Optimized physical properties (e.g., bulk, surface/interfacial, and mechanical properties) of active pharmaceutical ingredients (APIs) are key to the successful integration of drug substance and drug product manufacturing, robust drug product manufacturing operations, and ultimately to attaining consistent drug product critical quality attributes. However, an appreciable number of APIs have physical properties that cannot be managed via routes such as form selection, adjustments to the crystallization process parameters, or milling. Approaches to control physical properties in innovative ways offer the possibility of providing additional and unique opportunities to control API physical properties for both batch and continuous drug product manufacturing, ultimately resulting in simplified and more robust pharmaceutical manufacturing processes. Specifically, diverse opportunities to significantly enhance API physical properties are created if allowances are made for generating co-processed APIs by introducing nonactive components (e.g., excipients, additives, carriers) during drug substance manufacturing. The addition of a nonactive coformer during drug substance manufacturing is currently an accepted approach for cocrystals, and it would be beneficial if a similar allowance could be made for other nonactive components with the ability to modify the physical properties of the API. In many cases, co-processed APIs could enable continuous direct compression for small molecules, and longer term, this approach could be leveraged to simplify continuous end-to-end drug substance to drug product manufacturing processes for both small and large molecules. As with any novel technology, the regulatory expectations for co-processed APIs are not yet clearly defined, and this creates challenges for commercial implementation of these technologies by the pharmaceutical industry. The intent of this paper is to highlight the opportunities and growing interest in realizing the benefits of co-processed APIs, exemplified by a body of academic research and industrial examples. This work will highlight reasons why co-processed APIs would best be considered as drug substances from a regulatory perspective and emphasize the areas where regulatory strategies need to be established to allow for commercialization of innovative approaches in this area.