Overview:

The history of the fine chemicals industry dates back to the late 18th century, when the early chemical industry was evolved from natural dyes and explosives into modern pharmaceutical products. However, by the end of the 19th century, the commercial production of branded pharmaceuticals flourished in Europe (especially in Germany, as many of the active pharmaceutical ingredients were produced in this country).
Fine chemicals are generally produced on a large scale, which can be measured in thousands of tonnes per year for certain food additives and drug intermediates. Fine chemicals manufacturing is typically carried out in batch processes, with synthesis being followed by separation and purification steps.
Pharmaceuticals has always been the largest market for the fine chemicals industry. Moreover, it is likely that pharmaceutical intermediates will account for over two-thirds of the fine chemicals market by 2012. Although the number of fine chemicals companies involved in the manufacture of high potency APIs (HPAPIs) has historically been limited, the segment has attracted more companies recently.
Profitability levels have fallen for many fine chemical companies in recent years. However, the recent focus on biopharmaceutical products holds promise for this industry in the future. For instance, many of the larger fine chemicals players have invested in biotechnology, either through self-funded R&D programs or through alliances and partnerships.

Key features of this report

• Overview of the global fine chemicals market
• Market dynamics and profitability of the global fine chemicals market
• Detailed profiles of the leading 10 players in the global fine chemicals market
• Key partnerships and M&A activities in the fine chemicals sector
• Key trends and opportunities in the global fine chemicals market

Scope of this report

• Develop insights into the global fine chemicals market, including pharmaceutical intermediates, agrochemical intermediates, flavors and fragrances, dyes, and others
• Build knowledge of key partnerships and M&A activities that are shaping the future of the global fine chemicals industry.
• Understand the major issues affecting the global fine chemicals industry.
• Assess the competitive landscape of the global fine chemical industry.

Key Market Issues

• Increasing demand for HPAPIs: HPAPIs are very effective in treating diseases at low dosage; however, the production of such potent compounds requires significant investment. Thus, many companies are also differentiating their products from their competitors through specialized technologies and demonstrated expertise. The growth in demand for HPAPIs, primarily in cancer therapies, is expected to increase its sales in the near future. Additionally, the ability to increase life expectancy among cancer patients will also drive the demand for HPAPIs in coming years.
• Relocation to emerging and fast growing markets: Managing and rationalizing existing assets in the EU and investing in new facilities in emerging and fast growing markets has been a key trend in the fine chemicals sector recently. Growth in Western Europe started to slow in recent years, making Asia (mainly China and India) and Latin American countries the new growth markets for the fine chemicals industry.
• Advanced technologies: Recently, many of the leading pharmaceutical and fine chemicals manufacturers have started to focus on small-scale complex products, an area where advanced technologies are required. For example, in June 2009, Italian fine chemicals company Endura announced that it would commercialize a technology that encapsulates insecticide into very small crystals. The encapsulation delays the release of insecticides, thus enabling an enzyme inhibitor to disable the enzymes that insects use to block pesticides. Moreover, Endura will also promote the concept of microencapsulated piperonyl butoxide (PBO, a naturally occurring synergist) in agriculture throughout the world in collaboration with strategic partners.

Key findings from this report

• The pharmaceutical industry has always been the largest market for the fine chemicals industry. Although the number of fine chemicals companies that are developing high-potency APIs has been limited, this segment has attracted many companies in recent years.
• Fine chemicals players with significant exposure to the generics segment are likely to face pressure on their profitability levels in the near future. However, the recent shift in focus toward biopharmaceutical products will expand the margin of this industry in coming years.
• Agrochemical intermediates represent the second largest category among fine chemicals (after APIs), the majority of which are used in the manufacture of pesticides, herbicides, insecticides, fungicides, and fumigates.
• Outsourcing has become a key trend in this industry, fueled by the growing importance of biopharmaceutical and virtual pharma companies in low-cost destinations such as Asia. Outsourcing from biotech and pharmaceutical companies will strengthen the custom manufacturing industry in India and China.
• BASF is one of the leading chemical producers in the world, with significant exposure in fine chemicals. With a presence in over 80 countries, BASF is one of the leading suppliers of chemical intermediates to the plastic, automobile, agriculture, and pharmaceutical industries.

Key questions answered

• What are the key trends of global fine chemicals industry?
• Which are the leading players in the global fine chemical market?
• Which companies will drive the future of the global fine chemicals market?
• What are the key strengths, weaknesses, threats, and opportunities for the leading fine chemicals players?
• How has the financial performance of leading players in the global fine chemicals market faired through the recent economic downturn?
• Which companies are best positioned to succeed in the global fine chemicals market during 2009–14?

The Top 10 Global Fine Chemicals Companies

Executive summary

Industry overview

BASF

Lonza

DSM

Sumitomo Chemical

Merck KGaA

Lanxess (Saltigo)

Sigma-Aldrich

Jubilant Organosys

Johnson Matthey

Evonik Chemicals

Chapter 1 Introduction

What is this report about?

Methodology

Chapter 2 Industry overview

Summary

Fine chemicals - an overview

Different types of fine chemicals

Pharmaceutical intermediates

Agrochemical intermediates

Flavors and fragrances

Dyes and others

Market dynamics

Size and structure

Profitability

Competitive landscape

Manufacturing standards and their potential benefits

Potential benefits of the guideline

Key partnerships and M&A activity in the fine chemicals sector

Key trends

Advanced technologies

Increasing demand for HPAPIs

Relocation to emerging and fast growing markets

Increasing use of biotechnology and nanotechnology

Chapter 3 BASF

Summary

Company overview

Business segmentation

R&D focus

Financial performance

Growth strategies

Leading supplier of chemical intermediates

Verbund, an innovative approach

Diversified product portfolio

SWOT analysis

Chapter 4 Lonza

Summary

Company overview

Business segmentation

R&D focus

Financial performance

Growth strategies

Chemical manufacturing strengthens Lonza’s technology platform

Partnership with biopharmaceutical and chemical companies

SWOT analysis

Chapter 5 DSM

Summary

Company overview

Business segmentation

R&D focus

Financial performance

Growth strategies

Increasing R&D activity in emerging markets

Microreactors: a new technology for pharmaceutical production

SWOT analysis

Chapter 6 Sumitomo Chemical

Summary

Company overview

Business segmentation

R&D focus

Financial performance

Growth strategies

Strong progress in major R&D projects

Pursuing a new strategy of creative hybrid chemistry

Strong response to the EU’s REACH legislation for chemicals

Creation of next-generation chemical safety information management database

SWOT analysis

Chapter 7 Merck KGaA Chemicals

Summary

Company overview

Business segmentation

R&D focus

Financial performance

Growth strategies

Merck KGaA and Millipore partnership for specialty products

New pharmaceutical production plant to increase Merck KGaA’s capacity in

Germany

Stronger presence in India through acquisition of Bangalore Genei

Merck Serono to build its R&D operations in China

SWOT analysis

Chapter 8 Lanxess (Saltigo)

Summary

Company overview

Business segmentation

R&D focus

Financial performance

Growth strategies

Expansion in BRIC countries

Advanced Intermediates segment

Custom manufacturing

SWOT analysis

Chapter 9 Sigma-Aldrich

Summary

Company overview

Business segmentation

R&D focus

Financial performance

Growth strategies

Strong focus on emerging markets

Partnerships and alliances

Targeting the high-growth biology segment

SWOT analysis

Chapter 10 Jubilant Organosys

Summary

Company overview

Business segmentation

R&D focus

Financial performance

Growth strategies

Integrated business model

Strong R&D and manufacturing services for intermediates and APIs

Positioning as an outsourcing partner of choice

SWOT analysis

Chapter 11 Johnson Matthey

Summary

Company overview

Business segmentation

R&D focus

Financial performance

Growth strategies

Johnson Matthey’s Sustainability 2017 initiative

Strong market position in APIs and contract manufacturing services

SWOT analysis

Chapter 12 Evonik Chemicals

Summary

Company overview

Business segmentation

R&D focus

Financial performance

Growth strategies

Specialty chemicals remain a key focus area for Evonik

Strong commitment to custom manufacturing business

SWOT analysis

Chapter 13 Other major players

Boehringer Ingelheim

Company overview

Recent financial performance

Divis Laboratories

Company overview

Recent financial performance

Pfizer CentreSource

Company overview

Recent financial performance

Cambrex

Company overview

Recent financial performance

Fabbrica Italiana Sintetici

Company overview

Recent financial performance

Appendix

Glossary

Index

List of Figures

Figure 2.1: Fine chemicals and their usage

Figure 3.2: BASF SWOT analysis

Figure 4.3: Lonza business divisions

Figure 4.4: Lonza SWOT analysis

Figure 5.5: DSM business focus

Figure 5.6: DSM SWOT analysis

Figure 6.7: Sumitomo Chemical research laboratories

Figure 6.8: Sumitomo Chemical SWOT analysis

Figure 7.9: Merck KGaA Chemicals SWOT analysis

Figure 8.10: Saltigo SWOT analysis

Figure 9.11: Sigma-Aldrich SWOT analysis

Figure 10.12: Jubilant Organosys business segmentation

Figure 10.13: Jubilant Organosys SWOT analysis

Figure 11.14: Johnson Matthey business segmentation

Figure 11.15: Johnson Matthey SWOT analysis

Figure 12.16: Evonik Chemicals SWOT analysis

List of Tables

Table 2.1: Global fine chemicals market size, 2009-2015

Table 2.2: Leading 10 global fine chemicals companies, 2009

Table 3.3: BASF snapshot

Table 3.4: BASF financial performance by segment, 2009

Table 3.5: BASF chemical sales performance, 2009

Table 4.6: Lonza snapshot

Table 4.7: Lonza financial performance by operating segments, 2009

Table 5.8: DSM snapshot

Table 5.9: DSM key launches in 2009

Table 5.10: DSM R&D expenditure, 2009

Table 5.11: DSM financial performance by segment, 2009

Table 5.12: DSM fine chemicals performance by segment, 2009

Table 6.13: Sumitomo Chemical snapshot

Table 6.14: Sumitomo Chemical financial performance by operating segments, FY 2008

Table 6.15: Sumitomo Chemical financial performance during FY 2004-2008

Table 7.16: Merck KGaA Chemicals snapshot

Table 7.17: Merck KGaA sales performance, 2009

Table 7.18: Merck KGaA Chemicals segmentation sales performance, 2009

Table 8.19: Lanxess (Saltigo) snapshot

Table 8.20: Lanxess financial performance by operating segments, 2009

Table 9.21: Sigma-Aldrich snapshot

Table 9.22: Sigma-Aldrich financial performance by operating segments, 2009

Table 10.23: Jubilant Organosys snapshot

Table 10.24: Jubilant Organosys financial performance by operating segments, FY 2009

Table 10.25: Jubilant Organosys financial performance during FY 2005-2009

Table 10.26: PLSPS revenue distribution by segments, FY 2009

Table 10.27: CRAMS revenue distribution by segments, FY 2009

Table 11.28: Johnson Matthey snapshot

Table 11.29: Johnson Matthey financial performance by operating segments, FY 2008

Table 12.30: Evonik Industries snapshot

Table 12.31: Evonik Industries financial performance by operating segments, 2009

Table 12.32: Evonik Chemicals financial performance by segments, 2009

Table 13.33: Boehringer Ingelheim snapshot

Table 13.34: Boehringer Ingelheim financial performance by operating segments, 2009

Table 13.35: Divis Laboratories snapshot

Table 13.36: Divis Laboratories financial performance, FY 2008

Table 13.37: Pfizer CentreSource snapshot

Table 13.38: Cambrex snapshot

Table 13.39: Cambrex segmental revenue, 2009

Table 13.40: Fabbrica Italiana Sintetici snapshot