Iran War Exposes Medicine Pricing's Deep Oil Vulnerability: Methotrexate Costs Surge Up to 87%
核心洞察
The Iran War revealed that wholesale costs for essential medicines rose 19% to 87% due to petrochemical and transportation price spikes, with methotrexate seeing the largest increase.
Benzene (搜索) prices surged 48% and global container shipping rates jumped 86% since the war began, exposing the pharmaceutical supply chain's heavy reliance on oil-derived inputs.
Only 22% of global pharmaceutical firms conducted geopolitical risk assessments at the end of 2025, highlighting a dangerous preparedness gap in supply chain resilience.
The Iran War has laid bare a critical vulnerability at the heart of global pharmaceutical supply chains: medicines are profoundly sensitive to oil market shocks. According to a new analysis from Think Global Health (TGH), wholesale costs for 10 commonly used essential medicines rose between 19% and 87% during the conflict, driven by surging petrochemical prices and transportation disruptions. Methotrexate—a benzene (搜索)- and ammonia-derived drug used in cancer (搜索) treatment—experienced the steepest increase, while metformin, a mainstay of type 2 diabetes (搜索) care, saw the smallest.
On June 17, the United States and Iran signed an initial agreement outlining terms to end the war, including an immediate and permanent ceasefire and a guarantee that prewar traffic levels through the Strait of Hormuz would be restored within 30 days. Yet experts caution that the pharmaceutical supply chain may feel the aftershocks for weeks or months due to the industry's long manufacturing and distribution lead times.
The Omnipresence of Oil in Drug Manufacturing
The synthesis route for a simple generic tablet begins with crude oil, which is refined into transportation fuel and into naphtha—a key intermediate fed into crackers to produce petrochemical feedstocks for active pharmaceutical ingredient (API) and key starting material (KSM) manufacturing. Ammonia, another chemical precursor, is also used in API formulation for certain products. Petrochemicals remain instrumental through packaging, medical device manufacturing, and distribution.
TGH's drug-price breakdown modeling tracked four key petrochemicals—propylene (搜索), benzene (搜索), ammonia, and butadiene (搜索)—and found significant price increases across all of them. Benzene experienced the sharpest uptick, with cross-regional median prices increasing 48% between February and June. Propylene prices rose 38% over the same period. Butadiene saw a 36% price jump in Northeast Asia, likely due to the region's dependence on naphtha cracker imports. Ammonia prices proved more volatile, with a median increase of 11% since the war's outset.
Transportation Costs Compound the Crisis
The cost of transportation—the second pathway through which oil price volatility impacts pharmaceutical prices—also surged. Global container shipment rates increased 86% since the beginning of the war, with a particularly sharp rise since early May amid uncertain fuel pricing. Airfreight prices climbed 27%, with the steepest increase occurring in early March when Gulf region airspaces and Middle East transit hubs were shut down.
The gap between ocean and air transportation cost estimates across all drugs was unsurprisingly wide given the significant maritime disruptions from the Strait of Hormuz closure. Dubai, a consolidation hub for pharmaceutical shipments, saw indirect routing disruptions that forced companies to consider shipping full containers directly from India and China to Europe, increasing freight costs and extending lead times.
Modeling the Impact on Essential Medicines
TGH's analysis found that wholesale medicine costs are sensitive to upstream oil-based inputs across all selected WHO essential medicines, though the degree of change varies by drug. Methotrexate's wholesale price was most impacted by the supply-chain shock, followed closely by bisoprolol—a propylene (搜索)-derived beta-blocker for hypertension (搜索)—and fluoxetine, the benzene (搜索)-derived SSRI commonly known as Prozac. Metformin was least affected overall, particularly when following an air-cargo shipment route.
The real-world consequences have already materialized. An India-based company producing methylamine, an ammonia-derived chemical intermediate for many APIs, announced that one of its plants was nonoperational due to shortages from ammonia suppliers. In Malaysia, the world's leading nitrile glove exporter supplying 45% of global demand, WRP Asia Pacific (搜索) shut down operations in April due to butadiene (搜索) price increases. Top Glove (搜索), the world's largest nitrile glove manufacturer, reported raw material costs had increased by 50%, forcing a 40% price increase on its products.
The Preparedness Gap
The conflict has exposed a dangerous lack of readiness across the pharmaceutical industry. According to Argon & Co (搜索)'s Operations Outlook 2026 research, based on a survey of over 800 C-suite leaders, only 22% of global pharmaceutical firms were actively conducting risk assessments for geopolitical threats at the end of 2025, with the same proportion developing formal scenario planning capabilities.
The challenge is compounded by competing priorities: 62% of life sciences leaders reported relentless pressure to reduce operational costs, while 40% cited rising raw material costs as their biggest supply chain issue. "Companies recognise the need to invest in resilience, but margin constraints mean they are being highly selective in where and how they act," noted Michel Savini, associate partner at Argon & Co (搜索).
Who Bears the Burden
In the face of uncertain future prices, wealthier and more risk-tolerant buyers can afford to pay higher freight costs and secure alternative routes, potentially creating shortages or price spikes for import-dependent and resource-constrained regions. Asia and Africa, along with smaller procurement agencies, are particularly vulnerable.
TGH emphasizes that the location and flows of KSMs, APIs, excipients, packaging inputs, and finished doses are not publicly available, meaning purchasers cannot accurately anticipate shortages or design effective mitigation measures during supply shocks. "Given the close relationship between petrochemical and pharmaceutical prices, governments, manufacturers, and distributors should ensure this visibility extends upstream, all the way to petrochemical precursors," the analysis concludes.
Building Resilience for the Next Crisis
The vulnerabilities exposed by the Iran War underscore the need for systematic scenario planning embedded in everyday decision-making. Argon & Co (搜索) recommends segmenting supply chains based on product criticality, ensuring essential medicines are supported by dual sourcing, increased safety stock, and dedicated logistics capacity. Building digital twins of distribution networks can allow firms to model alternative scenarios and routes in real time.
"Quick fixes won't be enough if the Middle East conflict prolongs and, even if it doesn't, the next disruption is likely closer than we think," Savini warned. "The current preparedness gap in pharmaceutical supply chains makes this a critical moment for leaders to act."