Pharma Coatings Supply Concentration

  • Coatings industry is consolidated with four major players, such as Colorcon, Sensient, Evonik, and BASF holding close to 85–90 percent of the global market share in 2017 

  • With over 6 manufacturing facilities and market presence across the globe, Colorcon is the market leader in coatings market with around 50–60 percent of the market share in the US and is expected to retain the same due to its superior technological capabilities, R&D and product differentiation

Tablet Coatings - Global Market Demand by End-use

  • High growth rates in demand could be attributed to:

    • Rapidly expanding middle class and government incentives to provide drugs at a lower cost

    • Expansions by private firms and governments allowing FDI to penetrate into untapped markets 

  • Formulated and customizable blends are key areas, in which drug manufacturers are displaying their interest. This is expected to increase the total addressable market for tablets and hence demand for tablet coatings

Tablet Coatings - Industry Drivers

  • Growth in modified release technologies

    • Market is driven by demand from oral solid dosage forms, such as sustained, enteric and immediate release tablets

    • The modified release market is expected to grow at a CAGR of 6–7 percent until 2022

  • Pharmaceutical tablets coatings

    • There is a growing demand for pharmaceutical tablet coatings, which currently accounts for about 70 percent and is expected to drive the tablet coatings market

  • Demand for pigmented film coatings

    • Demand for pigmented film coatings is growing mainly due to its application in the prevention of counterfeit drugs. Also, the visual differentiation of products helps in enhanced brand recognition

Tablet Coatings - Industry Constraints

  • Fluctuating raw material cost

    • Pricing risk exists as the prices fluctuate for different raw materials, which has a negative impact on the coatings market

  • Consolidated market

    • The supply base for tablet coatings is consolidated resulting in a low negotiation power for buyers

  • Need for coatings technology and Quality by design

    • High expectations of different coatings technology and US FDA requirement for quality by design from pharmaceutical and nutraceutical industries, have led to an innovation driven market, in turn making it difficult for new players to enter