Aspirin

Aspirin Global Market Outlook:

• The global market size is $2.21 billion in 2021, growing at a rate of 2.4 percent, due to increased demand from the pharmaceutical industry

• Market is consolidated with a few major players holding around 70 percent of the market

• Globally, suppliers have over 40,000 MT capacity, however, the demand is around 28, 000 MT, thus, there is no major supply crunch expected in the next few years

• In response to an increase in demand for aspirin API during the COVID-19 pandemic, the suppliers are operating at a higher operating rate

Global Aspirin Suppliers

• Market is consolidated with few major players holding around 70 percent of the market

• Globally, suppliers have over 40,000 MT capacity, however, the demand is around 28, 000 MT, thus, there is no supply crunch expected in the next few years

• China, Spain, France, and Thailand contribute to 93 percent of the global production

Aspirin Cost Structure

Raw material is the major contributor in the cost of production of aspirin API. The fixed cost, i.e., the equipment and the facility cost, is the other major cost component in the manufacturing.

Cost Drivers

• The raw materials, i.e., salicylic acid, acetic anhydrite, acetic, and solvents, contribute to 60 percent of the overall cost. Salicylic acid, the key raw material, contributes to approx. 90 percent of the raw material cost

• The equipment, facility cost, and the regulatory expenses are included in the fixed cost component. The fixed cost contributes to 23 percent of the overall manufacturing cost of aspirin

• The labor cost contributes to 10 percent of the manufacturing expenses. This share would decrease in low-cost countries, like China, India, etc.

Porter's Analysis on Aspirin

Supplier Power

• The market of Salicylic Acid used in the manufacture of Aspirin is fragmented with many players available in the market

• Some of the key market players also have salicylic acid in their product portfolio

• Salicylic Acid is majorly used in pharmaceutical manufacturing. The demand from other industries is minimal

• Hence, the suppliers of Aspirin raw materials has lower power

Barriers to New Entrants

• Consolidated Market: The Aspirin API market is consolidated with the top three players, holding close to 70 percent of the market share

• The top players have all the required regulatory certifications and an established consumer base

• Capital investment and competition are the major barriers for the new entrants in the market

Intensity of Rivalry

• Consolidated Market: As the marker is consolidated, each of the regulated suppliers have significant marker share. Hence, there is no problem of price competition

• Capacity Expansion: The established suppliers have been increasing their manufacturing capacities in response to the growing market demand

Threat of Substitutes

• Aspirin, being used for a wide range of indications, has lower risk of substitution, due to the low toxicity profile and established usage among the health care professionals

• However, the novel molecules, being introduced in the market for cardio vascular indication, etc., could effect the market size

Buyer Power

• The buyer has medium power, since the market is consolidated with lower number of regulated suppliers and their high market share