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The International Finance Corporation’s Investments in the Pharmaceutical and Life Sciences Sector

Glossary

Active Pharmaceutical Ingredients

  • Active Pharmaceutical Ingredients (APIs) are any substance or mixture of substances intended to be the biologically active ingredient (or “active substance”) contained in a final medicinal product and intended to provide pharmacological activity or other direct effects.
  • APIs are broadly categorized into two types: synthetic and natural. Synthetic APIs are further classified into innovative and generic synthetic APIs, based on the type of synthesis used.
  • Synthetic chemical APIs, also known as small molecules, constitute a large part of the pharmaceutical market, with many small-molecule drugs commercially available in the market.
  • Natural APIs are used in making biologics, which are increasingly becoming the top-selling drugs in the market. Despite the growing demand, biologics are currently significantly fewer in number compared with small-molecule drugs.
  • Based on the solubility, APIs are categorized into insoluble and soluble drugs.
  • API production requires different levels of specialists, including pharmaceutical executives, research and development executives, quality control and quality assurance executives, API manufacturers, distributors, suppliers, sales managers, process engineers, technicians, research associates and production chemists, and any other individuals involved in the operations of the API and active pharmaceutical intermediates industry.
  • Examples of APIs in branded medications include Advil, Benadryl, and Claritin; examples in over-the-counter medications include ibuprofen, diphenhydramine, and loratadine.

Excipients

  • Pharmaceutical excipients are ingredients other than the API present in a finished pharmaceutical drug formulation. These are frequently used as lubricants, diluents, binders, flavorings, coatings, and coloring agents for the formulation.
  • Excipients are chemically inactive substances such as binders, preservatives, and artificial dyes that give the pill its color. Some of these materials help the medication remain stable and control absorption when the drug is taken.

Intellectual Property Rights—Why Are They Important?

Intellectual Property Rights in Pharma. Intellectual property pertains to any original creation of the human intellect, whether artistic, literary, technical, or scientific. Intellectual property rights refer to the exclusive legal right given to the inventor or creator to protect and fully use their invention or creation for a certain period. It has also been conclusively established that the intellectual labor associated with the innovation should be given due importance so that public good emanates from it. There has been a quantum jump in R&D costs and an associated jump in the investments required for putting a new technology into the marketplace. The stakes for the developers of technology have become high, and hence the need to protect the knowledge from unlawful use has become expedient, at least for a period that would ensure recovery of the R&D and other associated costs and adequate profits for continuous investments in R&D. Intellectual property rights are a strong tool for protecting investments, time, money, and effort invested by the inventor or creator. These rights play a vital role in a country, aiding its economic development by promoting healthy competition and encouraging industrial development and economic growth.

Small-Molecule Versus Large-Molecule Drugs

Small-molecule drugs are medications with a low molecular weight made up of chemicals created in a lab. Because they have a straightforward chemical structure, these drugs are relatively easy to make and are shelf stable. Small-molecule drugs are generally administered as a pill, and once taken, they have a general effect that travels to all body parts. Because of their small size, they are easily absorbed into the bloodstream and then into cells, where they interact with other molecules, such as proteins, within the cells. Most people have regular interactions with small-molecule drugs like ibuprofen, antihistamines, or penicillin.

  • Large-molecule drugs (biologics) have a large molecular weight and are manufactured or extracted from living organisms. They are made of proteins that are complex in structure and much less stable compared with small-molecule drugs. Large-molecule drugs are costly to manufacture and, at this time, can only be administered through an IV or infusion. These drugs have a targeted effect on tissues and are increasingly used to treat cancer. Because they are more specific in their function, they are usually less toxic, with fewer healthy cells damaged than other drug treatments. Large-molecule drugs include gene-based therapies, immunotherapies, hormonal regulators, and antibody-conjugated drugs that target proteins expressed in certain cancer types.
  • Biologic drugs may be vaccines, antibodies, or interleukins. They are extracted from, semisynthesized by, or manufactured in living organisms using recombinant DNA technology, while small-molecule drugs are chemically synthesized. This makes biologics more complex. Although biologics represent the future of pharmaceuticals, this does not mean they are a new technology—human growth hormone, insulin, and red-blood-cell–stimulating agents are all biologics.
  • While biologics are perhaps best known for treating certain types of cancer and autoimmune diseases, they promise to prevent and treat a wide range of diseases and health conditions. Anemia, cystic fibrosis, diabetes, transplant rejection, growth deficiency, and hepatitis all have the potential to be treated with biologics.