REPORT BIOCIDES IN PERSONAL CARE PRODUCTS 2017

REPORT BIOCIDES IN PERSONAL CARE PRODUCTS 2017 Prepared by: Biocide Information Limited Email: info@biocide-information.com More about us on www.biocide-information.com

GLOBAL SUMMARY BIOCIDES IN PERSONAL CARE PRODUCTS Market Size 2017: Active Ingredient $ 954 million BIOCIDE SALES BY REGION: Table 1: Biocide Sales by Region for Personal Care Products REGION SALES ($M) AMERICAS 306 ASIA PACIFIC 328 EUROPE 320 BIOCIDE SALES BY LEADING ACTIVE INGREDIENT: Table 2: Biocide Sales by Type Alcohol 187.0 CMIT/MIT 38.0 Formaldehyde Releasers 81.0 Organic Acids 173.0 Parabens 65.0 Quats 51.0 Zinc Pyrithione 113.0 BIOCIDE SALES BY LEADING ACTIVE INGREDIENT SUPPLIER: Table 3: Biocide Sales by Manufacturer COMPANY SALES ($M) Ashland 68.0 Clariant 42.0 Lonza 199.0 Schulke & Mayr 58.0 Thor 54 Outlook for the future: The market for Biocides in Personal Care is expected to grow 2 % per year despite the Personal Care industry continuing to focus on developing preservative free cosmetics. This focus will result in the continual movement towards substituting conventional Biocides with milder biocides and multifunctional ingredients with antimicrobial activity and/or boosters. There is a trend in the development of delivery technologies for active ingredients and using packaging to reduce Biocide usage. CHAPTER 12 2 www.biocide-information.com

TABLE OF CONTENTS 1 INTRODUCTION & METHODOLGY...4 1.1 OBJECTIVES...4 1.2 METHODOLOGY...4 1.3 ACCURACY OF THE INFORMATION...4 1.4 DEFINITIONS...4 2 END USER ANALYSIS...6 2.1 TARGET MARKET...6 2.2 GLOBAL ANALYSIS...7 2.2.1 Leading Personal Care Manufacturers...8 2.2.2 Biocides Used by Leading Personal Care Companies...9 3 BIOCIDE COMPARISON...10 3.1 PRESERVATIVES...10 3.2 ANTI-MICROBIAL COSTS IN SYSTEM...11 4 BIOCIDE CONSUMPTION...12 4.1 GLOBAL AND REGIONAL ANALYSIS...12 4.2 MULTI-FUNCTIONAL INGREDIENTS...18 4.2.1 Preservative free Personal Care Products...27 4.3 BIOCIDE CONSUMPTION AT END-USER LEVEL...28 5 BIOCIDE MANUFACTURERS...29 6 DISTRIBUTION...44 7 VALUE CHAIN ANALYSIS...46 8 REGULATORY ANALYSIS...48 9 TRENDS...50 10 FUTURE...53 10.1 FUTURE FOR PERSONAL CARE PRODUCTS...53 10.2 BIOCIDE GROWTH...54 CHAPTER 12 3 www.biocide-information.com

1 INTRODUCTION & METHODOLGY 1.1 OBJECTIVES The key objectives of this study were: 1. To provide marketing data on biocides, major personal care products using biocides, suppliers and customers. 2. To identify and analyse the trends taking place within the biocides industry. 3. To define the distribution channels in the industry. 1.2 METHODOLOGY The report is based on over 30 interviews conducted throughout the globe. In each industry analysis, BI contacted Personal Care Product manufacturers, biocide manufacturers, Suppliers, Distributors and trade associations by telephone and conducted unstructured interviews typical of the type used in industrial market research. In addition to interviews, the report also summarises suppliers' product literature, data from trade associations, BI databases and our monthly information report. 1.3 ACCURACY OF THE INFORMATION BI believes our estimates to be within 20% of the actual value. The accuracy of the information is dependent on many factors such as the number of interviews conducted per application, industry concentration and industry usage patterns. In order to increase our accuracy, BI increases the number of end-user interviews where an industry is fragmented and continues to interview until there is similarity in responses. Also all conclusions and data per industry were confirmed with the key manufacturers of biocides. 1.4 DEFINITIONS Biocide manufacturers are defined as companies who manufacture biocide active ingredients in-house. For example Ashland, BASF, Clariant, Corbion, DowDuPont, Emerald Kalama, Galaxy, Guangzhou Tinci, Lanxess, Lonza, Merck, Salicylates, Schulke, Shandong Ailitong, Sunpu, Symrise, Thor and Vivimed. CHAPTER 12 4 www.biocide-information.com

Biocide Blenders / Formulators are defined as companies whose majority of sales comes from purchasing biocides which they blend into their own products. For example Chemipol, Induchem, Inolex, Jeen, Lincoln Manufacturing, Lipo, Protameen, Rita, Schulke & Mayr, Sharon Laboratories and Tri-K etc. Distributors act as agents for both active manufacturers and biocide blenders. They are the most popular choice of supplier for small end-users. Distributors sell a range of additives and so will be making deliveries to end users and therefore biocides tend to be combined with other products which allow the distributor to be competitive. Prices are in U.S. dollars and are at active manufacturer level unless stated. The exchange rates used are as in Table 4 Table 4: Currency Conversion Rates $ Currency 1 0.94 EUR 1 6.94 CNY 1 116.95 JPY 1 0.81 GBP Source: www.xe.com Volumes are reported in tonnes based on a 100% active biocide basis. In the case of formulated products, the data is reported with a typical percentage of the formulated product. CHAPTER 12 5 www.biocide-information.com

2 END USER ANALYSIS 2.1 TARGET MARKET Biocides are used in personal care applications to inhibit or kill microorganisms in the product while a smaller amount are used to inhibit or kill microorganisms on the end user. The specific functionality in the product determines a biocide's status as a bacteriostat, antidandruff agent or preservative. As a result, the biocides analysed in this report can be classified into three main types: (1) Preservatives (2) Bacteriostats (3) Antidandruff Agents. Preservatives are used in the majority of personal care products while a limited range of personal care products contain bacteriostats and antidandruff agents. For example, antidandruff shampoos contain a preservative in addition to an antidandruff agent. The personal care industry is comprised of a wide variety of products used to cleanse, protect or beautify the body. Personal care products are generally classified into four categories: (1) Toiletries (2) Skin Care (3) Colour Cosmetics (4) Fragrances. Toiletries are the largest group within the personal care industry and include such products as shampoos, mouthwashes and deodorants. Typically formulated with aqueous compounds, toiletries are particularly susceptible to microbial contamination. The majority of toiletries must have biocides to protect them before and during usage. Skin care products are used to soothe and refresh the skin. They are also formulated with aqueous compounds and therefore must have effective and long lasting preservation systems to protect the products before and during consumer use. Colour Cosmetics include face makeup, lipstick and nail colouring. They are not normally formulated with aqueous compounds but may become contaminated with water during use and must therefore be preserved. Preservatives are used in these formulations to prevent contamination with potentially pathogenic microbes e.g. eye makeup preservation as the eye is vulnerable to microbes such as Pseudomonas. The most common microbial contaminants that personal care products can be exposed to are described in the following table:. Table 5: Main Microbes Found in Personal Care Products BACTERIA MOLDS YEAST Aerobacter spp. Alternaria spp. Candida spp. Alcaligines spp. Aspergillus spp. Cryptococcus spp. Bacillus spp. Botrytis spp. Saccharomyces spp Escherichia spp. Cladosporium spp. Zygosaccharomyses Pseudomonas spp. Mucor spp. Sarcina spp. Penicillium spp. Staphylococcus spp. Rhizopus spp. CHAPTER 12 6 www.biocide-information.com

2.2 GLOBAL ANALYSIS The global personal-care market, which includes skin-care, hair-care, fragrance, makeup, and personal-hygiene products, is valued at $ 458 billion at retail level according to Euromonitor. The largest geographical market for personal care products is Asia Pacific with total sales of $ 120 billion as seen in the following table:. Table 6: Personal Care Sales by Region at Retail Level ($ bn) REGION SALES IN $ bn Africa / Middle East 20 Australasia 7 West Europe 110 East Europe 32 Asia Pacific 120 North America 85 Latin America 56 TOTAL $458 bn For the future, the main growth markets for personal care products will be in the developing regions such as Asia Pacific, Africa / Middle East, Eastern Europe and Latin America. CHAPTER 12 7 www.biocide-information.com

2.2.1 Leading Personal Care Manufacturers The personal care industry is quite fragmented with the top 27 manufacturers having 50 % of the market. The leading manufacturer of Personal Care products is Procter & Gamble as illustrated in the following table:. Table 7: Top 27 Global Manufacturers in the Personal Care Industry COMPANY SALES IN $ BN Procter & Gamble 64.6 Unilever 26.2 L Oreal 24.3 Colgate Palmolive 13.3 Reckitt Benckiser 13.0 Henkel 9.9 Kao 8.8 Avon 7.7 Estee Lauder 7.7 Johnson & Johnson 7.2 Beiersdorf 6.9 Shiseido 6.8 Amway 5.7 LVHM 3.9 Coty 3.8 Glaxo 2.7 Limited Brands 2.7 Yves Rocher 2.7 Mary Kay 2.5 Oriflame 1.8 Chanel 1.5 Clarins 1.4 Puig 1.3 Revlon 1.3 Elizabeth Arden 1.1 Pierre Fabre 1.1 PZ Cussons 1.0 Total for top 27 230.9 All of the leading Personal Care manufacturers have achieved their high market penetration via acquisition. CHAPTER 12 8 www.biocide-information.com

2.2.2 Biocides Used by Leading Personal Care Companies The Biocides used by the leading personal care companies are shown in the following table:. Table 8: Biocides used by Leading suppliers of Personal Care Products Company Product Biocide Alberto Culver VOS Shampoo DMDM Hydantoin Aveda Foot Care Salicylic acid, Lactic acid Andrew Jergens Jergens Hand Cream Parabens Bausch & Lomb Curel skincare Parabens Beiersdorf Nivea skincare Benzyl Alcohol, Sodium Benzoate Beiersdorf Active Clean Phenoxyethanol, Methylparaben, Ethylparaben, Sodium Benzoate. Colgate-Palmolive Shower Gel MIT, Sodium Benzoate Dep Agree Shampoo CMIT/MIT Dial Corporation Dial Deodorant Triclocarban Henkel Shower Gel Benzyl Alcohol, Phenoxyethanol, Sodium Benzoate Henkel Apres Shampoo Phenoxyethanol, Potassium sorbate, Methylparaben Helene Curtis Suave Shampoo CMIT/MIT, DMDM Hydantoin Johnson & Johnson ph 5.5 deodorant Citric Acid, Sodium Benzoate Baby Shampoo Citric Acid, Sodium Benzoate L Oreal Elvive Revitalising Shampoo DMDM Hydantoin, Parabens L Oreal Shampoo Benzoic Acid, Benzyl Alcohol, Salicylic Acid L Oreal Synergie Cleansing Imidiaz Urea, Parabens Maybelline Lipstick Parabens Mennen Speed Stick deodorant Triclosan Procter & Gamble Head & Shoulders CMIT/MIT, Zinc Pyrithione, Sodium Benzoate UniLever Alberto Balsam Shampoo CMIT/MIT, DMDM Hydantoin, Sodium Benzoate UniLever Lynx Showergel Bronopol UniLever AntiBacterial Lever 2000 Triclosan Unilever Radox Shower Gel Benzyl Alcohol, Sodium Benzoate Unilever TRESemme Conditioner CMIT/MIT,DMDM Hydantoin, Phenoxyethanol Warner Lambert Oraldene Mouthrince Hexetidine Listermint Cetylpyridinium chloride Warner Wellcome Lubridem skincare Parabens CHAPTER 12 9 www.biocide-information.com

3 BIOCIDE COMPARISON 3.1 PRESERVATIVES Preservatives are used in personal care products to prevent product spoilage by microbial contamination and growth. Preservatives are selected for their ability to kill contaminating bacteria, fungi and molds over the use-life of the products, while not exhibiting skin irritation or sensitization. It is commonly accepted that different biocides will not perform equivalently in any given system, making a true comparison of cost effectiveness impossible. However, the relative costs can be approximated by comparing suppliers prices and recommended use levels for the most typical personal care formulations. Some common preservatives used in personal care formulations are shown along with their trade name, suppliers and prices in the following table:. Table 9: Comparison of Preservatives used in Personal Care Chemistry Trade Name Supplier % AI in Formulated Price formulation $/Kg 2-Brono-2-nitro propane-1,3 diol Bronopol BASF 100% 8 Benzoic acid, Euxyl K701 Schulke & Mayr 12 dehydroacetic acid, ethylhexylglycerin, phenoxyethanol CMIT/MIT Kathon CG DOW 1.5% 5 DMDM Hydantoin Glydant Lonza 55% 8 Diazolidinyl Urea Germall 11 Ashland 100% 10 Imidazolidinyl Urea Germal 115 Ashland 100% 10 Methyl paraben Nipastat Clariant 100% 4 Propyl paraben Nipastat Clariant 100% 4 Phenoxyethanol Phenoxetol Clariant 99% 6 Quaternium 15 Dowicil 200 Dow 95% 20 CHAPTER 12 10 www.biocide-information.com

3.2 ANTI-MICROBIAL COSTS IN SYSTEM Biocides are included in raw material costs and as shown in the following table, the cost of treating personal care products with a preservative ranges between $ 5 per tonne to $120 per tonne and amounts to a maximum 3% of raw material costs (Assume costs of raw materials is $4,000 / tonne). The costs of using antidandruff agents is more expensive than preservatives and can be up to 22% of the total raw material costs as shown in the following table:. Table 10: Biocides as a percentage of Personal Care raw material costs Biocide Sales price ($/Kg) Dosage Rate (%) Cost of biocide per T of personal care ($) Percentage of ** raw material costs Imidazolidinyl urea 10 0.30 30.75% (100% ai) CMIT/MIT (1.5% ai) 5 0.1 5 0.15% Bronopol 10 0.1 10 0.3% Parabens 4 0.3 12 0.4% Phenoxyethanol 6 1 60 1.5 % *Phenoxyethanol, Benzoic Acid, Dehydroacetic acid, ethylhexylglycerin Biocide Triclosan in oralcare (99% ai) Biocide 12 1 % 120 3 % BACTERIOSTATS Sales price Dosage Rate Cost of biocide Percentage of ($/Kg) (%) per T ($) raw material costs 30 0.3 90 3% Sales price ($/Kg) ANTIDANDRUFF AGENTS Dosage Rate (%) Cost of biocide per T of Shampoo ($) Percentage of raw material costs Zinc Pyrithione (48% ai) 19 1.0 190 6.3% Piroctone Olamine 100 0.5 500 16.6% (100% ai) Climbazole (100% ai) 75 0.7 525 17.5% Ketoconazole 200 1 2000 22% *Popular formulation used in Personal Care Products ** Assume costs of raw materials are $ 4,000 per tonne except for Nizoral shampoo (contains ketoconazole), which sells for 3 times the price of other antidandruff shampoos. CHAPTER 12 11 www.biocide-information.com

4 BIOCIDE CONSUMPTION 4.1 GLOBAL AND REGIONAL ANALYSIS The global market for Biocides in Personal Care products is $ 954 million. Europe is the leading region for Biocide consumption. The leading Biocides consumed in the global Personal Care products market are alcohol type with sales of $ 187 million as shown in the following table which segments the market by biocide active ingredient per geographical region:. Table 11: Biocide Sales by Type within Personal Care BIOCIDE AMERICAS ASIA PACIFIC EUROPE GLOBAL ($M) ($M) ($M) ($M) Alcohol 50.0 67.0 70.0 187.0 Amines 4.0 2.0 6.0 Bronopol 6.0 6.0 10.0 22.0 Chlorhexidine 4.0 2.0 4.0 10.0 Chlorphenesin 3.0 4.0 3.0 10.0 Climbazole 4.0 7.0 8.0 19.0 CMIT/MIT 18.0 10.0 10.0 38.0 Formaldehyde Releasers (including dmdm hydantoin, quaternium 31.0 32.0 18.0 81.0 15) IPBC 6.0 5.0 5.0 16.0 Ketoconazole 9.0 9.0 9.0 27.0 MIT 9.0 5.0 10.0 24.0 Organic Acids 27.0 72.0 74.0 173.0 Parabens 23.0 22.0 20.0 65.0 Phenolics 2.0 2.0 4.0 PHMB 3.0 2.0 2.0 7.0 Polyaminopropyl biguanide 3.0 2.0 3.0 8.0 Piroctone Olamine 4.0 4.0 7.0 15.0 Quats 24.0 9.0 18.0 51.0 Selenium Sulfide 10.0 6.0 3.0 19.0 Silver 0.8 1.0 1.8 Triclosan 12.0 6.0 5.0 23.0 Zinc pyrithione 40.0 40.0 33.0 113 Other 13.2 15.0 6.0 34.2 TOTAL 306.0 328 320.0 954.0 Alcohols are widely used in the personal care industry with sales of $ 187 million. Alcohols are used as preservatives and bacteriostats. Alcohols can be divided into lower molecular CHAPTER 12 12 www.biocide-information.com

type alcohols which are used for disinfecting hands and surfaces whereas the higher molecular type alcohols tend to be used as preservatives. Phenoxyethanol is the leading alcohol used accounting for nearly 70% of consumption. Phenoxyethanol is followed by benzyl alcohol at 20 % and the remainder includes phenethyl alcohol, phenylpropanol etc. Bronopol has sales of $ 22 million. Bronopol is extremely effective in combination with numerous other biocides, for example certain isothiazolones, quarternary ammonium salts and IPBC. Using these biocides together with bronopol will provide synergistic benefits which are less expensive, and reduces application rates. The leading manufacturer of Bronopol is BASF followed by DOW and numerous generic manufacturers. 5-Chloro-2-methyl-4-isothiazolinone and 2-methyl-4-isothiazolinone (CMIT/MIT) has sales of $ 38 million within the global personal care industry. The CMIT/MIT biocides are used in a ratio of 3:1 5-chloro-2-methyl-4-isothiazolin-3-one and 2-methyl-4-isothiazolin-3-one (CMIT/MIT). They are supplied as a 1.5% aqueous solution. The leading manufacturer is DOW. CMIT/MIT has broad activity against both Gram-positive and Gram-negative bacteria and it is also very effective against yeast. It is effective over a broad ph range from 1-8. CMIT/MIT can be used alone or in combination where it offers the following benefits: (1) Broad spectrum antibacterial activity (2) Low cost effect in low ph systems (3) Broad regulatory approvals (4) Low VOC / solvent free (5) Pale colour (6) Speed of kill. The major disadvantages to CMIT/MIT are: (1) Chlorinated (2) Unstable at high ph (3) Inactivated by amines (4) Poor temperature stability (5) Deactivated by reducing agents (6) Requirement for stabilisers such as formaldehyde or metal ions (7) Skin sensitiser (8) Volatile 1,1-Hexamethylene-bis 5-p-chlorophenyl biguanide gluconate (Chlorhexidine) is used within preservation of personal care products and Oralcare with sales of $ 10 million. It is popular as it has excellent persistence, good activity against all microorganisms, low toxicity and irritancy. The main disadvantages are poor biodegradability and discolouration to teeth. The leading suppliers of Chlorhexidine are Evonik, Medichem, Mölnlycke Health Care, RN Pharmaceuticals, Schutz and Xttrium. Chlorhexidine is used within the Corsodyl Mouthwash range from GSK which contains 0.2% Chlorhexidine Gluconate and 5.7 % Ethanol. Climbazole is a popular antidandruff agent used in personal care products with sales of $ 19 million at active manufacture level. Climbazole is sold as a 100% active powder and the product is used in antidandruff shampoos at use levels ranging from 1% and 2% by weight. Due to regulatory restrictions, Climbazole is only registered to be used in Asia and Europe. Bayer is the leading manufacturer of climbazole and the product is licensed to Symrise for the personal care industry. Symrise has many patents on the use of climbazole in antidandruff shampoos. CHAPTER 12 13 www.biocide-information.com

Formaldehyde Releasers provide a broad spectrum of antibacterial and antifungal activity with a relatively rapid speed of kill. They have combined sales of $ 81 million to the personal care industry. The most popular formaldehyde releaser used in the personal care industry is DMDH Hydantoin. It is effective against gram positive and gram negative bacteria. It is used in combinations with CMIT/MIT, parabens, quats or iodopropynyl butyl carbamate to provide a broader spectrum of activity in stay-on and rinse-off products. It has good water solubility which makes it a popular choice for clear products. The leading manufacturer of DMDM Hydantoin is Lonza who also provide it in a number of formulations with other actives i.e. IPBC. The second most popular group of formaldehyde releaser biocides are Diazolidinyl urea / Imidazolidinyl urea. They are highly effective against gram-positive and gramnegative bacteria. Diazolidinyl urea / Imidazolidinyl urea are often used in combination with parabens. Leading end uses include leave on products such as colour cosmetics, facial treatments, hand and body products and sun care preparations. Ashland is the leading manufacturer of Diazolidinyl urea / Imidazolidinyl urea followed by generic producers. Another popular formaldehyde releaser is sodium hydroxymethylglycinate. Another formaldehyde releasers used in the Personal Care industry is Quaternium 15 which is the designated name for 1-(3-chloroallyl)-3,5,7-triaza-1-azoniaadamantane chloride and is a formaldehyde donor. Quaternium 15 is active against gram-positive and gram-negative bacteria, as well as yeasts and moulds. It is effective against such gram-negative bacteria as pseudomonas aeruginosa and pseudomonas cepacia. Quaternium 15 is mainly used in creams, eye makeup and shampoos. The main manufacturers of formaldehyde releasers are Ashland, Clariant, DOW, Lanxess, Lonza, Schulke & Mayr, Thor and Troy. 3-Iodo-2-propynylbutyl carbamate (IPBC) has sales of $ 16 million and is used within the personal care industry where antifungal activity is required. IPBC can be supplied in a VOC free formulation and is very effective against mould fungi. The leading supplier of IPBC blends to the Personal Care industry are Lonza and Ashland. Ketoconazole is the second most popular antidandruff agent used in personal care products with sales of $ 27 million at active manufacture level. Ketoconazole is sold as a 100% active powder and the product is used in antidandruff shampoos at use levels ranging from 1% and 2% by weight. Johnson & Johnson is the leading consumer of the product which is used in the Nizoral line of antidandruff shampoos. Janssen is the leading manufacturer of ketoconazole for the personal care industry. CHAPTER 12 14 www.biocide-information.com

2-methyl-4-isothiazolinone (MIT) is used as a preservative within the personal care industry with sales of $ 24 million. The biocide was developed and patented by DOW (tradename is Neolone). MIT has a lot of the benefits of CMIT/MIT without the chlorine. The product is used as a preservative where it can be used alone or in combination with other biocides. MIT has global regulatory approval for the personal care industry, a key criteria in the selection process for biocides at some multinationals. For the future, MIT will decrease in sales as regulatory authorities restricts its use to ineffective levels. Organic Acids are widely used as preservatives in the Personal Care industry with sales of $ 173 Million. Organic acids are helpful against microbes as low ph suppresses microbial growth and spore germination is delayed. The leading organic acids used in the personal care industry are benzoic acid, sorbic acid and dehydroacetic acid. Less popular organic acids used in the Personal Care industry are Acetic Acid, Formic Acid, Lactic acid, Propionic Acid and Salicylic Acid. Some organic acids do not make any preservative claims and so do not have to be registered as a biocide. This makes them attractive to biocide formulation and personal care manufacturers. There is a trend towards organic acids due to the perceived notion that they are safer than synthetic chemicals. The main disadvantage of organic acids are the high dosages required to achieve an effect as illustrated in the table below: Table 12: Minimum Inhibitory Concentration for Natural versus CMIT/MIT BIOCIDE MIC Value (ppm) Aspergills Niger MIC Value (ppm) Pseudomonas Aeruginosa Benzoic Acid 1000 160 CMIT/MIT 4 4 Dehydroacetic acid 200 20,000 Parabens were the number one biocide used in personal care products but their sales are declining and now estimated at $ 65 million. Parabens are esters of parahydroxybenzoic acid where the ester can be methyl, ethyl, propyl, butyl etc. They are more effective than organic acids at higher ph levels. Parabens are used most often for their activity against yeast and mould. Methyl paraben is more water soluble than propyl paraben and is considered more effective in certain formulations. These formulations are often incorporated in a ratio of 2:1 of methyl to propyl parabens. The leading manufacturer of Parabens is Clariant followed by many generic producers such as Napp, Protameen, Salicylates & Chemicals and Ueno. Sales of parabens will continue to decline in the future as they are being restricted by governments and industry associations. For example, the Danish authorities introduced a ban on the use of propyl- and butyl-paraben in products for children under the age of three. In addition, the CHAPTER 12 15 www.biocide-information.com

Scientific Community on Consumer Safety (SCCS) has proposed a complete ban on isobutyl-paraben and to restrict the amount of propyl- and butylparaben to 0.19% in cosmetic formulations. Piroctone Olamine is a popular antidandruff agent especially in Europe with sales of $ 15 million at active manufacture level. Piroctone olamine is sold as a 100% active powder and the product is used in antidandruff shampoos at use levels of 1% by weight. Clariant is the leading manufacturer of piroctone olamine. Clariant is followed by generics such as Ecochem based in China. Polyhexanide (polyhexamethylene biguanide, PHMB) is a polymer used as a preservative in make-up removers, cleansing tissues with sales of $ 7 Million. It was classified under the CLP Regulation as carcinogenic since January 2015. L Oreal is the single biggest purchaser of PHMB where it widely used in their makeup removers via their brands Garnier, Vichy and La Roche-Posay. Since the ban, Beiersdorf has removed PHMB from all their make-up removers and replaced with Benzethonium chloride. The leading supplier of PHMB is Lonza followed by Pareva and Chinese producers. Polyaminopropyl biguanide (PAPB) is used within deodorant body sprays and cleaning solutions for contact lens with sales of $ 8 million. It is popular as it has excellent persistence, good activity against all microorganisms, low toxicity and irritancy. The leading suppliers of PAPB are Lonza (Cosmocil CQ) and Quingdao Kingnod Chem in China. Quaternary ammonium compounds (or quats) are used as bacteriostats and preservatives in the personal care industry with sales of $ 51 million. A large number of quats are offered to personal care manufacturers and formulators, differing by type and alkyl group length chain. The most popular quats in the personal care industry is cetylpyridinum chloride which is used in mouthwashes and feminine deodorants. The leading suppliers of cetylpyridinum chloride are Vertellus and Jubilant. Benzethonium chloride is widely used in underarm and foot deodorants. It is used at levels of up to 5% in products that stay on the skin. Alkyl dimethyl ammonium chloride (ADBAC) is used within personal care products exhibiting disinfectant purposes. Other popular quats are dialkyl dimethyl ammonium and benzyl/ethyl ammonium chloride. Lonza is the leading manufacturer of Quats to the personal care industry, followed by Akzo, Jubilant, Mason, Stepan and Vertellus. Selenium Sulfide is used as an antidandruff agent in personal care products with sales of $ 19 million at active manufacture level. Selenium sulfide is also known as selenium disulfide, is CHAPTER 12 16 www.biocide-information.com

a bright orange powder prepared from selenious acid and hydrogen disulfide. Selenium sulfur is incorporated into a formulation in a precipitated or colloidal form and is used as a relatively inexpensive antidandruff agent. Chattem (100 % owned by Sanofi-Aventis) is the leading producer and consumer of the product, which is used in the Selsun Blue line of antidandruff shampoos. Silver consumption in Personal care is estimated at $ 1.8 million at manufacture level. Silver is widely used in Japan. Silver is normally supplied as a 1% - 3% a.i. formulation and added by a number of methods to give 0.1% in the final product. Silver is supplied with carriers such as glass, zeolite, zirconium phosphate, titanium dioxide, ceramics and silica gel. The silver ion is gradually released from the carriers and becomes an active biocide. The costs of silver formulations are $150 per kg. Ishizuka, Kanebo, Sinanen and Toagosei are the leading manufacturers of silver. Triclosan (2,4,4 -Trichloro-2-hydroxy-diphenylether) is used as a bacteriostat in body washing cleaners, deodorants, toothpaste and mouth rinses with sales of $ 23 million. Triclosan is suitable for such applications as it is odour free, kind to the skin and very effective against gram positive bacteria. The product is relatively insoluble and is normally incorporated into personal care products by predissolving it in a surfactant concentrate. Triclosan allows personal care manufacturers to make antimicrobial claims. The leading manufacturer of triclosan is BASF followed by Generic producers. Triclosan is supplied as 96% active substance in powder form and in formulations with varying active substance concentration. The leading enduser is Colgate who use triclosan within their oralcare range of products. Triclosan (100% ai) is used at 0.2% of the final product. Zinc pyrithione is the leading biocide used in personal care products with sales of $ 113 million at active manufacture level. Zinc pyrithione is sold as a 48% active dispersion and as a 100% active powder. The product is used in various antidandruff shampoos at use levels ranging from 1% - 2% by weight. Procter & Gamble is the leading consumer of the product which is used in the Head and Shoulder line of antidandruff shampoos. Lonza is the leading manufacturer of zinc pyrithione followed by API and Janssen for the personal care industry. OTHER has sales of $ 34 million and includes a broad range of products including allantoin, dipyrithione, dibromo dicyanobutate (CTFA adopted name ismethyldibromo glutaronitrile), sodium pyrithione, natural biocides which are on annex of cosmetic regulations. Methyldibromo glutaronitrile is extremely effective in combination with numerous other CHAPTER 12 17 www.biocide-information.com

biocides such as phenoxyethanol, isothiazolones and IPBC. For the future, sales of methyldibromo glutaronitrile will decline due to sensitisation. The leading supplier of methyldibromo glutaronitrile is Lubrizol. 2-Dibromo-2,4-dicyanobutane is used primarily for its activity as a preservative. The primary source of exposure is Euxyl K-400 in which it is combined with phenoxyethanol in a 1:4 ration. Euxyl K400 is effective at low concentration against both bacteria and fungi for the preservation of cosmetic and personal care products. The most popular formulation is methyldibromoglutaronitrile (MDGN) + phenoxyethanol, and it is sold under the trade name Euxyl K-400. It was once a very popular cosmetic preservative in Germany. The manufacturer (Schulke & Mayr, Hamburg, Germany) recommends a use concentration between 0.05% and 0.02% depending on the product to be preserved. 1,2- Dibromo-2,4-dicyanobutane is also been available as a biocide in latex paints, plastic dispersion paints, adhesives and metalworking fluids under the trade name Tektamer 38. Within the EU Dibromodicyanobutane is only allowed in rinse-off cosmetics, e.g. in showergels, bath -gels, washing emulsions, shampoos. Many of the other materials are used in natural preservatives which are growing in usage within the Personal Care industry. A recent example was Vedeqsa, a subsidiary of Spanish company Lamirsa, who introduced AMINAT and AMINAT-PQ to the Personal Care industry. The active ingredient is LAE or Lauric arginate. CAS number: 60372-77 - 2 INCI name: Ethyl lauroyl arginate HCl. The composition: 20% LAE in propylene glycol. AMINAT-PQ will be sold as an Antimicrobial agent for oral care products, especially mouth wash solutions and toothpastes. It will be sold as an Antimicrobial for antiseptic hand wash products and deodorants. The Saltigo active ingredient Saltidin -in chemical terms 1-(1-methylpropoxycarbonyl)-2-(-2- hydroxyethyl)piperidine or simply icaridin -is not an insecticide. It simply repels insects by acting on their odorant receptors, disabling their ability to recognize humans as blood donors. Consumer organizations give top marks to insect repellents containing the active ingredient Saltidin, and it is recommended by the World Health Organization (WHO) as the substance of choice for malaria prophylaxis. "Unlike other repellents, Saltidin does not attack coatings or plastics and is virtually odorless. Furthermore, it does not have a sticky feel on the skin," says Dr. Christoph Peters, Saltidin Business Manager at Saltigo. 4.2 MULTI-FUNCTIONAL INGREDIENTS There is a trend towards combining biocides with multi-functional ingredients (do not appear on annex of cosmetic regulations as preserving is not their main function). Such products are growing due to the perceived notion that they are more natural than synthetic biocides. Multifunctional ingredients include a broad range of material such as glycol, herbs, plant extracts, mineral raw materials and vitamins. We estimate the following multi-functional ingredients to CHAPTER 12 18 www.biocide-information.com

be the most popular: Caprylyl glycol (increases activity of certain preservatives), Ethylhexyl glycerin (decrease surface tension of cell membranes thereby increase contact surface for preservatives), Caprylic acid (increase activity of certain preservatives), Glyceryl caprate (as above), Ethylenediaminetetraacetic acid (EDTA Chelator) (increase permeability of cell membranes, making them more sensitive to preservatives. Currently it is estimated that 20 % of all personal care products are not using preservatives due to product packaging and/or composition making preservatives unnecessary. The personal care companies use certification organisations, such as Ecocert (based in France), BDIH*{BundesverbanddeutscherIndustrie-und Handelsunternehmen}, NaTrue in Germany, The Soil Association in the UK, National Organic Program in USA to certify their products. Ecocert is Europe s best known certification body for organic products working in more than 80 countries worldwide. The demand for its certification is growing, but is a relatively recent trend. Valerie Lemaire for Ecocert comments: Ecocert is working on European harmonization with other European certification bodies from Italy, Germany and England to set up common European standards. It is normal to combine multi-functional ingredients with conventional and mild preservatives. The following are popular preservative formulations with multifunctional ingredients: Activon is Korean and developing sustainable active ingredients like propanediol via Biotechnology. The company supplies personal care companies in Asia with Activonol-PAF E91 (Phenoxyethanol & Ethylhexylglycertin) Activonol-3 is propanediol and 100 % natural glycol derived from biofermentation process. It is used as solvent, humectant, emollient and preservative booster Activonol -5 has pentylene glycol which is a moisturizer and solvent and good antimicrobial effect and excellent synergistic antimicrobial effect with glycols and preservatives Activonol-6 is 1,2-Hexanediol which can be used solely as an antimicrobial. Active Microtechnologies focuses on preservation alternatives in the Personal Care and Cosmetics Industry. They supply Synercide Herbal Fusion which contains Synercide Herbal Fusion which consists of oregano, thyme and rosemary extracted in caprylyl and hexylene glycols. In this system, the glycols act as more than just a solvent as they are understood to provide emollient and humectant properties. INCI Name:Hexylene Glycol (and) Caprylyl Glycol (and) Origanum Vulgare Leaf Extract (and) Thymus Vulgaris (Thyme) Leaf Extract (and) Rosmarinus Officinalis (Rosemary) Leaf Extract (andacterial and antifungal ingredients derived from citrus fruit. The Israel-based company has created an extraction method to harness the preservative power of citrus peel. CHAPTER 12 19 www.biocide-information.com

Ashland supplies Conarom H-3 which is a blend of PPG-2 Methylether, Piperonal and phenylethanol. It is effective on its own against gram-positive and gram negative bacteria, mould and yeast. The aldehydic and one of the glycolic components are found in a variety plants and are extracted from their essential oils. The vanilla-like aroma of Conarom H-3 means that it should only be added to scented formulations. Conarom H-3 should be used at concentrations in the range 0.3% to 2.0% and in the ph range 4-8. Conarom P is a blend of Phenylethanol (Fragrance), Capryl Glycol and Trideceth-8. It is a nature-identical fragrance additive in glycolic solution. The aroma component is found in a variety of plants and is extracted from their essential oils. The mild rose-like aroma of Conarom P complements the aroma of the final product. The ingredients can be labelled either according to INCI or as perfume or aroma. Conarom P is recommended mainly for use in creams, lotions and shampoos, with optimal activity at ph5. Strong oxidants and strong alkalis lead to decomposition of the active ingredients. Optiphen was developed as an alternative for personal care formulations requiring a paraben and formaldehyde-free preservative system. Optiphen consists of Phenoxyethanol in an emollient base of Caprylyl Glycol. The combination of these ingredients provides optimized protection against microbial growth while imparting exceptional feel to the finished product. Optiphen can be used at 0.5% 1.5%. Optiphen HD is 1,2,-hexanediol which is a preservative booster. Optiphen Plus is a patent pending globally approved preservative developed particularly for low ph systems. This liquid preservative system features an innovative blend of phenoxyethanol, sorbic acid and caprylyl glycol. Optiphen was originally obtained from the berries of the mountain ash tree, sorbic acid has been produced commercially since 1954. It is used extensively in the preservation of food, cosmetic, and pharmaceutical applications. The combination of sorbic acid and phenoxyethanol provides broad-spectrum preservation against Gram-positive and Gram-negative bacteria, yeast, and mold. The presence of caprylyl glycol in the blend imparts outstanding emolliency in addition to moisturization. With this blend of ingredients, Optiphen Plus is effective in improving the skin feel of creams, lotions, foundations, concealers, and moisturizers along with providing broad-spectrum preservation. Optiphen ND is a mild globally approved preservative consisting of a liquid blend of phenoxyethanol, benzoic acid, and dehydroacetic acid. Benzoic acid is a simple aromatic carboxylic acid widely distributed in nature in the free state or in the form of salts. Appreciable amounts are found in berries, such as cranberries. The free acid is found in natural products such as prunes, ripe cloves and oil of anise seeds. In addition to being used for cosmetic preservation, it is also employed as a preservative in food, CHAPTER 12 20 www.biocide-information.com

juices, fats, and oil, for pharmaceutical and medicinal uses, and an ingredient in antiseptic ointments for the treatment of fungal infections of the skin. Dehydroacetic acid, a cyclic ketone acid, has antifungal and antibacterial properties. Due to the presence of these organic acids in the system, Optiphen ND offers broad spectrum protection against bacteria, yeast, and mold and is most effective in applications such as creams and lotions where the ph is not higher than 6.0. It is also very effectively used in the preservation of wipes, which is a growing market segment. Optiphen and Optiphen Plus have wide applicability in skin care, sun care, body care, hair care and colour cosmetics applications at use levels of 0.75% to 1.5%. Rokonsal BSB contains Benzyl Alcohol (and) Propylene Glycol (and) Benzoic Acid (and) Sorbic Acid. Rokonsal BSB may be classified as a "mild preservative", provided the ph of the final product is not higher than 5. It is effective against gram-positive and gram-negative bacteria, yeasts and moulds at acid ph values. It is used in a broad range of rinse-off cosmetics and skin care products. BASF active ingredients division Laboratories Serobiologiques has launched Sanicapyl with the aim of helping manufacturers develop hair care products for sensitive scalps by ensuring hair remains in good condition while preventing uncomfortable and itchy scalp as well as excessive oil. The research worked around the principle that excessive sebum production leads to oily hair and scalp conditions, which in turn leads to bacterial proliferation or hyperkeratosis, precursors to dandruff. Sanicapyl is based on a selection of natural extracts, including fruit, as well as a piper negrum pepper and inga alba bark, together with sodium lauroyl lactylate and butylene glycol. The clinical trial results showed that that this formulation was just as effective at reducing the appearance of dandruff as a shampoo containing one per cent of a benchmark ingredient. Beijing Sunpu Biochem Specialises in Personal Ingredients in China with all their preservatives being conventional type or mild type but they plan to introduce multi-functional ingredients to cater for the growing preservative free personal care market in China. Bio-Botanica supplies Neopein a 100% natural preservative used at rates as low as 0.2%. Recently the company replaced the cinnamon component by Olive Leaf extract to produce a product that has less potential to irritate and a lighter scent. Ingredients: extracts of Origanum vulgare (oregano), Thymus vulgarism (thyme) Rosmarinus officinalis (rosemary), Lavandula officinalis (lavender), Hydrastis Canadensis (goldenseal), and Olea europaea (olive leaf). Suprapein is a synergistic combination of botanical extracts that yields a natural preservative with a broad-spectrum of antimicrobial activity. Suprapein is made with the CHAPTER 12 21 www.biocide-information.com

following botanical extracts: Origanum Vulgare (Oregano) Leaf Extract (and) Thymus Vulgaris (Thyme) Extract (and) Cinnamomum Zeylanicum (Cinnamon) Bark Extract (and) Rosmarinus Officinalis (Rosemary) Leaf Extract (and) Lavandula Augustifolia (Lavender) Flower Extract (and) Citrus Medica Limonum (Lemon) Peel Extract (and) Mentha Piperita (Peppermint) Leaf Extract (and) Hydrastis Canadensis (Golden Seal) Root Extract (and) Olea Europaea (Olive) Leaf Extract. Chemipol Supplies Personal care preservatives (Biopol) in Spain & North Africa with conventional Biocides. The company has introduced the Sensicare range to take advantage of the trends to more milder Antimicrobials. The range includes: SENSICARE C 1000: phenoxyethanol formulated with an emolient (caprylyl glycol) which enhances and extends the antimicrobial activity. SENSICARE C 1010: phenoxyethanol, methylisothiazolinone and an emolient which enhances and extends the antimicrobial activity. SENSICARE C 1040: benzoic acid, dehydroacetic acid, phenoxyethanol and an emolient which enhances and extends the antimicrobial activity. SENSICARE C 1045 : benzoic acid, dehydroacetic acid and phenoxyethanol. SENSICARE C 1050 : phenoxyethanol, benzoic acid, acid dehydrocetic, polyaminopropyl biguanide and emolient that enhances antimicrobial activity. SENSICARE C 1055: phenoxyethanol, benzoic acid and sorbic acid. SENSICARE C 2010: sodium benzoate and potassium sorbate. SENSICARE C 2200: sodium Benzoate in powder form. SENSICARE C 2210: sodium benzoate and potassium sorbate in powder form. SENSICARE C 3000 : dehydroacetic acid and benzyl alcohol Clariant offers Velsan SC which is a synergistic aid that boosts the performance of standard preservatives, like aromatic alcohols and organic acids. As a result, it decreases the overall amount needed for safe preservation, thereby reducing the odour issue known from some preservatives. When used in combination with non-listed actives, manufacturers can claim preservative free for their cosmetic and personal care products. Velsan contains sorbitan caprylate. Citramed Supplies antibacterial and antifungal ingredients derived from citrus fruit. The Israel-based company has created an extraction method to harness the preservative power of citrus peel. CHAPTER 12 22 www.biocide-information.com

DowDupont is a leading supplier of conventional preservatives and also supplies Zemea propanediol, a 100 % natural preservative boosting humectant and solvent approved by Ecocert and certified by the Natural Products Association. It is derived from fermentation of glucose from corn starch and replaces petroleum based glycols or glycerin. 1 % Zemea propanediol really boosts the efficacy of zinc pyrithione. Dr Straetmans Supplies has created a plant-based fungicidal ingredient called Dermosoft 688 ECO (INCI: p-anisic Acid) that is arguably more natural than 'nature identical' preservatives. The product is Ecocert approved. Dr Straetmans said its own tests suggest that the best results are achieved when the ingredient is used with bactericidal organic acids, which are also produced by the company. Dr Straetmans is the leading producer of Caprylyl glycol which has antimicrobial properties but it is primarily used for moisturizing and stabilisation within the personal care industry. They say that it would not be used alone for preservation but would require a booster biocide such as ethylhexylglycerin. Galaxy (TRI-K) is a large manufacturer of phenoxyethanol and their main preservatives with multifunctional ingredients are Tristat E and Tristat PR which are based on Phenoxyethanol. Galaxy launched Galguard Trident in 2014 and it contains Capryloyl glycine, undecylenoyl glycine, phenoxyethanol. It is used in Wipes, baby care, sun care, skin care, hair care at dosage rates of 0.5-1.2% (on active basis). Induchem supplies Unigard OA-94 which is a preservative system for cosmetic products e.g. cleansing cosmetics, such as liquid soap, shampoos, shower gels, and for personal care products, such as lotions, creams and liquid emulsions. The best results can be obtained in products with a slightly acidic ph value up to ph 6.0. The system is based on natural or nature-identical organic substances. All components of Unigard OA-94 are approved in the EU, the USA and Japan. Unigard OA-94 consists of benzoic acid and dehydroacetic acid in phenoxyethanol. Inolex supplies is a leader in alternatives/mild preservatives with warehouses in Antwerp and HongKong. The companies uses multifunctional ingredients for Preservative free formulations. Inolex Daniel Winn say Zeastat (caprylhydroxamic acid chelating agent and propanediol) is a complete system for preservative free cosmetics. They also supply Aromastat which is based on (caprylhydroxamic acid, phenethyl alcohol and glycerin) as a complete system for preservative free cosmetics. They say the following biocide boosters are their most popular but have a broad range of multifunctional ingredients: CHAPTER 12 23 www.biocide-information.com

Lexgard Natural based on glyceryl caprylate and glyceryl undecylenate for preservative free personal care Lexgard E based on ethylhexylglycerin which is a humectant, moisturizing and wetting agent also a biocide booster Lexgard O based on Caprylyl glycol which is a humectant can be used to give Preservativefree claims. Earlier in the year, they acquired ies Labo in France which is a producer of natural ingredients that are used in cosmetics. They are certified by Ecocert (France), National Organic Program (USA), Natrue (Germany) and Cosmos (Europe). Lamirsa supplies Vedeqsa under the name of AMINAT and AMINAT-PQ to the Personal Care industry. The active ingredient is LAE or Lauric arginate. CAS number: 60372-77 - 2 INCI name: Ethyl lauroyl arginate HCl. The composition: 20% LAE in propylene glycol. The main difference between AMINAT and AMINAT-PQ is the purity of the LAE used in its formulation. AMINAT-PQ will be sold as an Antimicrobial agent for oral care products, especially mouth wash solutions and toothpastes. AMINAT will be sold as an Antimicrobial for antiseptic hand wash products and deodorants. Lanxess is a broad based biocide supplier with personal Care ingredients sold under the Purolan and Solbrol tradename. Solobrol CP can be used in a preservative free formulations. The solbrol range has the following ingredients: Solbrol CP Phenethyl Alcohol (and) Caprylyl Glycol Solbrol LB 1 is based on preservatives that are listed on the Ecocert approved list of preservatives. It is a liquid mix of Benzoic acid, Sorbic acid and Dehydroacetic acid in Benzyl alcohol. Solbrol LB 2 is based on preservatives that are listed on the Ecocert approved list of preservatives. It is a liquid blend of Dehydroacetic acid and Benzoic acid in Benzyl alcohol. Solbrol LB 3 is a Paraben free blend. It is a liquid blend of Dehydroacetic acid and Benzoic acid in Phenoxyethanol. Solbrol LB 4 is a liquid blend of Benzoic acid, Sorbic acid, Dehydroacetic acid and Caprylyl Glycol in Benzyl alcohol. Solbrol LB 5 is a clear viscous yellow liquid. It is a broad-spectrum liquid blend containing four different Parabens, along with Dehydroacetic acid (DHA), which are dissolved in Phenoxyethanol. CHAPTER 12 24 www.biocide-information.com

Lincoln Manufacturing provides Linatural MBS (microbial blocking systems) which are naturally-derived, inexpensive, preservative-free systems that block microorganisms from growing, thus keeping the formulation stable. These systems give the customer the option for a cost effective alternative to preservatives that block a broad spectrum of microorganisms from contaminating the formulation while the customer can claim preservative-free and no oils. Linatural NLP-T is based on turmeric and clove bud oil, and Linatural NLP-B is based on basil and clove bud oils. Lincoln has also expanded its global line of Lincoserve globallyapproved alternative preservatives to include more blends from their domestic manufacturing, such as Lincoserve CG-2, 4 and 5 blends based on caprylyl glycol and phenoxyethanol. Lonza supplies Geogard 361 which combines the activity of three different preservative routes - acids, alcohols and quaternary ammonium compounds - to provide both rapid antimicrobial activity and long term preservation. The Geogard series also includes blends such as Geogard 221, which features dehydroacetic acid as the primary active ingredient, augmented by an alcohol. Additional blends contain various ratios of dehydroacetic acid, quaternary ammonium compounds as well as organic acids and alcohols. Salicylates and Chemicals Paraben Free, Isothiazolinone Free preservative systems are: 1.Saliguard TM : This is a preservative based on a blend of an organic acid (Octanohydroxmic Acid) along with Caprylyl Glycol and Butylene Glycol. It can be used for several applications mainly because of the distinctive combination of a high Ph with an organic acid. 2.Saliguard HDZ: This broad spectrum, multifunctional preservative is based on a blend of 1, 2 Hexandiol along with 1, 2 Propanediol and Iodopropynyl Butyl Carbamate. 3.Saliguard HDC: Mainly for the Korean market, this preservative is a blend of 1,2 Hexandiol, Chlorophenesin and Phenoxyethanol. This broad-spectrum additive is effective against all types of Schulke and Mayr supplies Sensiva which inhibits odour-causing bacteria on the skin. It acts as a mild humectant and skin emollient with an excellent feel. The product exhibits good deodorizing and skin care properties of ethylhexylglycerin, combined with the moisturizing action of caprylyl glycol. At 1% use level, mixed with 0.2% methylparaben, Sensiva SC has been demonstrated to boost biocidal efficacy against certain types of bacteria, including Escherichia Coli. Another formulation is sensiva PA 20 which combines phenethyl alcohol, traditionally used as a fragrance ingredient, with ethylhexylglycerin for its preservative boosting effect. This results in a biodegradable blend that can maintain the microbiological stability of a wide range of products. A popular preservative from Schulke is based on ethylhexylglycerin which is a preservative booster derived from glycerol (also called glycerin). Glycerin is colourless, odourless, viscous liquid that is a sugar alcohol, and is sweet-tasting CHAPTER 12 25 www.biocide-information.com