The pharmaceutical industry is emerging as a significant industrial sector with tremendous potential for providing innovative drugs to treat life-threatening diseases as well as for providing economical generic alternatives of supreme quality. Hence this sector is not only responsible to provide the much desired boost to the health of the society, especially of the developing countries, but also it is a competitive yet profitable sector from a business perspective. Currently, the primary focus of the pharmaceutical industry is to raise the bar for the quality, safety and efficacy of the drug products that are made available in the global market place. Product quality, price of raw materials [API (active pharmaceutical ingredient) and excipients] and market return competition are vital factors that determine the longevity or existence and profitability of a company in the crowded pharmaceutical market.. Hence these critical factors receive special consideration from drug product manufacturers. Active Pharmaceutical Ingredient (API) is the primary constituent of a pharmaceutical drug product that governs the final cost of the drug product as well as the commercial profit earned by the company. Most of the major generic drug manufacturing companies have their own API manufacturing facility and hence may not prefer to screen independent API suppliers as part of their generic drug development plan to procure additional API. Contradictorily, the generic drug manufacturers who do not synthesize the API themselves are dependent on external and independent API manufacturers for procurement of the API. Such generic drug manufacturing companies have to select suitable API suppliers by adapting a risk aversive approach. This article presents an informed and comprehensive discussion on the primary and alternate API supplier selection processes for generic drug products manufacturing firms. This API supplier selection process can be categorized into several stages which include preliminary assessment, documents review, samples analysis, onsite or offsite audit, results evaluation and final approval or rejection. This API selection process includes the anticipated product specific risk assessment with relation to API characteristics, specifications, analytical results, document review observations and inspection results. A generic drug product manufacturing company can choose an alternative API supplier or change the existing API supplier either during the development phase or after development of the drug product. Generic drug product manufacturing companies should rework on development activities if any API supplier change happens during the development phase. API supplier change or addition of an alternative API supplier has to be followed as per SUPAC guidance for US market and VARIATION filing procedures for European market.