Jun 122014

Exploratory Study on Active Pharmaceutical Ingredient Manufacturing for Essential Medicines

Active Pharmaceutical Ingredients (API) of good quality are core to the
manufacturing of effective and safe essential drugs. The price of APIs is the main cost
driver for manufacturing. Only a limited number of large manufacturers of finished
pharmaceutical products have their own API manufacturing capabilities, and none of
them can make all required APIs in-house. The majority of manufacturers, including all
those located in Sub-Saharan Africa (with the exception of one company in South Africa)
have to buy all APIs in the open market.
The paper tries to make the structures of the
API market more transparent, trying to determine how difficult it is for small
manufacturers in developing countries to navigate the global API market and ensure that
they get a quality product at a fair price. It also looks into the competitiveness of the
market, trying to assess the risk that manufacturers or traders monopolize parts of the API
market for essential medicines with low commercial attractiveness. The author confirms
the initial assumption that the API market provides a challenge in particular to small
manufacturers, who have limited means to verify the quality of the APIs they are buying.
One potential way to address this problem would be to broaden the WHO
Prequalification system to include APIs for drugs that are on the WHO Model List for
Essential Medicines.

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