Innovation Chemical Feb2013

8/11/2019 Innovation Chemical Feb2013

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DRIVING INNOVATIONHow stronger laws help bringsafer chemicals to market


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DRIVING INNOVATIONHow stronger laws help bringsafer chemicals to market

Baskut Tuncak

The Center forInternational Environmental Law

(CIEL)

F E B R U A R Y 2 0 1 3


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ii THE CENTER FOR INTERNATIONAL ENVIRONMENTAL LAW

2013 Center for International Environmental Law (CIEL)

About CIEL

Founded in 1989, the Center for International Environmental Law (CIEL) uses international

law and institutions to protect the environment, promote human health, and ensure a

just and sustainable society. CIELs staff of international attorneys work in the areas of

toxic chemicals, human rights and the environment, climate change, law and communities,

trade and the environment, international environmental governance, biodiversity and

international financial institutions by providing legal counsel and advocacy, policyresearch and capacity building.

This work is licensed under the Creative Commons Attribution-NoDerivs-NonCommercial

1.0 Generic License. To view a copy of this license, visit http://creativecommons.org/licenses/

by-nd-nc/1.0/or send a letter to Creative Commons, 444 Castro Street, Suite 900,

Mountain View, California, 94041, USA.

Acknowledgements

This report was authored by Baskut Tuncak, Staff Attorney at the Center for International

Environmental Law (CIEL) with contributions by Daryl Ditz, David Azoulay and Carroll

Muffett. Many thanks to our interns for their research assistance, including: Sara Blackwell,

Hannah Colton, Heather Croshaw, Laura Drummond, Beverley Fagbohun, Julian Gonzales,Trisha Grant, Upasana Khatri, Alison Kole, Paulo Lopes, James Merrill, Mary Race, Rachael

Rivers, Abi Sze, and Erica Woodruff.

We are grateful for the assistance of Donna Purdue, J.D., PhD of Perdue IP Law APC

for contributing her expertise in the patent landscape study of phthalates alternatives.

CIEL also thanks members of its advisory panel on chemical policies and innovation who

contributed their expertise in relevant subjects and their perspectives to CIELs efforts:

Nadia Haiama, Greenpeace International; Sonja Haider, ChemSec; Rich Liroff, Investor

Environmental Health Network; Jody Roberts, Chemical Heritage Foundation; Josh

Sarnoff, DePaul University; John Schwab, National Institute of General Medical Sciences

(retired); Howard Williams, Construction Specialties; and Michael Wilson, University

of California, Berkeley. We would also like to thank Lindsay Dahl, Richard Denison,

Genon Jensen, Ninja Reineke, and Mark Rossi for their insights.

CIEL gratefully acknowledges the support of the European Environmental Health Initiative,

John Merck Fund, the Johnson Family Foundation, and New York Community Trust.


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DRIVING INNOVATION iii

Contents

iv Acronyms

1 Executive Summary

3 Chapter 1

Introduction

6 Chapter 2

Stricter chemical laws sparks the invention of alternatives

Stricter laws drive the invention of alternatives to phthalates

Stricter laws drive the invention of CFC Alternatives

13 Chapter 3

Stricter chemical laws can pull safer inventions

into the marketbut not all alternatives are safer

Regrettable substitution

Firemaster 550 and other hazardous flame retardants

Questionable substitution

DINCH as an alternative to hazardous phthalates

More promising examples of substitution

18 Chapter 4 Stricter chemical laws can enable safer alternatives

to penetrate barriers to entry

Stricter laws enable safer alternatives to overcome economies

of scale

Stricter laws reduce externalized costs, enabling the entry

of safer alternatives

Stricter laws generate information is necessary to drive innovation

22 Chapter 5

Stricter chemical laws can direct resources towards innovation

and the development of safer alternatives

26 Chapter 6

Conclusions and recommendations for policy makers

28 Endnotes


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iv THE CENTER FOR INTERNATIONAL ENVIRONMENTAL LAW

Acronyms

ACC American Chemistry Council

BBP Benzylbutylphthalate, also called n-butyl

benzyl phthalate or benzyl butyl phthalate

CBI Confidential Business Information

CFC Chlorofluorocarbon

CIEL Center for International Environmental Law

CMR Carcinogenic, mutagenic or toxicto reproduction

CPSC Consumer Product Safety Commission

DBP Dibutyl phthalate

DEHP Bis(2-ethylhexyl) phthalate

DIBP Diisobutyl phthalate

DINP Diisononyl phthalate

DINCH 1,2-cyclohexane dicarboxylic acid

diisononylester

DPHP Bis(2-propylheptyl) phthalate

ECHA European Chemicals Agency

EDC Endocrine disrupting chemical

EDDS Ethylenediamine-N,N-disuccinic acid

EDTA Ethylenediaminetetraacetic acid

EU European Union

HaSDR Health and Safety Data Reporting

HCFC Hydrochlorofluorocarbon

HFC Hydrofluorocarbon

NOAEL No observed adverse effect level

NPE Nonylphenol ethoxylate

PBB Polybrominated biphenyl

PBDE Polybrominated diphenyl ether

PBT Persistent, bioaccumulative and toxic

PCB Polychlorinated biphenyl

PVC Polyvinyl chloride

R&D Research and development

SCENIHR Scientific Committee on Emerging and

Newly Identified Health Risks

SMEs Small- and medium-sized enterprises

SVHC Substance of Very High Concern

SDS Safety Data Sheet

TBPH Bis(2-ethylhexyl)-2,3,4,5-tetrabromophthalate

TBB 2-ethylhexyl-2,3,4,5-tetrabromobenzoate

TPP Triphenyl phosphate

TSCA Toxic Substances Control Act

UNEP United Nations Environment Program

U.S. United States

vPvB Very Persistent and Very Bioaccumulative

WHO World Health Organization


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DRIVING INNOVATION 1

Executive Summary

Are innovation and the law atodds? A closer look shows thatstronger laws*for the manage-ment of hazardous chemicals

help to drive innovation in chemical andproduct sectors. Innovation is especially rele-vant today as the US$ 4.1 trillion (3.1 tril-lion euro) global chemical industry facesincreasing pressure from consumers, retail-

ers, and investors demanding safer products.At the same time, emerging economies areincreasingly well-positioned to becomeleaders in chemical innovation, potentiallyleaving Western Europe and the UnitedStates behind. Together, all of these forcesare instigating changes in how governments,chemical manufacturers, and downstreamusers of chemicals are working to ensurechemical safety and drive innovation.

The Center for International Environ-mental Law (CIEL) examined the impactof laws governing hazardous chemicals in

terms of their effect on innovation.

wildlife from phthalates. As the stringencyof measures increased, so too did the num-ber of inventions disclosed in patent fil-ings by the chemical industry. Similarly,the phase-out of ozone depleting substancesalso illustrates how progressively stricter

rules at the global level can drive a sus-tained effort to invent safer alternatives.

As innovation hinges on the adoptionof inventions, stricter laws for hazardouschemicals can also help to pull inventionsinto the market, turning an invention intoinnovation, as our case studies highlight.Barriers exist that prevent the entry ofsafer alternatives. Overcoming the inertia

0

5

10

15

20

25

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

Non-phthalate inventions

Inventions that can use

phthalates or non-phthalates

1998: European

Commission

SCTEE opinion and

Recommendation

1999: Temporary EU

phthalate directive

2006:

EU REACH

Reg.

Adopted

2008: 4 phthalates

added to REACH

Candidate List

numberofpatentedinventions(as

patentfamilies)

* We define laws to include legislation, regulation, directives, decisions, rules, and other forms of enforceable standards

at the sub-national, national, regional and global levels.

of entrenched toxic chemicals typicallyrequires the power of the government.Our findings show that stricter laws en-able safer chemicals to overcome barriersto entry, such as economies of scale en-

joyed by the current mix of chemicals, the

externalization of costs, and the lack of in-formation about chemicals and productson the market today.

However, history is replete with exam-ples of regrettable substitution, where ahazardous chemical is restricted, but thenreplaced with a different hazardous chemi-cal. The experience of transitioning fromone hazardous flame-retardant chemical to

Exponential growth in the number of patented inventions for phthalate alternatives beginning

in 1999, coinciding with the adoption of stricter rules (as captured by the number of patent

families for non-phthalate and phthalate free inventions)

FIGURE ES 1

Spike in Patented Inventions Free of Hazardous Phthalates

Our study finds that stricter

rules over hazardous chemicals

can not only drive innovation,

but also create a safer

marketplace.

The prospect of stricter laws with re-gard to toxic chemicals sparked the inven-tion, development, and adoption of al-ternatives. For example, in response to

stricter laws to protect people and the en-vironment from phthalates, a class ofchemicals with hormone (endocrine) dis-rupting properties, our study of interna-tional patent filings shows acceleration inthe invention of alternative chemicals andproducts. Spikes in the patenting of phthal-ate-alternatives clearly correlate with thetiming of new laws to protect people and


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2 THE CENTER FOR INTERNATIONAL ENVIRONMENTAL LAW

another illustrates not only the dangerouspresumption of safety about chemicals onthe market for decades, but also the weak-ness of programs to evaluate recentlydeveloped chemicals for their hazardousproperties.

We also found examples of alternativechemicals with a high-degree of structuralsimilarity to the hazardous chemicals theyreplaced, with inadequate information aboutthe alternatives potentially hazardous prop-erties. For example, alternatives to hazard-ous chemicals entered the market with astartling lack of publicly-available infor-mation about their hazards. Some of thesealternative chemicals are structurally simi-lar to previously restricted chemicals aroundthe world. However, under existing laws,additional information took many years to

be requested, let alone generated.In order to increase the likelihood that

safer alternatives will be pulled into themarket, chemical laws need to clearlyidentify hazardous properties that are notacceptable in society, generate informationabout these properties in all chemicals,and require their substitution with saferalternatives in a systematic way. Stricterlaws can enable a transition to safer alter-natives.

In short, progressively stricter laws spurthe innovation of safer alternatives and

can pull safer alternatives into the market,enabling them to overcome barriers toentry. But, policies must be in place toensure that alternatives do not also haveintrinsic hazards, to better ensure that in-novation creates a safer marketplace. Tothis end, CIEL provides the followingrecommendations for policy makers inEurope, the United States, and othercountries and regions around the world:

1. Ensure the burden of proving

chemical safety falls on chemical

manufacturers

Requiring that chemical manufacturersgenerate information about the intrinsichazards of both existing as well as newchemicals levels the playing field for saferchemicals and enables a more meaningfulassessment of alternatives. This informa-tion enables regulators to remove entrenchedchemicals of concern, downstream users todeselect hazardous chemicals from theirsupply chain, and chemical manufacturersto innovate towards safer alternatives. Al-

though recent progress has been made,most notably in Europe, in placing theburden of proving chemical safety onchemical manufacturers, greater measuresare needed, particularly in countries suchas the United States that have not updatedoutdated chemical policies from the 1970sand others that do not have such policiesin place.

2. Phase-out chemicals with

certain intrinsic hazards

Government authorities must possessand exercisethe power to remove haz-ardous chemicals from the market basedon their intrinsic hazards.

3. Recognize endocrine disruption

as an intrinsic hazard that cannot

be soundly managed

Endocrine disruption is an intrinsic haz-ard of certain chemicals, linked to a myr-iad of adverse effects that have been on therise over the past several decades. As thereis no safe dose of exposure to endocrine

disrupting chemicals (EDCs), they shouldbe recognized as a distinct category ofchemicals that needs to be phased outglobally, similarly to other chemicals withintrinsic hazards.

4. Internalize the costs of

hazardous chemicals

Not only would this lead downstream us-ers to shift to alternatives with lower costs,but this would in turn incentivize chemi-

cal manufacturers to invest in the researchand development of safer alternatives.

5. Promote access to information

Inventors need access to informationabout chemical hazards and exposures todevelop safer solutions. Regulators needaccess to hazard and exposure informationto restrict the use of hazardous chemicals,enabling the entry of safer alternatives.Consumers and downstream users needaccess to information about chemicals in

products throughout the supply chain toenable them to choose safer products,thereby incentivizing innovation towardsafer alternatives. Policy makers should en-sure that health and safety information isgenerated and made available to consum-ers, businesses, and regulators, includingawareness of products containing hazard-ous chemicals. Claims of confidentialityshould be justified, periodically re-justi-fied, and never granted for health andsafety information, to enable the develop-ment of safer alternatives.

6. Craft stronger international

laws to ensure a level playing field

at the global level

Only a narrow sliver of chemicals of con-cern on the market are covered underlegally binding global treaties throughouttheir lifecycle. A broader internationalregime to cover a wider range of hazardouschemicals and chemical-related risks is re-quired to create a level playing field forbusinesses operating in a globalized world.

Number of patented inventions by Eastman Chemical (formerly Kodak Eastman), Exxon Mobil

and Dow Chemical from 19722010 for phthalate alternatives.

F IGU R E E S 2

Stricter Laws Trigger Innovation by Major Chemical Manufacturers

0

1

2

3

4

5

6

7

8

9

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

Exxon Mobil

Eastman

Dow

numberofpatented

inventions(aspatentfamilies)

2006: REACH

Adopted

1999:

Temporary

EU phthalate

directive


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No one can deny that many ofthe features of modern lifeowe much to the ingenuity ofthe chemical industry. New

chemicals, new applications for existingchemicals, and new chemical processes en-abled a host of innovations across a rangeof industries, and led to the growth of thechemical industry over the past several

decades. Since the 1970s, the output ofthe chemical industry has grown fromapproximately one trillion U.S. dollarsadjusted for inflation, to US$ 4.12 trillionin 2010, with estimates for 2020 ap-proaching US$ 6.5 trillion.1As the scale ofthe chemical industry has grown, so too hasevidence of the adverse effects of chemicalson human health and the environment.

Innovation is especially relevant todayas the establishment of the chemical in-dustry, from manufacturers to formula-tors, face increasing pressure from two

F I G UR E 1

Growth of Chemical Industry in Emerging Economies from 2000 to 2010

C H A P T E R 1

Introduction

92

574

China

420395

EU27

404455

North

America

68127

Latin

America33 47

Rest of

World

210

419

Rest

of Asia

3987

Rest of

Europe

172 153

Japan

Source: CEFIC Facts and Figures 2011

themselves to become leaders in chemicalinnovation (see Figure 1).3 Simultane-ously, the chemical industry is also facingincreasing pressure from downstream users,retailers and consumers to provide saferproducts through the development anduse of safer chemicals (see Box 1, page 4).

A common refrain by the regulated(or soon-to-be regulated) industry is that

stricter laws over hazardous chemicals willimpede innovation, reducing economicgrowth, competitiveness, and employ-ment. We define laws to include legisla-tion, regulation, directives, decisions, rules,and other forms of enforceable standardsat the sub-national, national, regional andglobal levels. Current laws in the Euro-pean Union and United States designed toprotect people and the environment fromhazardous chemicals aim to enhance in-novation.4 However, both European and

American laws have shortcomings in terms

. . . Laws and institutions

must go hand in hand with the

progress of the human mind.

As that becomes more developed,

more enlightened, as new

discoveries are made, new truths

discovered and manners and

opinions change, with the changeof circumstances, institutions

must advance also to keep pace

with the times.

Thomas Jefferson, principal author of theDeclaration of Independence and thirdPresident of the United States, July 12, 1816

fronts.2First, after overtaking traditionalleaders such as the United States and Wes-tern Europe in bulk chemical manufactur-ing, emerging economies are positioning

n 2000

n 2010

Worldwide chemical sales in 2000 and 2010 in billions of Euros.


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of their ability to prevent harm, the costsof which are borne by individuals and so-ciety-at-large, and encourage the entry ofsafer alternatives. Can stricter laws overhazardous chemicals drive innovation?Can it drive innovation while also sendingit in a safer direction?

The Center for International Environ-mental Law (CIEL) is examining the im-pact of past efforts to protect humanhealth and the environment from hazard-ous chemicals in terms of their effect on

Over-regulation . . . is seen as

an old problem and there is a lot

of truth in that. We are working

to overcome it. But we also need

to recognize that regulation can

be a big driver of innovation.This is particularly the case in

the environmental arena.

Peter Droell, Head of Innovation Unit,European Commission

As the scale of the chemical industry has grown since the

1970s, so too has evidence of the adverse effects of chemicals

on human health and the environment.

Analyses of household cleaners, plastic products (including

toys), clothing, and other everyday products show that many

such products can contain over 70 chemicals considered of

very high concern.5 Recent biomonitoring studies confirm the

migration of hundreds of hazardous chemicals from everyday

products into people, either directly, or through food, water,

air, household dust, and other sources.6Of significant concern

is the exposure of children to a potent cocktail of hazardous

chemicals during critical windows of development. These

exposures occur through their mothers womb and breast milk,

as well as from broader environmental sources mentioned

above. The effects of exposure to these chemicals at an early

age often do not manifest for many years or even decades.

There is an increasing incidence of many diseases around

the world, including many that were much less prevalent in

children in decades past. These trends include:

A 20% increase of childhood cancers such as leukemia

and brain cancer since 1975 and a 40% increase in the

incidence of breast cancer between 197398;

Asthma, which approximately doubled in prevalence

between 1980 and 1995, continues to rise;

BOX 1

Human Health Effects Linked to Hazardous Chemicals

40% more women reported difficulty conceiving and

maintaining a pregnancy from 1982 to 2002. From 1982 to

1995, the incidence of reported difficulty almost doubled

in younger women, ages 1825;

Sharp increases in male genital malformations;

Learning and developmental disabilities, including autism

and attention deficit hyperactivity disorder, affect nearly

one in six U.S. children, as of 2008;

Doubling of the rate of diabetes in the United States

and England, with increasing frequency among young

populations; and

Dramatic rise in the prevalence of obesity among both older

and younger populations, and both wealthy, industrialized

countries as well as poorer developing countries.7

There is growing consensus about the role of chemicals in

the increasing incidence of many disorders around the world.

Among many factors, there is increasing evidence that expo-

sure to endocrine disrupting chemicals (see Box 3) at an early

age is linked to many of these disorders.8Epidemiological

data suggests EDCs may be contributing factors to increasing

incidence of these diseases over the past several decades.9

innovation, and applying lessons to ongo-ing efforts to reform chemicals policy atthe national, regional, and global levels.

We studied recent measures to reduce therisk of harm from additives to plastics(phthalates), toxic flame retardant chemi-cals (PBDEs), refrigerants (CFCs), and pes-ticides (methyl bromide). Of particular in-terest were the features of policies thatstimulated innovation and the factors thatled to satisfactory or unsatisfactory out-comes. We examined patents as an indica-


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In response to consumer concerns and advocacy campaigns,

reatilers and producers of consumer products are increasingly

demanding other businesses in the value chain ensure that

their products are free of hazardous chemicals.

Global clothing brands, Nike, Addidas, H&M, Zara and

others recently announced plans to remove certain hazardous

substances from their supply chain by 2015 or 2020, depending

on the chemical. Among hazardous chemicals tested and

found in garments were phthalates, nonylphenol ethoxylates

(NPEs), and certain amines linked to cancer.

Johnson & Johnson announced plans to remove certain

chemicals of concern from most of its adult toiletries and cos-

metic products. By 2015, Johnson & Johnson will also phase

out phthalates, as well as parabens and triclosan and certain

fragrance ingredients, which arent disclosed on product labels.

However, two chemicals linked to cancer1,4 dioxane and a

formaldehyde-releasing chemicalwill continue to be used

where safe alternatives are not available.

According to Johnson & Johnsons Susan Nettesheim,

Vice President of Product Stewardship and toxicology, theres

a very lively public discussion going on about the safety of

ingredients in personal care products. . . . It was really important

that we had a voice in that. . . . We want people to have

complete peace of mind when they use our products.10

But, businesses that take the lead in developing and using

safer chemicals are calling on policy-makers to craft policies

that help to level the playing field, both at home and at the

global level. For example, during a U.S. Senate hearing on the

need for stricter laws in the United States, a major chemical

formulator, stated: We believe it is essential for the U.S.

chemical management system to keep pace with global

developments . . . and that our government be a global leader

in chemical regulatory policy.11Major chemical manufacturers

BOX 2

Consumer Demand for Safer Chemicals

also call for a level playing field globally, with common defi-

nitions and standards, which do run the risk of harmonization

to the weaker standards. But, certain chemical manufacturers,

recognizing that the European Unions REACH Regulation is

currently the best in class, claim that it would be very helpful

if we could take our [chemical registration information required

under EU regulations] and give it to Chinese authorities.12

Thus, businesses recognize that consumer demand alone

is generally insufficient and government action may be required

to enable safer alternatives to enter and compete on a level

playing field, both at home and abroad.13

tion of rates of invention, and explored thetypes of inventions that were subsequentlyadopted by downstream users and con-sumers in the market.

Below we present some of our findingsregarding the efficacy of past measures andthe potential of stricter laws to accelerate

innovation toward safer chemicals. Firstwe present findings about the rate at

adopters to gain competitive advantagethrough innovation and an opportunity tooptimize their return on new investments.The final section presents findings on howstricter laws direct resources to the in-novation of safer alternatives. This studyconcludes with recommendations for policy-

makers to help drive innovation and sendit in a safer direction.

which alternatives are invented in responseto the prospect of stricter laws. Then weexamine the types of inventions adoptedby downstream users after measures aretaken by regulators, exploring why thetransition may or may not have been tosafer alternatives. Third, we look at how

the law can help safer alternatives over-come barriers to their entry, enabling early


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The prospect of stricter rules

for certain chemicals sparked

the invention and development

of alternatives, including

improvements in the performance

of pre-existing alternatives.

Acommon argument against theprospect of stricter rules to pro-tect people and the environ-ment from hazardous chemi-

cals is that there is not a viable alternativeto the chemical. This argument might bemade for technical reasons, such as theperformance of the chemical relative toalternatives, or the lack of manufacturing

capacity for alternatives. It can also bemade for economic reasons, where analternative is argued to be prohibitively ex-pensive. Restricting or banning the chemi-cal of concern would, the argument goes,reduce the competitiveness of a product ormay even result in the unavailability of aproduct or process from the market alto-gether. The argument is essentially a threatof lost profits, jobs, and competitiveness atthe global level. These arguments, however, ignore ourability to invent better solutions and re-

design the way people interact with their

C H A P T E R 2

Stricter Chemical Laws Spark the Invention of Alternatives

environment. We analyzed chemicals ofconcern, ranging from industrial chemi-cals in consumer products to pesticides,under national, regional and global envi-ronmental laws.

Our sample size was limited to chemi-cals that have sufficient information abouttheir hazardous properties and are sub-

ject to significant scrutiny in more than

one region of the world. In each case, theprospect of stricter rules for certain chemi-cals sparked the invention and develop-ment of alternatives, including improve-ments in the performance of pre-existing

alternatives.14 Stricter laws are defined asthose the either: (a) require a significant re-duction in exposure to hazardous chemi-cals; (b) require compliance through the useof comparatively costly technology; or (c)require significant technological change.15Below we present findings for two chemi-cals or classes of chemicals of concern thatalso clearly illustrate this trend: phthalates,

a widely used endocrine disrupting chemi-cal; and chlorofluorocarbon (CFC) refrig-erants, ozone depleting substances.

Stricter laws drive the invention

of alternatives to phthalates

Phthalates are a class of chemicals usedas plasticizers to soften certain plastics.Ninety percent of phthalate production,estimated to be in the millions of tons peryear, is used to plasticize polyvinyl chlo-ride (PVC).16As a plasticizer, phthalatesare not bound to the plastic polymer, re-

sulting in exposure for people and wildlifeas they leach out of products, contaminat-ing homes and the environment. Phthal-ates are also used as solvents in many cos-metics that are applied directly to the skin,including perfumes, lotions, soaps, sham-poos, deodorants, and hair care products. Certain phthalates are widely recog-nized as EDCs. Some disturbing genitaldeformations associated with phthalate ex-posure in animals have earned the title ofphthalate syndrome.17 Other potentialadverse effects include cancer, obesity, dia-

betes, and attention-deficit hyperactivitydisorder.18 Like other EDCs, these effectsare believed to correlate with exposureduring critical windows of development(see Boxes 1 and 3). Recent studies havedetected phthalate metabolites in a highpercentage of people tested. In some cas-es, phthalate metabolites were found in allof the urine samples analyzed.19

Beginning in 1998, following Europe-an leadership, countries around the worldtook measures to protect human health fromcertain hazardous phthalates. In addition


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The endocrine system is the system

of glands, each of which secretes

different types of hormones directly

into the bloodstream to regulate the

body. Hormones regulate various

biological functions, including human

development, metabolism, cognition,

the immune system, mood, sexual

reproduction, and programmed cell-

death to avoid cancerous growth.

Small changes in hormone concen-

trations lead to complex, cascading

biochemical reactions that regulate

these functions.

An endocrine disruptor is a chem-

ical, or mixture of chemicals, that in-

terferes with any aspect of hormone

action. Suspected endocrine disrupt-

ing chemicals (EDCs) are commonly

found in people, wildlife, and the en-

vironment. Over 800 chemicals have

been identified as having endocrine

disrupting properties. All of the 22

chemicals listed under the Stockholm Convention, a global

treaty that restricts or bans some of the most hazardous

chemicals used around the world, have endocrine disrupting

properties.20

An irrefutable body of scientific evidence and international

consensus exists about the potential adverse effects of endo-

crine disruptors on human health and the environment [ and]

the need to protect humans, and ecosystems and their con-

stituent parts that are especially vulnerable.21

The adverse effects that are increasingly linked to exposure

to chemicals with endocrine disrupting properties include: effects

on reproduction, such as infertility and reduced sperm count

and viability; breast, mammary, testicular, and prostate cancers;

type 2 diabetes, obesity, and heart disease; neurobehavioral

outcomes; and thyroid and immune system dysfunction.

There are several key features of endocrine disrupting

chemicals that make exposure to any dose of an EDC unsafe,

including:

Low-dose effects: Exposure to low doses of one or more

EDCs may result in adverse effects that are not observed

at higher doses.22

In other words, a classic (linear) dose re-sponse curve of the risk accompanying exposure at varying

levels does not apply to EDCs. As a result, conventional risk

assessment methods, which extrapolate high-dose effects

to predict low-dose effects, are inadequate to assess the

effect of EDCs, and current methodologies cannot be used

to derive safe doses of these chemicals.

Cocktail of chemicals: Populations are regularly exposed to

multiple EDCs. The effects of the individual chemicals in the

BOX 3

Endocrine Disrupting Chemicals

cocktail of chemicals to which humans and wildlife are

exposed may be additive, synergistic, or even antagonistic,

such that exposure to multiple EDCs may have a combined

effects not observed in examination of the hazards of an

individual chemical.

Exposure during critical windows of development:

Exposure to EDCs during specific critical windows of achilds development can produce permanent adverse effects.

Childhood exposure can occur pre- or post-natally through

the presence of these chemicals in mothers blood or breast

milk, food, or indoor environment.

Effects on Future Generations: Studies of the progeny

of women exposed to EDCs during their first trimester of

pregnancy show reproductive abnormalities occurred 20

times more frequently in their male grandchildren. Daugh-

ters of the women also exhibited an increased incidence

of breast cancer, vaginal, and cervical cancers, and repro-

ductive abnormalities.23These effects illustrate the dangers

of EDCs for future generations and the complexity of the

challenge for epidemiology: the adverse effect(s) of expo-

sure might not be observed until several decades afterexposure and may not affect the health of the person

initially exposed.

Ubiquity in the Environment: Polar bears in the arctic,

frogs and other forms of wildlife have all exhibited unusual

hermaphroditic traits.24These observations in remote

regions of the world illustrate the extent to which these

hazardous chemicals persist and travel throughout the

global environment through various media.


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Exponential growth in the number of patented inventions for phthalate alternatives beginning

in 1999, coinciding with the adoption of stricter rules (as captured by the number of patent

families for non-phthalate and phthalate free inventions).

REACH (Registration, Evaluation, Authorization and Restriction

of Chemicals) is the EUs comprehensive chemical regulation.

Its purpose is to ensure a high level of protection of human

health and the environment from chemicals manufactured,

imported, marketed or used within the European Union, while

enhancing competitiveness and innovation.27When adopted in

2006, REACH replaced dozens of existing EU chemical laws,

including laws from the 1970s that presumed the safety of tens

of thousands of chemicals already in commerce. This presump-

tion of safety for existing chemicals in use by the 1970s is still

in effect in the United States for industrial chemicals, but many

countries around the world are moving towards REACH-like

system.

Reversing the presumption of safety for existing chemicals,

REACH is premised on a no data, no market policy. Chemicals

manufactured in quantities greater than 1 ton per year (around

30,000 chemicals in all), must be registered with the European

Chemical Agency (ECHA). To this end, the manufacturer and

importer must report about the chemicals intrinsic properties.

Under REACHs tiered system, chemicals manufactured in the

highest quantities or those known to have hazardous properties

require more tests and are to be registered earlier in the process.

Following Evaluation of the information provided, an EU

Member State or ECHA may propose that a chemical be iden-

BOX 4

The EUs REACH Regulation

FIGURE 2

Spike in Patented Inventions Free of Hazardous Phthalates

0

5

10

15

20

25

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

Non-phthalate inventions

Inventions that can use

phthalates or non-phthalates

1998: European

Commission

SCTEE opinion and

Recommendation

1999: Temporary EU

phthalate directive

2006:

EU REACH

Reg.

Adopted

2008: 4 phthalates

added to REACH

Candidate List

number

ofpatentedinventions(aspatentfamilies)

tified as a Substances of Very High Concern (SVHCs) and placed

on the REACH Candidate List. Subsequently, a chemical on

the Candidate List may be recommended for Authorization by

ECHA. If approved by the European Commission, the chemical

is placed on the REACH Authorization List, in which case compa-

nies must request authorization for specified uses after a Sunset

Date. For more information about the Candidate Lists impact

on innovation, see Box 6, page 11.

Alternatively, a Member State or ECHA may propose a

Restriction to limit or ban the manufacture, marketing or use

of certain chemical that poses an unacceptable risk to human

health and te environment.

to the Member States of the EuropeanUnion (EU), Canada, Japan, Iceland,Mexico, Norway, Argentina, Tunisia, andthe United States are among the manycountries that took measures to ban orrestrict the use of certain phthalates.Four of these phthalates (BBP, DEHP,DBP, and DIBP) were added to the EUsREACH Candidate List, and subsequent-ly the REACH Authorization List (seeBox 4, below, and Box 6, page 11).25Through their inclusion on the Authoriza-tion List, all uses of these phthalates in theEU are required to cease by February 21,2015, unless a use has been specificallyauthorized.26 Certain Member States ofthe EU continue to pursue more stringentdomestic measures than measures at theregional level.

There is evidence that these measuressparked the invention of alternatives tocertain uses of phthalates. Publicly avail-able patent records illustrate a surge ofinventions (measured by patent fami-lies) to eliminate exposure to phthalates(see Figure 2). There is a noticeable accel-eration in the filing of patents, and thusthe pace of invention, beginning around


15/36


European Commission in July of 1998,which itself was preceded by an opinion ofthe European Commissions ScientificCommittee on Toxicity, Ecotoxicity, andthe Environment in April of 1998.29

The correlation of increased inventionin response to the prospect of stricter lawsis consistent with other lessons of the past.For example, investigations of regulatoryevents surrounding lead, mercury, PCBsand vinyl chloride also confirm that infor-

mal regulatory procedures (before formal-ized rulemaking) drove companies to de-velop their technological responses.30

However, it was not until significantlystrictly measures appeared likely (inclu-sion in the Authorization List underREACH), that major chemical manufac-turers and others significantly increasedtheir patenting of alternatives (see Figure3, page 10). Nearly one-half of the patent-ed inventions claiming an alternative to

Year Country or Region Measure

1998 European Union European Commission Scientific Committee on Toxicity, Ecotoxicity and Environment (SCTEE) opinion

on phthalates

1998 European Union European Commission Recommendation for Member States to adopt measures required to ensure a high

level of child health protection in regard to phthalate-containing soft PVC childcare articles and toys

1998 Norway Banned the production, distribution, import and export of toys and other products aimed at children aged

under three and containing phthalate plasticizers

1999 United States Voluntary ban on phthalates in teethers, rattles, and bottle nipples

1999 European Union Temporary ban on six phthalates (DINP, DNOP, DEHP, DIDP, BBP, and DBP) above a certain concentration

in toys and childcare products intended to be put in the mouth by children less than 3 years old

1999 Argentina Temporary ban on six phthalates above a certain concentration in toys and childcare products intended

to be put in the mouth by children less than 3 years old

2000 Tunisia Banned the importation, sel ling and distribution of all PVC toys and childcare articles intended to be put in

the mouth by children less than 3 years old containing any of six phthalates above a certain concentration

2001 Japan Enacted an ordinance on: Phthalates in toys to be put in mouth by children up to six years; toys of DEHP-

containing PVC resin intended for use by children up to six years; and DEHP in food utensils and vessels

2005 European Union Permanent ban on six phthalates (DINP, DNOP, DEHP, DIDP, BBP, and DBP) above 0.1 % in toys and childcare

products intended to be put in the mouth by children less than 3 years old

2006 European Union REACH adopted

2008 European Union BBP, DEHP, DBP, and DIBP added to REACH candidate list

2009 European Union BBP, DEHP, DBP, and DIBP proposed for REACH authorization list

2009 United States DEHP, DBP, BBP permanently banned above 0.1 % in childrens toys and certain child care articles. Interim ban

of DINP, DIDP, DnOP above 0.1 % in a childrens toy that can be placed in a childs mouth, and child care articles.

These six phthalates as well as DIBP and DnPP are subject to further investigation under an U.S. EPA action plan.

2011 European Union BBP, DEHP, DBP, and DIBP added to REACH authorization list

2015 European Union Only authorized uses of BBP, DEHP, DBP, and DIBP will be allowed in the EU

TABLE 1

Timeline of Certain Phthalate Measures Adopted around the World

1999, following the initial EU measures,and accelerating again in 2006, aroundthe time REACH was adopted. Thesetime points correlate with years in whichEurope led the world in adopting mea-sures to reduce the use of certain phthal-ates (see Table 1).

Considering the varying degree of re-search and development required beforethe filing of a patent, inventors likely fore-saw the enactment of stricter laws and

began research necessary for the patent ap-plication beforehand, and filed when newlaws appeared imminent to maximizetheir time period of exclusivity under thepatent.28Because these events took placelong before compliance deadlines, compa-nies were afforded the necessary lead-timeto develop and possibly patent their tech-nological inventions. For example, theEUs temporary directive in 1999 waspreceeded by a Recommendation by the

. . . these measures sparked

the invention of alternatives to

certain uses of phthalates . . . .

There is a noticeable accel-

eration in the filing of patents,

and thus the pace of invention,

beginning around 1999 and

accelerating again in 2006.

These time points correlate

with years in which Europe ledthe world in adopting stricter

measures to reduce the use

of phthalates under Directives

and REACH.


16/36


Several different indicators are

used to measure the pace of in-

novation. These include proxies

such as the number of research

publications, investment in re-

search and development (R&D),

number of scientists, and the num-

ber of patents. Each proxy has

advantages and disadvantages.

Generally, a patent provides

the right to prevent others from

making, using, offering to sell or

selling the invention patented for

a limited time period. Unlike many

other proxies, patent data is pub-

licly availablea result of the bar-

gain struck by governments, lim-

iting competition in exchange

for the inventors knowledge. In

return for a qualified right to ex-

clude others from making, using, selling or offering to sell the patented invention

for about 20 years, the public enjoys the possibility of using the inventors knowl-

edge after the patent expires, without any financial obligation to the inventor. Toobtain a patent, inventors must meet minimum standards of inventiveness, in other

words novelty and utility, and may not claim more than one invention per patent.

Thus, patents provide a relatively uniform standard unit of innovation.

Patents are not a perfect measurement of invention. The scope, value, and power

of the ideas disclosed can vary widely from patent to patent. Also, many inventions

are not patented, but rather kept as trade secrets. And the standards of patentability

can vary to some degree across countries, although there has been considerable

global harmonization recently. However, patents can serve as an indication of inter-

est in a particular scientific area, such as alternatives to phthalates. Counting patent

families, rather than individual patents, avoids the problem of counting the same

invention more than once because it has been patented in multiple countries.

BOX 5

Patents and Measuring Innovation

Number of patented inventions by Eastman Chemical (formerly Kodak Eastman), Exxon Mobil

and Dow Chemical from 19722010 for phthalate alternatives.

F I G UR E 3

Stricter Laws Trigger Innovation by Major Chemical Manufacturersphthalates reference the health and envi-ronmental concerns surrounding this classof chemicals. This surge in the invention of alter-natives to phthalates began the same timeas European laws limited the use of six

widely used phthalates in toys and otherchildrens products, a small percentage ofglobal phthalate use. To some degree,both the number of phthalates and thenumber of products within the scope oflaws around the world are increasing, and

Exxon Mobil and Dow did not

begin to aggressively patent

alternatives to phthalates until

after REACH was adopted in

2006.

stand to increase further as the deadlinefor authorization of uses for certainphthalates approaches in the EU.31 Thistrend towards stricter laws over the useof phthalates spurred the invention ofphthalate alternatives beyond the minis-cule share of the market occupied by toysand childrens products.32

The acceleration in the number ofnon-phthalate and phthalate-free patentsillustrates how the prospect of progressive-ly stricter rules against the use of hazard-

ous chemicals can incentivize, or push,companies to develop alternatives. Thenumber of patents filed throughout thisperiod of progressively stricter rules forphthalates continues to grow, suggestingthat companies continued to invent alter-natives after new laws entered into force.For example, Exxon Mobil and Dow didnot begin to aggressively patent alterna-tives to phthalates until after REACH wasadopted in 2006 (see Figure 3). This illus-trates how stricter laws can push inno-vators to develop alternatives. Eastman

moved earlier than Exxon Mobil andDow, but their strategy was to pursue in-ventions that could use either phthalate ornon-phthalate chemicals. Exxon Mobiland Dow, however, appear to be pursuingan innovation strategy around inventionsthat are free of phthalates.

0

1

2

3

4

5

6

7

8

9

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

Exxon Mobil

Eastman

Dow

numberofpaten

ted

inventions(aspatent

families)

2006: REACH

Adopted

1999:

Temporary

EU phthalate

directive


17/36


According to the European Commissions interim evaluation of the impact of

REACH on innovation in Europe (REACH Innovation Report), the Candidate List

is a, if not the, major driver for change at present.37

Among other findings, the REACH Authorization process was found to have a

similar effect to the Candidate List, but for a smaller number of firms.38Registration

of chemicals under REACH is projected to have an impact on substitution as some

chemicals may not be registered or produced at lower volumes, reducing supply

a trigger for innovation.39Safety Data Sheets (SDSs), enabling communication of

information about hazardous chemicals along the supply chain, made the strongest

contribution to stimulating the conception of new products.40

The REACH Candidate List identifies a chemical as being a Substance of Very

High Concern (SVHC) based on information about its intrinsic properties, such as:

whether it causes cancer, creates genetic mutations, negatively affects reproduction

(CMRs); persists in the environment, accumulates in living organisms, and/or are

toxic (PBTs or vPvBs); or rises to an equivalent level of concern, such as endocrine

disruptors (see Box 2, page 5). Criteria for identifying chemicals of concern based

on their endocrine disrupting properties under EU law are currently under

negotiation.41

The REACH Innovation Report suggests that the Candidate List is driving inno-

vation through substitution, reformulation, and withdrawal.42The most common

response of firms was reformulation, followed by withdrawal, substitution, and

launching of initiatives to develop new chemicals.43The European Commissions

Report also found that uncertainty regarding substances that will appear on the

Candidate List in the future is driving retailers and downstream users to request

greater levels of SVHC absence than required with under REACH.44Both of these

observations illustrate that the Candidate List is driving businesses to innovate

away from chemicals of concern.

As more information is provided about the intrinsic hazards of chemicals within

the scope of REACH, the Candidate List stands to continue to drive innovation in

the chemical industry.45With broad criteria for indentifying endocrine disrupting

chemicals and information about endocrine disrupting properties of chemicals, it

stands to reason that the Candidate List will further drive innovation.

BOX 6

The REACH Candidate List: A Key Driver of Innovation

Stricter laws drive the invention

of CFC Alternatives

Chlorofluorocarbons (CFCs) displaced am-monia, sulfur dioxide, carbon dioxide andother natural refrigerants in the 1930s.Unlike these refrigerants, CFCs were ad-opted because they offered a safer alterna-tive in terms of their toxicity, flammability,and/or energy efficiency.33Unfortunately,it was not until many decades later thatthese chemicals were widely acknowl-edged to be ozone depleting substances.34Other uses for CFCs included foam pro-duction (e.g. Styrofoam), aerosol prod-ucts, and as solvents for cleaning products

with delicate components such as elec-tronics.

Chemical companies were alert to thehuman health and environmental conse-

quences of CFC emissions as early as 1972.Following a 1972 conference, DuPontand other CFC manufacturers formed aconsortium coordinated by what is nowthe American Chemistry Council (ACC),a U.S. trade association for chemical man-ufacturers. When ozone depletion result-ing from CFC emissions began to gainsubstantial mainstream attention in 1974,members of the consortium defended thecontinued use of CFCs, and called for ad-ditional scientific evidence, insisting theirchemicals were safe until proven other-

wise. It was also argued that health andwealth would decline in a world withoutCFC products.35

Innovation of various chemical refrigerants

over the 20th and 21st centuries. Dates are

approximations based on major usage and

expected reductions under national and

international agreements.36

F I G UR E 4

Innovation Cycle of Refrigerants

HFCs

1985present

HCFCs

1950s2030*

CFCs

1930s1980s

NaturalRefrigerants

(e.g. hydrocarbons,SO2 & NH3)

1850spresent


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Simultaneously, research and develop-ment into alternatives was well-underway,

with several alternatives identified. Dur-ing debate over stricter measures on CFCsand other ozone depleting substances, rep-resentatives of DuPont and other CFCmanufacturers stated that they had identi-fied technically viable alternatives to CFCsbetween 1975 and 1980, but could not in-troduce these alternatives because, by theirestimates, the alternatives would not beeconomically viable (see Chapter 4).46Later, these manufacturers acknowledgedthat it was the lack of legally-enforceablestandards that prevented the entry of saferalternatives.47

The United States, Canada, Sweden,and Norway announced plans to ban non-essential aerosol products in 1976, aided

in part by slumping sales of CFC-contain-ing products due to consumer concern.These laws at the national level spurredchanges in the industry, most notably inthe United States. Changes in the U.S. in-dustry in turn positioned the UnitedStates to push more actively for interna-tional laws over ozone depleting substances,given its own competitive advantage.48

In 1987 countries around the worldagreed on a timeline for the global phaseout of CFCs under the Montreal Protocol.

A patent search by the World Intellectual

Property Organization showed that vari-ous chemical manufacturers and other di-versified businesses in both Japan and theUnited States patented a variety of pro-cesses, including the process for the manu-facture of one of the most widely usedalternatives to CFCs, hydrofluorocarbon(HFC)-134a, in 1987 and 1988.49

Thus, the prospect of stricter laws atthe national and global level spurred in-

Chemical

Ozone depleting

potential (relative

to CFC-11)

Global warming

potential (relative

to CO2) Other hazardous properties

Ammonia* 0 < 1 Highly toxic (but odor enables

evacuation), slightly flammable

Carbon Dioxide* 0 1 Toxic at high doses

CFC-11 1 4,600

CFC-12 0.820 10,600

HCFC-22 0.034 1700

HFC-134a 0 1300

Hydrocarbons* 0 ~20 Flammable

* Natural refrigerants50

TABLE 2

Intrinsic Properties of Various Chemical Refrigerants

ventors to research alternatives to CFCs

and hydrochlorofluorocarbons (HCFCs),leading to the development of both HFCsand inventions for the safer use of natu-ral refrigerants (used in the 1930s beforeCFCs) as alternatives to CFC refrigerants.HFCs prevailed over ammonia, carbon di-oxide and other natural refrigerants dueto the cost advantages. However, whileHFCs are not ozone depleting substances,they are potent greenhouse gasses. Aidedby stricter laws in Europe that phasedout HFCs in new cars after 2011, andpublic campaigns to use hydrocarbons in

domestic refrigerators, considerable re-search and development continued aroundthe use of natural refrigerants. Incremen-tal inventions enabled these natural re-frigerants to overcome properties deemedundesirable almost a century ago (seeTable 2). With the continued develop-ment of natural refrigerants, hydrocarbondomestic refrigerators are now economi-cally viable and commonly available in

Europe and Asia, with both environmen-

talists and manufacturers alike advocatingfor the U.S. to adopt them as well.51In ad-dition, suppliers of equipment using ammo-nia rather than HCFCs recaptured marketshare in cold storage and food freezing.52

The prospect of progressively stricterlaws over CFCs and other ozone depletingsubstances sparked the continuous inven-tion of alternatives, including improvedmethods of using natural refrigerants,making the chemicals once displaced byCFCs a viable alternative to ozone-deplet-ing substances and greenhouse gasses. To-

gether, the experiences of both phthalatesand CFCs illustrate how the systematic in-troduction of progressively stricter rules atthe global and regional levels spurred thecontinuous invention of safer chemicals,averting the serious consequences of inac-tion and disproving the estimated cost ofaction.


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For quite some time I have been confronted with problems from the

plasticizers in vinyl for aerospace applications and I have long since

come to the conclusion that vinyl should not be permitted in any

phase of aerospace usagesubstitute polymers for the vinyl are

readily available and in many cases they have far superior physical

properties at a small sacrifice in immediate cost.

April 26, 1971 (A letter to Chemical and Engineering Newsfrom Frederick G. Grossof the NASA Materials Engineering Branch)53

C H A P T E R 3

Chemical Laws Can Pull Safer Inventions into the MarketBut Not All Alternatives Are Safer

Innovation hinges on the adoption ofan invention. As illustrated above,chemical laws can accelerate the in-vention of alternatives to hazardous

chemicals. To replace widely used hazard-ous chemicals, inventors created newchemicals and processes, developed new

uses for existing chemicals, and found al-ternative approaches. The spike in inven-tion to eliminate certain phthalates showsthat environmental laws can be a criticalelementa driverin accelerating inven-tion in the chemical industry.

Chemical laws can also pull inventionsinto the market, thereby turning inven-tion into innovation. The above examplesof CFCs and phthalates illustrate this.Some of the alternatives that were used forcertain phthalates and CFCs existed well-before the prospect of stricter laws was onthe horizon. Until the prospect of enact-ing stricter restrictions on the use these en-trenched and hazardous chemicals, thesealternatives were sidelined, with far lessopportunity for adoption in the marketand further development through experi-ence gained from their successes andshortcomings.

However, some of the replacements forchemicals of concern have been very un-satisfying. History is replete with examplesof regrettable substitution, where years ofconcerted effort is undertaken to restrict orphase-out an individual chemical of con-

cern, only to see the chemical replacedwith a different chemical of concern.54 Thisunsatisfying transition has undermined theconfidence of the public and businesses inthe ability of innovation alone to ensuremeaningful progress towards safer alterna-tives. Below, a cross-section of examples ofsubstitution is presented, ranging fromclearly regrettable substitutes, to the entryof alternatives that raise questions, and, fi-nally, to more promising examples.

Regrettable substitution

Over the last several decades, demand forchemical flame-retardants has accelerated.Production increased from just over 500million pounds in 1983, to 3.4 billionpounds in 2009, and is projected to jumpanother 30 percent to 4.4 billion poundsby 2014.55The transition away from toxicflame retardants provides one example for

regrettable substitution.Polychlorinated biphenyls (PCBs) andpolybrominated biphenyls (PBBs) were

widely used as flame-retardants until the1970s, when health and environmentalconcerns began to surface. When PCBsand PBBs were banned as flame retar-dants, polybrominated diphenyl ethers(PBDEs) took their place in the market asflame-retardants. Under U.S. and Euro-pean laws at the time, PBDEs were con-sidered existing chemicals, meaning noevidence of safety was required for thesechemicals to remain on the market when

they were introduced. Production and useincreased rapidly for PBDEs over the nextseveral decades as new markets for thememerged, or were created, including furni-ture foam, electronics, textiles, and babyproducts. PBDEs are a regrettable substitute forPCBs as flame retardants. Overwhelmingevidence has emerged about the hazards ofPBDEs, including their endocrine dis-rupting properties.56 Not only do thesechemicals exhibit toxicity at both high and

low-doses, but they persist in the environ-ment rather than breaking down into saferconstituents, accumulate in living organ-isms, and travel long-distances through

wind, water, animals in which they accu-mulated, and products traded internation-ally. As evidence of the dangers of PBDEsgrew overwhelming, many countries aroundthe world began to phase out certainPBDEs, creating the possibility for the en-try of safer alternatives. In other countries,manufacturers of PBDEs agreed to volun-tarily discontinue the production and saleof these chemicals. Two types of PBDEs

were banned in 2009 under the Stock-holm Convention, a global treaty that ap-plies to some of the worlds most hazard-ous chemicals. PBDEs are one example ofregrettable substitution among a cluster oftoxic flame retardants. Unfortunately, one of the replacementsfor certain PBDEs is yet another episodeof regrettable substitution. Firemaster 550,

a mixture of several chemicals, was ap-proved for use by U.S. EPA in 2003 underthe U.S. Toxic Substances Control Acts(TSCAs) provisions for the approval ofnew chemicals.57 Because of the limitedpower for regulators to demand sufficientproof of safety before a new chemical isproduced for use, the U.S. EnvironmentalProtection Agency (U.S. EPA) could onlyuse the scant information provided by themanufacturer (Chemtura) and computermodels to predict the chemical mixtures


20/36


B Firemaster 550 ingredient

TBPH: In use as an alternative

to PBDE flame retardants

toxicity. According to an U.S. EPA offi-cial, [w]e didnt think [Firemaster 550]

would bioaccumulate, but it turns out thatprediction isnt borne out by reality.58

Regulators in the U.S. approved Fire-master 550 for use, even though it hadsuspicions, including the structural simi-larity of a chemical ingredient of Firemas-ter 550 to DEHP, a phthalate restrictedfrom certain uses due to evidence that it isa reproductive toxin (see Figure 5). U.S.authorities asked the manufacturer, Chem-tura, to provide additional studies. Chem-tura provided two of its own studies, fiveyears later, which showed adverse effects athigh-doses, such as skeletal malformationsand low-birth weight. The company arguedthat these were inconclusive. Although advertised as a green re-

placement to PBDEs,59 evidence contin-ues to emerge that one or more ingredi-ents of Firemaster 550 are released fromproducts containing the mixture, could betoxic, accumulate in wildlife, travel long-distances through the environment, and mayhave adverse effects at low-doses. Like PB-DEs and structurally similar phthalates,recent studies indicate that some of Fire-master 550s ingredients have endocrinedisrupting properties.60 As one group ofresearchers reported:

This exploratory study reveals, for thefirst time, the potential for perinatalFM [(Firemaster)] 550 exposure to haveadverse effects indicative of endocrinedisruption, at levels much lower thanthe [No Observed Adverse Effect Level(NOAEL)] reported by the manufac-turer. These findings are significant be-cause FM 550 appears to be one ofmost commonly used replacements forPBDEs in foam and is prevalent inhouse dust.61

However, Firemaster 550 remains in use.

Questionable Substitution

The inventions introduced as alternativesto the handful of phthalates singled out bythe law illustrate the potential for regret-table substitution. A chemicals form andfunction are closely linked. The form of amolecule determines both its function in apolymer, as well as its function in bio-chemical pathways, which may lead to ad-verse effects. Although slight changes to achemicals structure can make a difference

Structurally similar alternatives that have been used as substitutes for hazardous chemicals:

(A) DEHP, a hazardous phthalate with restricted use in many countries; (B) TBPH, an ingredient

of Firemaster 550, a substitute for toxic flame retardant chemicals; (C) DINP, a hazardous

phthalate with restricted use in many countries; (D) DINCH, a substitute for hazardous phthalates

DEHP and DINP; and (E) DPHP, another substitute for DEHP and other hazardous phthalates.

Use restricted does not mean that it is restricted from all products or in all countries.

FIGURE 5

Risky Transition to Structurally Similar Chemicals as Substitutes for

Hazardous Chemicals

E DPHP: In use as alternative to

DEHP and other suspect phthalates

A DEHP: Use restricted

(general purpose phthalate)

C DINP: Use restricted(general purpose phthalate)

D Hexamoll DINCH: In use asalternative to DINP and other

suspect phthalates

Hazardous Chemicals with UseRestricted

Structurally similar substitutes for

hazardous chemicals, increasingly

questioned regarding their ownsafety

in terms of its physical or biological func-tionality, there is a significant likelihoodthat the substitute chemical will not be de-void of intrinsic hazardous properties.

While these slight structural modificationsto hazardous chemicals can minimize theredesign of products and processes, chem-ical-by-chemical approaches to hazardouschemicals can delay a meaningful transi-tion to safer alternatives.

The substitution of certain phthalatesof concern is an example of the substitu-

tion of structurally similar chemical alter-natives. These structurally similar chemi-cals include both non-phthalates, such asBASFs Hexamoll DINCH (DINCH), as

well as different phthalates, such as DPHP(see Figure 5). Given the similarity inchemical form and corresponding poten-tial for similarity in biological function,heightened attention is warranted aboutthe potential for regrettable substitutionin these cases.


21/36


A structural analog to the phthalate DINP(see Figure 5), DINCH is said to be a suit-

able direct substitute due to its similarplasticizing performance. Given the struc-tural similarity to phthalates, in particularDINP, a heightened level of scrutiny ap-pears prudent. However, there is a lack ofavailable exposure and toxicological dataon DINCH.66 Among those available,short-term, sub-chronic, chronic, and two-generation reproductive oral studies in ratsdid however show effects of DINCH onthe liver, urinary tract and, in particular,thyroid.67Of particular concern, given theendocrine disrupting properties of struc-turally similar phthalates to DINCH, isthat studies were insufficient with respectto information on dose-response relation-ships.68

DINCH was developed by chemicalmanufacturer BASF Corporation around2003 for use as a PVC plasticizer and, spe-cifically, to replace DEHP and DINP inproducts such as food contact applications,childcare articles, and childrens toys.62Other targeted application areas includemedical articles and shoes, as well as non-PVC applications such as adhesives, cos-metics, artificial leather, textile coatings,and erasers. DINCH has been shown tomigrate from PVC food contact surfacesinto food, particularly into high fat con-tent food such as oils and cheeses.63 Thisalternative is an attractive substitute tophthalate manufacturers because DINCHis produced through the conversion (hydro-genation) of DINP to DINCH.64

According to staff at U.S. Consumer

Products Safety Commission (CPSC):

No published studies of DINCH werefound. The only information locatedregarding the health effects of DINCH

was found in the [Scientific Commit-tee on Emerging and Newly IdentifiedHealth Risks (SCENIHR)] (2007) re-port, which contained summaries ofunreferenced and unpublished studiessubmitted by BASF Corporation, andin an abstract/summary of one of thesestudies submitted by BASF Corpora-tion to EPA under the Toxic Substanc-es Control Act (TSCA) and identifiedin the search of the [TSCA] database[of testing results].65

The CSPC analysis concludes that[w]hile DINCH is entering the market as

a component of consumer products suchas childrens articles, the insufficiency ofthese study summaries preclude indepen-dent evaluation of the results and reliableidentification of adverse effect levels.69In2012, several years after its approval, U.S.EPA requested that DINCH be added toits list of Priority Testing Substances foradditional testing data.70Health and Safe-ty Data Reporting (HaSDR) rules underTSCA require importers, manufacturersand processors of Priority Testing Listchemicals to submit unpublished Healthand Safety studies within 90 days ofthe rules date of publication in the U.S.Federal Register. The tendency to transition to structur-ally similar alternatives to minimize thedisruption to existing production process-es and business models highlights the needto produce and review sufficient informa-tion before alternatives are adopted as sub-stitutes for hazardous chemicals.

More Promising Examples

of Substitution

Chemists have invented ways to design

chemicals that are inherently safer. Anolder example is the ability to design chem-icals so that they do not persist as long inthe environment.71One such technique isthe use of secondary nitrogen atoms in-stead of tertiary nitrogen atoms to en-hance biodegradability, as demonstrated

with the use of ethylenediamine-N,N-disuccinic acid (EDDS) instead of ethyl-enediaminetetraacetic acid (EDTA) as acomplexing agent (see Figure 6). Com-plexing agents like EDTA can be used to

The conversion of EDTAs tertiary nitrogen atom to a secondary nitrogen atom (EDDS)

enables EDDS to degrade faster and thus mobilize less toxic metals in the environment, while

also out-performing the more persistent EDTA by other standards of performance as well.

FIGURE 6

Chemicals Can Be Designed to Be Safer

E DTA E D DS


22/36


improve cleaning efficiency by sequester-ing metals in water-based solutions, butalso raise concerns about their ability tomobilize toxic metals in the environment.72EDTA has been phased-out for certain ap-plication in some countries and regions.73EDDS is far more biodegradable thanEDTA, and also performs better as a com-plexing agent in some applications.

More recently, scientists have created acost-effective system that they believe willhelp industry more effectively identifyand avoidchemicals with endocrine dis-rupting properties.74 To ensure that theprotocol remains current as the scientificunderstanding of endocrine disruptioncontinues to advance, the inventors estab-lished a plan for incorporating new assaysinto the protocol.

With the increasing stringency of mea-sures on the use of certain phthalates, in-cluding the scheduled phase out of fourphthalates (DEHP, DBP, BBP and DIBP)from certain products in the EU by 21Feb. 2015, alternatives to certain phthal-ates are increasingly being demonstratedas viable and adopted. While DINCH andphthalate-based alternatives raise ques-tions, other alternatives to phthalates showmore promise. For example, a castor oil-based alterna-tive to phthalate plasticizers for PVC

(Soft-n-Safe) was invented through ex-periments with different types of raw ma-

terials as feedstocks. It has been approvedfor use in food contact surfaces, vinylflooring and wallpaper, toys, medical de-vices, inks, textile dyes, and other appli-cations.75This direct substitute does notexhibit many of the intrinsic hazards ofphthalates and other plasticizers. Notably,and unlike the phthalates they replace,studies show no evidence of endocrinedisruption or other adverse effects for thisalternative.76

resists smoldering cigarettes, preventingunderlying foam from igniting. In addi-tion, researchers developed nontoxic fire-resistant barriers for couches, using an ear-lier concept for mattresses. Both of thesealternatives are far more effective at slow-ing fire than adding flame retardants tofoam, which in fact does not slow the fireby any significant degree according to sev-eral tests by government agencies and in-dependent laboratories.78

The above examples illustrate how in-vention has been sparked by laws to re-duce or eliminate hazardous chemicals.First-movers may have a considerable ad-vantage over competitors as demand andrequirements for safer products increase.

Legal controls cleared the way for theadoption of alternatives, pulling newly de-

veloped or pre-existing solutions to occu-py the space vacated by certain hazardouschemicals. In order to increase the likeli-hood that safer alternatives will be pulledinto the market, the law needs to clearlyidentify hazardous properties that are notacceptable in society and require their sub-stitution with safer alternatives (includingnon-chemical alternatives) in a systematic

way. For example, the EUs REACH au-thorization procedure gives a clear signalto industry that chemicals that are carcin-ogens, mutagens, or toxic to reproduction,

or those that exhibit persistence and bio-accumulation, need to be substituted withsafer alternatives. This provides clear di-rection to chemical manufacturers anddownstream users of chemicals that theymust innovate away from chemicals withthese properties.

The availability of information aboutchemical hazards and the prospect of regu-latory action accelerate research towardssafer solutions, whether it is through theinvention of new chemicals, new applica-tions of existing chemicals, new materials,

or new processes.

79

But, critically, stricterrequirements that chemical manufacturersgenerate information about intrinsic haz-ards and exposures can drive innovation ina safer direction. Without informationabout the full scope of intrinsic hazards ofall chemicals, downstream businesses arehighly vulnerable to investing in the sub-stitution of one hazardous chemical with adifferent hazardous chemical. Some mightsay they risk jumping from the frying paninto the fire.

In order to increase the like-

lihood that safer alternatives

will be pulled into the market,

chemical laws need to clearly

identify hazardous properties

that are not acceptable in

society, generate information

about these properties in all

chemicals, and require their

substitution with safer alter-

natives in a systematic way.

Specially designed upholstery

and fire-resistant barriers are

shown to be more effective at

slowing fires than the addition

of toxic flame-retardant chemi-

cals to furniture foam, which

contaminate indoor and outdoor

environments and are linked

to adverse health effects.

In the effort to remove phthalates fromproducts, other companies have removeda principle reason phthalates are used inthe first placePVC. For example, officeproducts retailer Staples removed PVCfrom its packaging materials. Downstream

users are also removing phthalates by re-moving the PVC. Of particular concern isthe use of phthalate-containing PVC forblood bags and other infusion/transfusionsets, which can subject very young chil-dren to hazardous levels of the phthalateDEHP during critical windows of devel-opment. As a result of recent measures forcertain phthalates, medical suppliers thatprovide phthalate-free alternatives to PVCmedical devices are experiencing a boomin both demand and growth.77

Innovators have also found safer alter-

natives to treating furniture foam with toxicchemicals to prevent furniture fires. Forexample, specially designed upholstery can


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It is commonly accepted that a chemi-

cals risk is a function of intrinsic hazards

and exposure. Most efforts at reducing

risk to human health from chemicals have

focused on reducing the probability and

magnitude of exposures. The track re-

cord for predictions of exposure is abys-

mal.80Green chemistry deals with risk by

seeking to eliminate intrinsic hazards

rather than by controlling exposure.81

Over the past several years, the con-

cept of green chemistry has increasingly

been embraced by a range of businesses

that produce and use chemicals.82 This

promising approach to chemical syn-

thesis and manufacture aims to design

chemicals that meet the functional de-

mands of the market, but are also inher-

ently safer and more resource- and-energy-

efficient. In other words, green chemistry

is the design of chemical products and

processes that reduce or eliminate the

use and generation of hazardous substances. Fewer hazardous

substances mean less hazardous waste and a healthier environ-

ment. These changes can create safer jobs, produce healthier

lives, and reduce economic costs to businesses from the use

or generation of toxic chemicals.83

The twelve principles of green chemistry84are:

1. Design safer chemicals and products: Design chemical

products to be fully effective, yet have little or no toxicity.

2. Prevent waste:Design chemical syntheses to prevent

waste, leaving no waste to treat or clean up.

3. Design less hazardous chemical syntheses:Design the syn-

thesis of a desired chemical such that only substances with

little or no toxicity to humans and the environment are used.

4. Use renewable feedstocks:Use raw materials and feed-

stocks that are renewable rather than depleting. Renewable

feedstocks are often made from agricultural products or

are the wastes of other processes; depleting feedstocks

are made from fossil fuels (petroleum, natural gas, or coal)

or the mining of metals and minerals.

5. Design chemicals and products to degrade after use:

Design chemical products to break down to innocuous

substances after use so that they do not accumulatein the environment.

6. Maximize atom economy:Design syntheses so that the

final product contains the maximum proportion of the start-

ing materials. There should be few, if any, wasted atoms.

7. Increase energy efficiency:Run chemical reactions at ambi-

ent or room temperature and pressure whenever possible.

8. Use catalysts, not stoichiometric reagents:Minimize

waste by using catalytic reactions. Catalysts are used in

small amounts and can carry out a single reaction many

times. They are preferable to stoichiometric reagents,

which are used in excess and work only once.

BOX 7

Green Chemistry

9. Avoid chemical derivatives:Avoid using blocking or

protecting groups or any temporary modifications if possi-

ble during synthesis. Derivatives use additional reagents

and generate waste.

10. Use safer solvents and reaction conditions:Avoid using

solvents, separation agents, or other auxiliary chemicals.

If these chemicals are necessary, use less harmful or

hazardous chemicals.11. Analyze in real time to prevent pollution:Include real-

time monitoring and control during chemical synthesis to

minimize or eliminate the formation of byproducts.

12. Minimize the potential for accidents:Design chemicals

and their forms (solid, liquid, or gas) to minimize the poten-

tial for chemical accidents including explosions, fires, and

releases to the environment.

Venture capital and private equity investors are increasingly

interested in companies inventing and developing alternatives

to chemicals of concern. Investors see green chemistry as one

of the most promising investments in looking towards 2015.85

Analysts reported continued growth in investments to green

chemistry firms, rising to 30 deals averaging around $20million each in 2011.86

A 2011 assessment of green chemistrys market potential

estimated it could soar from an estimated US$ 2.8 billion in

2011 to US$ 98 billion by 2020.87To the extent that safer sub-

stitutes displace more hazardous substances in the market, this

represents a positive step in the right direction. Yet, even at

this rapid pace, green chemistry would amount to a mere 1.5

percent of the 2020 market;88a positive contribution, but

not a solution.


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C H A P T E R 4

Stricter Chemical Laws Can Enable Safer Alternativesto Penetrate Barriers to Entry

The ability of chemical laws topull inventions into the marketis a crucial aspect of the poten-tial power of chemicals policies

to spur innovation toward safer alternatives.Businesses may argue that environmentallaws follow the invention of alternatives to

hazardous chemicals, and thus is not adriver of innovation (see Figures 1 and 2).But, it is the prospect of stricter measuresthat often drives the research and develop-ment of new ideas, and later enables theentry of these ideas into the market.89

Part of this ability comes from thepower of the law to enable new ideas, saferalternatives in this case, to overcome barri-ers to entry. Even if a safer alternative to achemical of concern is invented and avail-able for adoption, there are many factorsthat present barriers to its entry into themarket. One factor is the substantial econ-omies of scale for existing chemicals. Sec-ond, the continued externalization of costsby the chemical industry makes it difficultfor safer alternatives to compete on a levelplaying field. A third factor is an inabilityof businesses, consumers, and regulatorsto access information about the hazards ofchemicals and products containing haz-ardous chemicals. These three factors arediscussed below.

Stricter laws enable safer

alternatives to overcome

economies of scaleAfter years of insufficient action to dis-place hazardous chemicals, many chemi-cals of concern on the market today enjoysubstantial economies of scale relative tonewer alternatives. These economies of scaleresult not only from the economies inher-ent in higher production volumes, butalso from long periods in which innova-tions could occur around their productionand use, with resulting increases in effi-ciencies and demand. The discovery of

new uses, increasing production volumesand the development of more efficientprocesses for chemical synthesis enable ex-isting chemicals to become more and moreentrenched in products and processes. Forexample, methyl bromide, an ozone de-pleting substance being phased-out under

the Montreal Protocol, was invented inthe early 1900s and initially used as a fireextinguisher, but did not grow into one ofthe most widely used pesticides until the1980s.

Projections for a relatively small marketsegment for green chemistry (see Box 7),together with the estimated 50% increasein the chemical industrys output from20102020, suggests that the majority ofthe expansion of chemical production anduse will be from the continued use of thecurrent mix of chemicals in commerce.90This, together with projection for the con-tinued expansion of the chemical industryin the coming years, suggests that ques-tionable chemicals are poised to enjoy ad-ditional economies of scale. It stands to

reason that as long as the existing productmix is deemed acceptable under law, greenchemistry will face difficulty breaking intoa market dominated by large companies

with sunk investments in the status quo.Methyl bromide, CFCs, and phthalates

provide examples of the economies of

scale enjoyed by incumbent chemicals andthe ability of stricter laws to enable alter-natives to overcome this barrier to entry.

Methyl bromide offers one example ofhow stricter laws can enable alternatives toovercome economies of scale. Restrictingthe production of methyl bromide causedthe price of methyl bromide to increase400 percent from 19952001, making al-ternatives more cost-competitive.91 Thisprice increase enabled the further develop-ment and demonstration of alternatives tomethyl bromide. For example, the U.S.EPA notes that, with additional testing,steam sterilization could become a tech-nically and economically feasible non-chemical alternative to methyl bromide.92

For years DuPont and other manufac-turers argued that alternatives to CFCs

were identified but not economically via-ble, thanks in large part to the economiesof scale enjoyed by CFCs.93Their analysessuggested higher costs to consumers, andlower profits to chemical manufacturers.DuPont claimed that it ended its US$ 15million research program for alternativesin 1980 because company leaders believed

the options developed would be uneco-nomical due to the investment necessaryto modify changes production facilities,and the time required for developmentand marketing.94Cost estimates for HFCsby industry were three to ten times thecost of CFCs.95 These costs projections

were not borne out by reality.96Moreover,there is consensus among stakeholdersthat the costs of preventing ozone deple-tion are far less than the consequences ofinaction.97


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ate plasticizer products are, according tothe former industry scientist, [u]navail-able in sufficient quantities or at competi-tive pricing to supply a large portion offlexible PVC market.102

However, lower manufacturing capac-ity and relatively higher prices will alwaysbe the case for potential alternatives tochemicals entrenched in various uses, suchas general purpose phthalates, when theyare first introduced. This does not meanthat manufacturing facilities for the pro-duction and use of a chemical of concerncannot be converted over time, or thatprices will not fall as economies of scaledevelop as production and use of the saferalternative increases. For example, EastmanChemical obtained facilities to increase itscapacity to manufacture non-phthalate

plasticizers.103Legal measures also have arole to play in creating incentives for nec-essary changes in production facilities, asexemplified by co

Innovation Chemical Feb2013

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