Africa API Market

Active Pharmaceutical Ingredient (API) market in Africa is experiencing significant growth of 6.5%, driven by an increasing demand for high-quality pharmaceuticals and a focus on improving healthcare outcomes. South Africa leads the active pharmaceutical ingredients market in Africa and is projected to experience the highest growth rate from 2025 to 2035. This growth is driven by the availability of raw materials, ease of production, and the rising prevalence of various chronic disorders.

Key Facts – African Pharmaceutical Market

The $25 billion African pharmaceutical market is underpenetrated. Pharmaceutical spending per capita is $25, six times less than the global average (about $160), creating a big opportunity.

Generic products are growing at 3.5% p.a. and are driving growth. Oncology is the leading therapeutic area in market value (around 25% of total demand) and shows growth four times higher than that of the overall market (2%).

North African countries represent approximately 40% of total sales, while East Africa and West Africa are forecasted to drive a projected 5.2% annual growth until 2024. The market is also highly concentrated: the top seven countries represent about 75% of the total market, while more than 40 countries.

There is huge potential to develop generics, as they support market expansion with a 3.1% growth rate and currently represent only about 40 % of the total sales. This is considered underpenetrated compared to similar generics-driven markets, such as China and India, where generics represent an estimated 70 % of total sales.

Current Market Trends

• Growing Demand for APIs: The prevalence of chronic diseases such as diabetes, cardiovascular disorders, and cancer is increasing in South Africa, leading to a heightened demand for effective medications. This surge in demand is propelling the growth of the API market as pharmaceutical companies seek reliable sources of high-quality ingredients.
• Emphasis on Local Manufacturing: South Africa is focusing on enhancing its pharmaceutical manufacturing capabilities to reduce its dependency on imports and strengthen the local economy. There has been an increase in investments in local API production facilities, promoting self-sufficiency and creating job opportunities.
• Adoption of Advanced Technologies: Integrating advanced technologies such as biotechnology and nanotechnology in API production is gaining momentum. These innovations enhance the efficiency and quality of API manufacturing, positioning South Africa as a competitive player in the global market.
• Regulatory Advancements: The South African government is implementing stringent regulatory frameworks to ensure the quality and safety of APIs. These regulations align with international standards, facilitating smoother exports and attracting foreign investment.
• Rise of Contract Manufacturing Organizations (CMOs): CMOs are expanding in South Africa, providing pharmaceutical companies with flexible manufacturing options and enabling them to focus on core competencies. CMOs offer expertise in API production, fostering industry growth.

Future Prospects

• Increased Export Opportunities: As South Africa continues to enhance its API production capabilities and regulatory compliance, it is poised to become a key exporter of APIs to neighboring African countries and beyond. This expansion into international markets offers lucrative opportunities for local manufacturers.
• Focus on Research and Development: Investment in research and development is expected to drive innovation in API production. By developing novel APIs and improving existing processes, South African companies can gain a competitive edge in the global market.
• Collaborations and Partnerships: Strategic collaborations between local pharmaceutical companies, research institutions, and international players can accelerate the growth of the API market. These partnerships facilitate knowledge exchange, technology transfer, and access to global distribution networks.