Impact of Increasing Demand on NSAIDs—Ibuprofen and Paracetamol

Abstract

North America dominates the consumption ofnonsteroidal anti-inflammatory drugs(NSAIDs)—Ibuprofen and Paracetamol (Acetaminophen). This is majorly due tothedrugs being available over the counter. China is the major source of Paracetamol, followed by India, whereas India is the major source of Ibuprofen API. For the past two years, there hasbeenagradual increase in the unit prices of the APIsof these drugs;thishas impacted the selling price of formulations sold in the market. This article discusses the reasons for the increase in prices and its impact on the value chain.

Introduction

Paracetamol and Ibuprofen APIsare majorly used witharoughly 90percent global share in the pharmaceutical industry. Demand for the APIsof bothis growing exponentially. Rising need for combination drugs undertheNSAID therapeutic category also increases demand for the APIs to accommodate the global demand.This has led to an increase intheunit prices of the APIs. Also, the key raw materialsthat go into manufacturing the APIs haveseen an increase intheirunit pricesas well,directly affecting the API unit prices. Hence,suppliers of the commodities havestarted increasing their capacityto suffice global demand. Increasing Demand for NSAIDs—Ibuprofen and Paracetamol Currently,the global demand for both Paracetamol and Ibuprofen is higher thantheirglobal supply.

Theincrease in demand is attributed to the following factors:

• Wide usage of both drugs for pain, fever,and allergies as,being generic drugs, theyare available over the counter.
• The largest supplier of Paracetamol—Mallinckrodt—having 25,000 MT of capacity has shifted its growth strategy from generics to brands,leading to the supply crunch.
• BASF, one of the largest players of Ibuprofen,shut down its Ibuprofen plantafter facing technical issues,leading toamajor supply crunch in 2017.