US API Market

The US API market is experiencing a CAGR of 7.5% during the forecast period, driven by increased production of pharmaceuticals, rising chronic illness rates, and the growth of CDMOs (Contract Development and Manufacturing Organisations). In addition, the US effective regulatory framework that guarantees high-quality medication development, an ageing population, and increased healthcare spending are driving the demand for APIs in the US.

The integration of API and FDF services enhances cost optimization, operational efficiency, and reduces supply chain fragmentation, thereby driving market growth in competitive markets. For instance, in March 2025, Noramco Group launched a North American pharma supply chain services provider, integrating the capabilities of two Noramco subsidiaries, Halo Pharma and Purisys. The move aims to address US drug shortages and quality concerns by improving supply chain performance and increasing domestic production. The integration is expected to streamline industry processes, reduce logistics costs, and enhance regulatory compliance.

Chronic diseases in the US, including heart disease, cancer, diabetes, obesity, and hypertension, are increasing due to aging demographics, sedentary lifestyles, unhealthy diets, and environmental stressors. This has led to a growing demand for long-term therapeutic solutions, influencing the US API market, which relies on a reliable supply. According to the National Center for Chronic Disease Prevention and Health Promotion, in February 2024, in the US, approximately 129 million individuals are living with at least one major chronic disease, such as heart disease, cancer, diabetes, obesity, or hypertension, according to the US Department of Health and Human Services. These conditions contribute to five of the top ten leading causes of death in the country, and their prevalence has been rising over the past two decades, a trend that is anticipated to persist. Currently, 42% of Americans have two or more chronic conditions, and 12% live with five or more, leading to significant personal and systemic impacts, as managing these diseases accounts for about 90% of the annual $4.1 trillion spent on health care.

The market growth of US-based API manufacturing facilities is largely driven by government support, such as BARDA, USAID, and DPA. For instance, in May 2024, USAID launched a $5 million project to diversify Asia’s pharmaceutical supply chain, aiming to produce, regulate, and export quality-assured medical products and active pharmaceutical ingredients in Uzbekistan and Kazakhstan. The two-year project leverages two USAID programs, Promoting the Quality of Medicines Plus and the Indo-Pacific Opportunity Program, to enhance manufacturing, governance, regulatory systems, procurement, technology, and workforce development. The project includes a manufacturing landscape analysis, the development of new chemical synthesis processes, national pharmaceutical manufacturing strategies, quality testing, industry incentives, and workforce capacity training.

Key US-based and operating players include Pfizer Inc., Thermo Fisher Scientific, Cambrex Corporation, AbbVie Inc., and Catalent Inc., all of which are expanding domestic production capacities to reduce reliance on overseas suppliers and strengthen pharmaceutical resilience.

Recent Developments

• In February 2025, Eli Lilly planned to build four new US pharmaceutical manufacturing sites to increase domestic medicine production across therapeutic areas, bringing its total US capital expansion commitments to over $50 billion since 2020. The sites will focus on active pharmaceutical ingredients and injectable therapies.
• In February 2025, Lilly plans to invest $27 billion in US drug manufacturing, building four new sites to strengthen domestic medicine production, reshoring small molecule chemical synthesis capabilities, and expanding its US parenteral manufacturing network for injectable therapies.
• In March 2024, C2 PHARMA launched its new oxybuprocaine HCL API, manufactured by Laurus Labs. This addition will expand the company’s ophthalmic API range and meet market needs. The API, also known as Benoxinate, is used in ophthalmology and otolaryngology.
• In May 2024, Eli Lilly doubled its investment in its Lebanon, Indiana, manufacturing site, increasing its total investment from $3.7 billion to $9 billion. The expansion improves Lilly’s capacity to manufacture active pharmaceutical ingredients for Zepbound and Mounjaro injections, enabling more adults with chronic diseases like obesity and type 2 diabetes to benefit from these treatments.
• In September 2024, Wanbury launched its new active pharmaceutical ingredients (API) product portfolio for FY24- 25, covering therapeutic areas like anti-diabetics, antidepressants, anti-histamines, analgesics, anti-inflammatory drugs, antitussives, and anesthetics. The products include APIs like Sertraline HCl, Diphenhydramine HCl, Diphenhydramine Citrate, and Metformin HCl. The company plans to file for regulatory approvals, including USDMF and CEP, in line with regulatory standards.
• In May 2023, the Activate program, launched at the 2022 COP27, aims to collaborate with Active Pharmaceutical Ingredients (API) suppliers to drive positive change in the pharmaceutical industry’s value chain. The program supports decarbonization through measurement, practical tools, expert advice, and access to green financing. It involves onboarding API suppliers, capturing footprint data, and addressing environmental impact. Key resources include green chemistry solutions, green finance opportunities, training, API best practices, and renewable technologies. Activate funds for these initiatives through contributions from founding member companies, with the first 200 API supplier sites fully sponsored.