Page 135 - CW E-Magazine (13-8-2024)

Point of View

Cleaning up and decarbonising API manufacturing

The manufacturing of active pharmaceutical ingredients (APIs) is a chemistry-intensive operation in which Indian companies have built significant
expertise. While there are legitimate concerns about the dependency on imports of APIs and the intermediates required to make them, particularly on
China, this is so mainly for commercial reasons. There are few, if any, technical barriers to raising the level of self-sufficiency for most APIs, barring for
those made using biotech processes.

But there is one other concern that is worrying planners and hindering the rapid ramp up of capacity here – the environmental impacts associated
with manufacture of APIs, intermediates and fine chemicals.

This columnist recalls a meeting not too long ago, in which senior pharma industry veterans dwelt on these concerns. At the core of this issue
is the fact that waste generation in API manufacturing is substantial, and requires extensive and expensive treatments to mitigate damage to the
environment and to human or animal health.

Measure of environmental burden
One of the metrics used to define the ‘greenness’ of a chemical reaction is the ‘E-factor’. Simply put, it is the amount of waste generated
(in kg) per kg of desired product. E factors that can be tolerated depend upon the value of the product and the quantity produced. For bulk chemicals
manufactured in hundreds of thousands to millions of tonnes annually, tolerable E factors range from 1 to 5. In the fine and specialty chemical industry,
where annual quantities are typically a few thousand tonnes per year, E factors up to around 500 may be acceptable if the value of the product is high
enough to justify the cost of treating and disposal of wastes. In the API industry, where annual quantities are measured in tens to several hundred tonnes,
acceptable E factors may be up to about 4,000.

Another metric is the Process Mass Intensity (PMI), which is the total mass of all materials used to produce a given mass of a product. This
includes reactants, reagents, solvents (used in the reaction and purification), and catalysts. It is a linear metric, meaning a PMI of 100 is half as
resource-intensive as a PMI of 200, though some other raw materials (e.g., for cleaning) are not in its scope.
The average PMI for APIs range from 70-450. This stems in substantial part from the fact that most small molecule APIs are made by multiple step
synthesis, with each having yields ranging from 30-60%, and even dropping to 5-10% in case of some intricate synthesis. How this all adds up is evident
from the fact that a three-stage process with each having a yield efficiency of 60%, translates to an overall process efficiency of just 22%!
In short, due to the high material input, low process yields, complex chemistries requiring multiple steps to arrive at the desired product, and
heavy solvent use, API manufacturing does have a material utilisation efficiency and waste management issue.

The high values of these metrics need not be a problem if the margins in the business are used to fund the investments needed (in capex and
opex) for end-of-pipe waste treatments and/or the investments in alternate ‘green’ routes that impose less of an environmental burden. But it is a
reality of the business today that many API companies are under severe margin pressures – brought about largely by unbridled competition and
lack of portfolio differentiation – and are often forced to focus on short-term financial returns.
The refrain in government is that building a much larger industrial base for APIs, while carrying on in a manner as now, will pose unacceptable
environmental and health risks.
Assessing carbon footprint
Another aspect of API manufacturing gaining attention today – though only to a limited manner in India – is its extensive carbon footprint. While
the footprint of the petroleum, energy, petrochemicals and bulk chemicals business gets a lot of attention, the life sciences and healthcare industries
also have a significant impact – estimated at 4-5% of total global emissions. About a quarter of this can be attributed to API manufacturing.

According to an analysis by McKinsey, a consultancy, APIs account for nearly half the emissions in the purchased goods and services of pharmaceutical
companies (with excipients accounting for another 10%). Not all APIs are alike – small molecule APIs, made by traditional chemistry routes, and accounting
for roughly 70% of the market, have a higher carbon footprint than biologicals produced from cell cultures or small organisms.

In addition to process-related carbon emissions, treatment and disposal of the significant liquid and solid wastes – including solvents, water
and contaminated materials – also contributes to emissions. Solvent incineration alone emits 2-4 kg of carbon dioxide (CO ) per kg of solvent.
2
Lowering the carbon footprint
With the healthcare and life sciences industries looking to lower their carbon footprints, the pressure on API producers to do likewise will
intensify. And there is much that the API industry can do to address both waste generation and carbon footprint. McKinsey highlights four levers
that can together deliver up to 90% reduction in carbon emissions by 2040, with 30-50% reduction requiring minimal regulatory approval, and about
35% being cost-efficient.

Chemical Weekly August 13, 2024 135

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