Excipients markets in Middle East, Africa, and Southeast Asia offer untapped potential with above-average growth

Following the global trend, the fastest-growing category in these regions is coatings, says report from Kline

Southeast Asia is the fastest-growing pharmaceutical market in the world having seen double-digit growth since 2011. Excipients consumption in the region is also strong and estimated to increase at a compound annual growth rate of 13.4% to 2020, according to a report from global market research and management consulting firm Kline.

The report, Specialty Excipients for Oral Solid-Dosage-Form Pharmaceuticals: Emerging Markets Analysis and Opportunities, also finds solid pockets of opportunity in the Middle East and Africa region, which is forecast to progress at a CAGR of nearly 8% to 2020.

Despite having small market shares in the global market, the Middle East and Africa and Southeast Asia account for roughly 5% and 4%, respectively, in the global speciality excipients market.

Growing populations, increasing government healthcare expenditure, developing health insurance industry, and the increase in the prevalence of chronic disease, among others, are contributing to the pharmaceutical industry’s expansion in these regions, the report says. However, these markets are dependent on imports for pharmaceutical raw materials since there is minimal or no domestic manufacturing.

The top five suppliers in these regions are DFE Pharma, Roquette, Meggle, JRS Pharma, and MingTai, which together hold more than a 50% share in sales by volume.

The countries within Southeast Asia are heading towards higher regulatory standards and synchronisation of regulations

European suppliers have relatively greater influence in the Middle East, while Indian and Chinese suppliers have a relatively greater share in the Southeast Asian market, the report finds.

'Southeast Asia is the fastest-growing pharmaceutical market in the world and attracts the interest of many global pharmaceutical companies,' said Nikola Matic, Industry Manager, Chemicals & Materials at Kline.

'Although the pharmaceutical industry regulations in Southeast Asia are not as stringent, the countries within this region are heading towards higher regulatory standards and synchronisation of regulations, aiming to reduce regulatory complexities for manufacturers. This creates a favourable environment for the market entry for excipients suppliers.'

Indonesia is the largest consumer of binders and fillers in Southeast Asia, with more than 40% of total consumption by volume and value, followed by Thailand and Vietnam.

In the Middle East and Africa region, the Middle East has more than a 60% share of the total consumption volume, while Turkey, Israel, and Egypt are the three leading countries in terms of consumption of excipients.

Following the global trend, the fastest-growing category in these regions is coatings. However, the share of ready-to-use formulated coatings is much higher than the film-formers for in-house coatings compared with the other regions. Among the key reasons for this preference is the ease of use and less developed formulation research and development technologies and expertise, says Kline.

Oral solid doses are the prominent drug delivery route in the pharmaceutical industry, in which the role of several excipients is continuously growing to contribute added functionalities to the drug formulations. Growth in the local manufacturing of OSDFs is expected to drive the market of excipients in Southeast Asia and the Middle East and Africa, and as a result, these regions can represent large growth areas for excipients suppliers.

Companies