Producer
Lubrizol Corporation
Specialty chemicals; near-monopoly on Carbopol cross-linked polyacrylic acid gelling agents.
3
Inputs supplied
3
Goods downstream
0
Facilities
0
Stories
What they make
3 inputs Lubrizol Corporation supplies
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What else they do
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Lubricant Additives
55%Personal Care and Pharmaceuticals (Carbopol)
25%Engineering Materials (CPVC)
15%Industrial Fluids and Advanced Materials
5%
Intelligence
What's known
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Concentration2011
Warren Buffett's Berkshire Hathaway acquired Lubrizol Corporation in 2011 for $9.7 billion — one of the largest acquisitions in Berkshire Hathaway's history. Berkshire Hathaway is therefore the ultimate owner of the world's near-monopoly supplier of Carbopol, the gelling agent in hand sanitizers, pharmaceutical topical gels, ophthalmic eye drops, and prescription burn wound dressings. This ownership fact is rarely discussed in pharmaceutical supply chain risk contexts: the conglomerate whose consumer brands include GEICO insurance, BNSF railroad, Dairy Queen, and Fruit of the Loom also controls the supply of the polymer that makes hand sanitizer thick, keeps testosterone gel on skin long enough to absorb, and helps eye drops stay in contact with the cornea. Berkshire Hathaway's 2011 Lubrizol acquisition predated public awareness of pharmaceutical supply chain concentration by approximately a decade. When COVID-19 made Carbopol shortage front-page news in 2020, no major analysis identified Berkshire Hathaway as the ultimate controller of the chokepoint.
Berkshire Hathaway Inc. ↗Did you know2024
Lubrizol Corporation -- the company that supplies ~80% of global pharmaceutical-grade carbomer for topical gels -- is a wholly-owned subsidiary of Berkshire Hathaway, Warren Buffett's holding company. Buffett acquired Lubrizol in 2011 for $9 billion. The world's most famous value investor accidentally controls the critical polymer that turns pharmaceutical gel formulations from liquids into gels -- and that became a global shortage bottleneck during the COVID pandemic. Berkshire Hathaway's portfolio includes GEICO, Dairy Queen, See's Candies, and most of the world's pharmaceutical carbomer.
Berkshire Hathaway Inc. ↗Capacity2020
Lubrizol invested $20M in 2018 to expand Carbopol capacity, then accelerated completion months ahead of schedule in early 2020 to respond to COVID-19 — the investment coincidentally arriving just as global gel sanitizer demand exploded.
Cosmetics & Toiletries ↗