AZELAIC ACID MARKET ANALYSIS

The azelaic acid market size is expected to reach US$ 353.0 Mn by 2031, from US$ 210.0 Mn in 2023, at a CAGR of 7.7% during the forecast period.

Azelaic acid is a naturally occurring acid with anti-inflammatory and antimicrobial properties. This acid is used in treating skin conditions such as rosacea and acne due to its comedolytic, keratolytic, and antioxidant effects commonly found in hair care products.

Azelaic Acid Market Regional Insights:

• North America is the largest market for azelaic acid, accounting for a market share of 38.7% in 2023 with the U.S. being a major contributor to the market growth over the forecast period owing to the presence of major players. The region's growth is driven by factors such as the growing use of tanning agents and rising demand in the cosmetic industry.
• Europe accounted for a market share of 23.0% in 2023 Due to the variety of applications provided by end-use industries, Europe provides ample opportunities for key players in the azelaic acid market, such as those from Germany, France, and other regions. Over the next decade, there will be numerous mergers and acquisitions among core players in these regions.
• Asia Pacific accounted for a market share of 20.0% in 2023. In Asia Pacific region, countries such as India and China offer exciting investment opportunities. India’s economy is expected to experience a substantial compound annual growth rate over this timeframe while China follows behind.

Figure 1. Azelaic Acid Market Share (%), by Region, 2024

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Azelaic Acid Market- Analyst’s Views:

The azelaic acid market is expected to experience stable growth over the forecast period, driven by the increasing demand for skin lightening and the treatment of hyperpigmentation and acne. The wide application of azelaic acid in the pharmaceutical as well as cosmetic industries is anticipated to support market expansion. Furthermore, rising awareness about the benefits of azelaic acid for various skin problems is projected to fuel the sale opportunities. However, stringent regulations pertaining to the use of azelaic acid may pose a challenge to smooth market growth. Additionally, the availability of alternative products for acne treatment and skin lightening may also restrict the market revenue to some extent. Europe and North America are also estimated to contribute significantly to the global market owing to the increased adoption of premium skin care products in these regions. The emerging economies of Latin America and the Middle East & Africa are pegged to generate lucrative opportunities for azelaic acid suppliers during the forecast timeframe. Overall, the global azelaic acid market is anticipated to experience steady performance, subject to regulatory support for new applications and expanding distribution networks in developing regions.

Azelaic Acid Market Drivers:

Growing use as tanning agent: The use of azelaic acid as a tanning agent has been steadily increasing over the past few years, thus driving the azelaic acid market growth. Azelaic acid is a naturally occurring dicarboxylic acid found in wheat, rye, and barley. It produces a melanin-based tanning effect when applied topically on the skin.

The growing demand for natural tanning ingredients is driving more individuals to opt for azelaic acid-based tan inducing products over traditional self-tanning or Ultraviolet tanning methods. Research by the Canadian Dermatology Association in 2022 found that over 50% of Canadians who used tanning products in the last year opted for sunless tanners to get a natural looking tan in a safer way. This increased consumer preference for natural alternatives is benefiting the azelaic acid market. The compound is also safe for sensitive skin types and does not produce the orange or green hues that some other self-tanner active ingredients can cause. For instance, the World Health Organization has regularly highlighted the health risks of UV tanning in its reports published between 2020 and 2022, reinforcing the shift toward safer melanogenesis promoting ingredients.

Rising demand in cosmetic industry: The growing cosmetic industry globally has been a major factor driving the demand for azelaic acid in recent years. With an increasing focus on natural and plant-based ingredients in cosmetic products, azelaic acid has emerged as a popular choice due to its numerous skin benefits.

Azelaic acid is now widely used in various skin care products like creams, lotions, and serums due to its effectiveness in treating various dermatological conditions like acne, hyperpigmentation, and rosacea. Its non-irritating properties and natural origin appeal to many cosmetic brands as well as consumers. Azelaic acid works as an effective anti-inflammatory and helps control sebum production, reducing breakouts and flare-ups of acne lesions. It is also effective in fading the appearance of scars and pigmentation caused by acne.

The rising demand for cosmetic products that deal with pigmentation, anti-aging, and protection from pollutants has significantly contributed to the uptake of azelaic acid globally. For instance, as per a report published by NCBI in 2023, about 40% of women globally are affected by melasma and hyperpigmentation disorders, which pushes them to use topical treatments and cosmetics containing azelaic acid. This has created sizable opportunities for azelaic acid manufacturers.

Azelaic Acid Market Opportunities:

Emerging applications in pharmaceuticals industry:

The pharmaceutical industry is constantly innovating and exploring new drug development opportunities. One area that holds great promise is in using azelaic acid for various dermatological conditions. Azelaic acid has shown effectiveness in treating acne and hyperpigmentation issues like melasma and rosacea. As the demand for safer, natural skincare solutions grows, the use of azelaic acid as an active ingredient is gaining more acceptance. According to the National Eczema Association, over 31 million Americans suffer from eczema or atopic dermatitis. Recent clinical trials have demonstrated azelaic acid's potential as a treatment either as a monotherapy or as an adjunct therapy for eczema. Its anti-inflammatory and antimicrobial properties make it a suitable candidate. As research advances, new applications for azelaic acid are emerging beyond dermatology as well. Some studies show its efficacy against antibiotic-resistant bacteria like Methicillin-Resistant Staphylococcus Aureus (MRSA). Given the increasing global threat of antimicrobial resistance, exploring azelaic acid and other natural compounds could offer alternatives. Additionally, its ability to inhibit the growth of cancerous melanoma cells indicates future potential in oncology. Pharmaceutical companies are investing more in naturally-derived drugs due to factors like safety, sustainable sourcing, and government initiatives like the FDA's (Food and Drug Administration) “Drugs of Botanical Origin” program. This underscores the growing market potential for azelaic acid and drives demand, which positively impacts producers and manufacturers.

New product launches: The azelaic acid market has significant potential for growth through new product launches that address unmet needs. With rising skin concerns among various age groups and growing demand for natural remedies, azelaic acid emerged as a promising active ingredient. However, traditional topical formulations have faced challenges like skin irritation, which has limited wider acceptance.

For example, encapsulating microparticles or nanoparticles of azelaic acid could provide controlled release within the epidermis to reduce irritation. Combining it with soothing botanical extracts in gentle cream or lotion bases may also improve tolerability. Developing customized product lines targeting specific conditions could boost usage. For example, adding tyrosinase-inhibiting plant extracts for hyperpigmentation or antibacterial plant oils for acne-prone skin. Adopting sustainable and eco-friendly packaging would cater to evolving consumer preferences.

Azelaic Acid Market Trends:

Increasing preference for natural ingredients in cosmetics: The increasing preference for natural ingredients among consumers is having a notable impact on the azelaic acid market. More individuals are actively seeking out skin and hair care products with natural formulations that are free of harmful chemicals. This aligns with azelaic acid's position as a naturally-derived acid that offers several skin benefits.

 Azelaic acid is found naturally in wheat and barley and provides anti-inflammatory, antibacterial, and antiproliferative properties when used in cosmetic products. As consumers become more educated on the importance of using gentle, natural acids in skincare, azelaic acid serves as an appealing alternative to other exfoliants that contain synthetic acids. Its natural origin allows brands to market products with azelaic acid as ‘natural’ or ‘clean,’ which carries significant weight among conscientious buyers.

The growing emphasis on natural ingredients has spurred cosmetic companies to diversify their portfolios with natural acid options like azelaic acid. Mainstream brands and niche natural labels alike are responding to customer demand by launching or expanding azelaic acid product lines. For example, The Ordinary, a popular skincare brand known for affordable naturally-derived formulas, recently released an azelaic acid suspension. This launch was driven by strong interest from consumers seeking multi-purpose chemical exfoliants from natural sources.

Focus on clinical trials and new applications: Azelaic acid is being increasingly used in clinical trials for various dermatological conditions beyond its traditional use for acne treatment. This emerging trend is positively influencing the growth of the azelaic acid market.

Researchers and pharmaceutical companies are exploring new therapeutic applications of azelaic acid. For instance, according to a study published by the National Center for Biotechnology Information (NCBI) in 2021, azelaic acid is being clinically tested for its efficacy in treating various inflammatory and hyperpigmentation conditions like rosacea, melisma, and post-inflammatory hyperpigmentation. Some key ongoing clinical trials mentioned in the NCBI study include trials exploring azelaic acid for the treatment of rosacea and melisma. This increased focus on clinical trials for newer disease applications is encouraging more research and development activities related to azelaic acid. It is also generating greater awareness about the multi-functional benefits of azelaic acid among both healthcare professionals and patients. For example, according to the American Academy of Dermatology, searches for azelaic acid on their website grew significantly from 2020 to 2021, reflecting increased interest in learning more about its efficacy for alternative uses beyond acne. This rise in new clinical applications and positive awareness is attracting more companies to invest in this market.

Azelaic Acid Market Restraints:

Availability of substitutes: Availability of substitutes is posing a significant challenge for the growth of the azelaic acid market. There are several alternatives available for azelaic acid that perform similar functions. Some key substitutes include glycolic acid, salicylic acid, lactic acid, and citric acid. These acids are commonly used in chemical peels, anti-aging creams, and acne treatments. Glycolic acid, in particular, is considered a very close substitute for azelaic acid as both are Alpha Hydroxy Acids (AHAs) and offer similar exfoliating benefits. Glycolic acid has established itself as the most widely used AHA and its market is growing at a faster pace compared to azelaic acid.

Additionally, there is an availability of acid combinations that are multi-functional and show results comparable to single acids like azelaic acid. For instance, cosmetic companies are introducing polyhydroxy acid combinations containing glycolic, lactic, and citric acids. These blend of AHAs cater to various skin issues in one product. Such multi-benefit formulations further affect the potential customer base of azelaic acid. Unless azelaic acid formulations are upgraded in terms of availability through mainstream channels, affordability and enhanced functionalities, it will find limited success against existing strong substitutes in the coming years.

Stringent regulations on cosmetic ingredients: Stringent regulations imposed by various government bodies around the world on the types and concentration of ingredients used in cosmetic products has adversely impacted the growth of the azelaic acid market. Azelaic acid is frequently used in cosmetic formulations for its anti-acne and skin lightening properties. However, different jurisdictions have put in place diverse guidelines on maximum allowable percentages of azelaic acid in leave-on and rinse-off cosmetic products. For instance, the European Union has limited the use of azelaic acid to 10% concentration in leave-on cosmetics and 15% in other products. Similarly, countries like Brazil and South Korea have their own restrictive norms.

Further, governments are increasingly banning the use of certain preservatives and chemicals in view of their environmental and health impacts. For example, the U.S. Environmental Protection Agency (EPA) has issued directives prohibiting the use of several common preservatives like parabens and phthalates in personal care items since 2020. 

Recent Developments:

• In June 2023, Hubei TuoChu Kangyuan Pharmaceutical Co., Ltd. announced that it had received a patent for a new process for producing azelaic acid from renewable feedstock. This new process is expected to be more environment-friendly and cost-effective than traditional methods of producing azelaic acid. Hubei TuoChu Kangyuan Pharmaceutical Co. Ltd. manufactures and distributes traditional Chinese medicines. The company produces nourishing drugs, exterior plasters, loratadine syrup, food supplements, and others. Hubei TuoChu Kangyuan Pharmaceutical Co., Ltd. conducts business in China.
• In March 2023, Emery Oleochemicals announced expansion of its production capacity for azelaic acid at its plant in Cincinnati, Ohio. This expansion is expected to be completed in 2024 and is expected to double the company’s azelaic acid production capacity. Emery Oleochemicals is a global specialty chemical manufacturer that offers a diverse product portfolio, including renewable solutions for various markets such as Agro Green, Bio-Lubricants, Eco-Friendly Polyols, Green Polymer Additives, Home & Personal Wellness, and OleoBasics. The company's EMEROX 1144 azelaic acid is a crucial component for complex grease thickener systems and has been added to the European Ecolabel LuSC-List, which designates environmentally acceptable lubricants. Emery Oleochemicals' azelaic acid is widely used as a complexing agent for lithium complex grease, providing high dropping points, improved mechanical stability, water resistance, and oil separation properties.

Mergers and Acquisition:

• In February 2023, Matrica announced partnership Collistar to develop a new line of azelaic acid-based skincare products. This new product line is expected to be launched in early 2024.
• Collistar is an Italy-based beauty brand that was founded in Milan in 1983 and is a part of the Bolton Group, Italian conglomerate that sells products under more than fifty brands. The brand is active in Italy and over 45 countries, with 19 years of leadership in Italy. Collistar offers a wide range of beauty products, including treatments for the face, body, hair, makeup, aromatherapy, and solar products. The company is committed to finding simple and pure cosmetic solutions, combining maximum effectiveness with maximum tolerability, and it abides by Bolton Group's sustainable development plan, respecting the planet's resources and protecting present and future generations.

Figure 2. Azelaic Acid Market Share (%), by Application, 2024

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Top Companies in the Azelaic Acid Market:

• BASF SE
• Croda International plc
• Emery Oleochemicals
• Haihang Industry Co., Ltd
• Jiangsu Senxuan Pharmaceutical and Chemical Co., Ltd.
• Matrica S.p.A.
• Nantong Hengxing Electronic Materials Co., Ltd.,
• Nantong Jinghua Pharmaceutical Co., Ltd.,
• Wufeng Chicheng Biotech Co., Ltd.
• Xi'an Sonwu Biotech Co., Ltd.

*Definition: Azelaic acid is an organic compound with the molecular formula C9H16O4 saturated dicarboxylic acid, and it exits as a powder. Azelaic acid has significant biological activities and is found in daily food products such as barley, wheat, and rye. Azelaic acid is an inhibitor of enzymes in the respiratory chain as well as DNA synthesis. Azelaic acid is manufactured from oleic acid in the presence of ozone, which acts as a catalyst during the reaction.