDE AND THEREFORE ONLY A FEW MANUFACTURERS
OVERVIEW SHARE OF APIS PER GROUP "CEPS PER API" WORLDWIDE (2020)1
In % of APIs

< 5 CEPs 56%

6 - 10 CEPs 23% Proportions:

• 25% with 1 CEP
• 22% with 2 CEP
11 - 15 CEPs 10% • 17% with 3 CEP
• 20% with 4 CEP
• 16% with 5 CEP

16 - 20 CEPs 6%

21 - 25 CEPs 3%

> 25 CEPs 1%

Number of all considered APIs with valid CEPs in the respective calendar year (APIs with expired / withdrawn CEPs are already excluded)
1)

Source: Certificate Database, European Directorate for the Quality of Medicine & Healthcare, Date: 30.04.2020
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THE RATIO BETWEEN EUROPE AND ASIA HAS COMPLETELY
REVERSED WITHIN THE PAST 20 YEARS
DEVELOPMENT OF THE NUMBER OF VALID CEPS (2000 – 2020)1

Number of CEPs
3.786 "There is high price pressure on the generics
market due to discount agreements. As a result,
many generic companies are forced to buy active
33% pharmaceutical ingredients at low prices in Asia"
(1.260)

2.554
"Approval process in Europe is too slow, while in
40% India new facilities are being built without
problems"
63%
(2.369)

54% "Customers do not accept that it is important to

589
produce in Europe. They are not willing to pay
59%
4% more. Indian prices can never be undercut "
31% 10% 5% (157)
2000 2010 2020

Europe Asia ROW

Number of all valid CEPs in the respective calendar year for the APIs under consideration (expired / withdrawn CEPs are already excluded)
1)

Source: Certificate Database, European Directorate for the Quality of Medicine & Healthcare, Date: 30.04.2020
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THERE ARE MORE CEPS AND MORE MANUFACTURERS IN ASIA, BUT
ABOUT THE SAME NUMBER OF APIS AS IN EUROPE
OVERVIEW CEPS, APIS AND MANUFACTURERS BY REGION (2000 – 2020)1

Europe

Number x 3,6
of CEPs

1260
1026
348

2000 2010 2020

API 193 386 461

Mfr.2 132 242 236

Germany Asia

Number x 3,4 Number x 13,1

of CEPs of CEPs India
2369 China
1391 x 16,6 x 22
1559
55 170 185 181
856
507
301
94 23
2000 2010 2020 2000 2010 2020
API 46 136 143 API 86 335 447 2000 2010 2020 2000 2010 2020
Mfr.2 24 38 35 Mfr.2 91 380 421

Number of all valid CEPs in the respective calendar year for the APIs under consideration (expired / withdrawn CEPs are already excluded)
1)

Mfr. = Manufacturer
2)

Source: Certificate Database, European Directorate for the Quality of Medicine & Healthcare, Date: 30.04.2020
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THE LATER AN API ENTERS THE CEP PROCEDURE, THE LOWER THE
SHARE OF EUROPEAN MANUFACTURERS
DEVELOPMENT OF THE SHARE OF ASIAN MANUFACTURERS BY LIFE CYCLE

First Year of the API in CEP procedure

Until 1999

2000 - 2009

2010 - 2019

0 1 2 3 4 5 6 7 8 9 10

Life Cycle Year

CEP Share Asia: 0% > 0 – 20% > 20 – 40% > 40 – 60% > 60 – 80% > 80 – 100%

Source: Certificate Database, European Directorate for the Quality of Medicine & Healthcare, Date: 30.04.2020
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IN-DEPTH ANALYSIS: THE HIGHER THE VOLUME OF AN API, THE
HIGHER THE PROPORTION OF ASIAN CEP HOLDERS
SELECTED APIS: CEP SHARE ASIA IN RELATION TO DEFINED DAILY DOSES (2020)1,2

CEP Share Asia (in %) Bubble Size: Number of CEPs per API

Metamizole Simvastatin
100
Levetiracetam Venlafaxine Candesartan
90

80 Metformin Ramipril
Quetiapine
70
Azithromycin Diclofenac Prednisolone
60
Formoterol
50
Levothyroxine
40 Amoxicillin
Propofol
30
Methotrexate
20 Tamoxifen
10

0 Oxycodone

1 10 100 1.000 10.000

Defined Daily Dose (DDD) per Quarter (in million)

Number of all valid CEPs in the respective calendar year for the APIs under consideration (expired / withdrawn CEPs are already excluded)
1)

API sample selected by defined daily dose Q4 2019 > 1 million DDD in retail (exclusion of: Piperacillin, Benserazide, Levodopa); n = 18
2)

Source: Certificate Database, European Directorate for the Quality of Medicine & Healthcare, Date: 30.04.2020; Basic List Pro Generika
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 Estimation
IN-DEPTH ANALYSIS: SMALL-VOLUME, COMPLEX APIS TEND TO COME
FROM EUROPE, WHILE ASIA IS KNOWN FOR LARGE-VOLUME APIS
ESTIMATED SHARE OF SUPPLY FOR EUROPEAN DEMAND BY REGIONS
Share of supply in % (Above the Pillar: Total European Demand in Tons)
44 29 2,3 1,3 8,5 14 0,08 299 3.670 225
5% 5% 5% 10% 10% 5%
15%

30%
60%
65%
100% 100% 95% 95% 95% 90% 85%
10%
60%

30% 30%

Benserazide Propofol Methotrexate Levothyroxine Tamoxifen Oxycodone Formoterol Levodopa Amoxicillin Quetiapine

2.900 107 19.430 279 22 904 46 430 172 70 146

10% 5%
15%

45%
60%
80% 75% 80%
85% 85% 85%
65% 80% 90%

45%
5% 40%
10% 5% 5%
20% 20% 20% 15% 10% 10% 10% 10% 10% 5%
Metamizole* Azithromycin Metformin Piperacillin** Prednisolone Levetiracetam Ramipril Diclofenac Venlafaxine Candesartan Simvastatin

India China Europe

*) Estimation, Data basis limited; **) API mainly in combination with Tazobactam (exclusively produced in Asia).
Source: Supplier Interviews, Import Data Analysis QYOBO Market Platform, CEP Database, Pharmaoffer; IQVIA
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TODAY EUROPE FOCUSES ON SPECIFIC APIS; POTENTIAL FOR PRODUCTION
EXPANSION STILL EXISTS AND IS ALREADY RECOGNIZED BY POLITICS

Europe focused on specific APIs – Potential for The focus is on strengthening the European network –
production expansion still exists Example Kundl (Novartis/Sandoz)
Share of valid CEPs
by region 20201 4%
Asia
Europe
33%
ROW

63%

"Complex APIs are competitive, as simple ones

are not, because they can easily be produced by
Chinese manufacturers" • Kundl plant is the last remaining, fully integrated
antibiotics production site in the western world
"Some customers pay attention to production safety • Novartis and Austrian government secure long-term
and the environment and therefore buy more production of key antibiotics in Europe
expensive European products" • Planned joint investment of more than EUR 150
million - Austrian government contributes EUR 50 million
“The required production capacities would be
sufficiently available in the EU because of empty
and multi-purpose plants"

Number of all valid CEPs (expired / withdrawn CEPs are already excluded)
1)

Source: Certificate Database, European Directorate for the Quality of Medicine & Healthcare, Date: 30.04.2020; Supplier Interviews
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 DR. ANDREAS MEISER
PARTNER

MILESTONES
Partner at MUNDICARE

Numerous consulting projects with a broad industry portfolio focusing on business development,
implementation of new technologies and the planning/implementation of PMOs

Interim management R&D in a medium-sized pharmaceutical company: Development of new
production methods to increase efficiency

Setting up biotechnology start-ups: development and marketing of new technologies in the field of
MUNDICARE benefits from Andrea's extensive experience in academic research, strategy blue (algae) biotechnology
consulting, and the setting up and management of biotech start-ups. He works at the interface 
McKinsey & Company: After initially working in a wide range of process industries, he joined the
between science and industry and drives the implementation of new solutions in the biotech
chemical practice as an industry specialist. Afterwards he was a project manager with a portfolio of
environment. Prior to his partnership at MUNDICARE, he was responsible for research and engagements in the areas of chemicals, climate change and biotechnology. As an industry expert, he
development in various companies and led interdisciplinary consulting projects with large teams. supported teams worldwide in biochemicals and bioenergy. Andreas has a global client portfolio with
relocation to Asia, is an author of publications and lectures at various international congresses

FOCUS Longer research stays in Russia and Latin America
< Strategy: business development, innovation, market assessment and market 
PhD in biotechnology: Commercial production of active pharmaceutical ingredients using a
entry strategies
biotechnological approach
< Implementation: Implementation of projects, PMOs in various industries 
< Regional experience: Germany, Europe, Asia Scientific activity at Fraunhofer Gesellschaft

Study of microbiology/biotechnology

Intensive engagement in chemistry, National Team Chemistry Olympiad

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+49163 49 65 770 MUNDICARE GmbH
[Link]@[Link] Zenettistrasse 2
80337München
Germany

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