In the 1990s, changes have occurred in the composition of the U.S. chemical industry. These include greater diversification into such high-technology fields as biotechnology, pharmaceuticals, and advanced materials that have applications in such industries as transportation and medicine. Almost all of the economic characteristics discussed above apply only to the industry s synthesized products. Although the bulk of the industry s sales are now in synthesized products, formulations developed from ancient empirical arts still play a role in the business. While formulation has not benefited as dramatically as synthesis from the scientific discoveries of the past two centuries, it too has benefited from advances in colloid chemistry, analysis, and the availability of new synthetic products.
Formulation involves a different set of economic characteristics than synthesis.
Most of its laboratory expenditures go toward development and testing rather than research, and its capital requirements are usually quite low. Most importantly, however, formulated products can achieve proprietary positions, especially when they are continually modified to meet customers changing needs and are sold with a high degree of service. They are, therefore, more insulated than synthetic chemicals from competitive pressures that depress prices and thus require compensating reductions in costs. Non-formulated products are excluded. Includes specialty products only.