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Indian Nutraceutical Industry: Setting itself to a new normal
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July 14 , 2020
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Demeanours exhibited by the Indian nutraceutical industry during crisis times of COVID 19 will make a long lasting impression on consumers.
It is interesting to find that, COVID 19 pandemic has dramatically changed consumer preferences and lifestyle priorities. The wellness trend has engrossed almost in India and worldwide likewise.
Eating healthy, has engaged minds of every consumer. COVID 19 has made enduring changes to consumer preferences towards privacy and health. People’s aspirations for long and healthy living, as well as increasing life expectancy is casting a really good impact on nutraceutical industry in India.
A strong urge for immunity-booster products is another green field opportunity towards bright top and bottom lines. While traditional formats such as tablets and capsules might still be of importance, however novel delivery systems of nutra and herbal actives shall also be on ‘innovation priority’ form consumer convenience point of view.
Indicators of New Normal
The new web based technologies and telecom have made it possible to interact and work in newer ways, thus reducing need of physical togetherness. Media reports state that, more than three billion inhabitants live in the countries, who have closed down borders for non-residents.
Hopefully someday the tourists will return and travelling may begin, however not to the same old status as predicted by the, planning and projection experts. It is a clear event of preferring ‘Local’ versus ‘Global& thus supporting, traditional nutraceuticals and herbal segments.
Industry is ready for reaching next normal for growth. There are three areas in particular, which will be most important for the nutraceutical industry in near future. The e-commerce revolution (that is almost on the verge of explosion after COVID 19), growth of telemedicine and robotics and automation deployment by large scale industries, are those three factors which will prevail with the new normal after COVID 19.
The ability to buffer and absorb the shock; and be more enterprising and better than competition, shall determine survival and long term progression. The uncertainty posed due to pandemic has necessitated resiliency in all forms of business, with equal important as cost, efficiency and strategic planning.
Investors in the nutraceutical industry would surely look for the factorial of resilience in balance sheet analysis and evaluate it before capital investments in future.
In past decade, e-commerce was featuring into sale of nutraceutical products and brands. However, with COVID 19 pandemic, the e-commerce is almost set to occupy major brick of the market pie. Early signs from China, post lock down conclusion are very promising for the e-com channel.
While overall e-com pie has expanded by less prosperous cities getting active on e-com mode of shopping, it will also present a promising trend in the nutraceutical space (due to health awareness of global population). In Italy alone, the e-com sales transactions have increased by eighty-one percent since end of February 2020.
The numbers of telemedicine are increasing phenomenally too. A ‘new normal’ is setting rapidly for the nutraceutical industry. Integration of telemedicine practices with Nutraceutical industry is need of the hour. The largest telemedicine operator in Europe has reported almost two hundred percent increase in registrations.
Though this trend is more specific to general drugs and medicine, the same marketing route is applicable for nutraceuticals as well. With a societal need of reduced commuting, patients would resort more to preventive therapies and use of nutraceuticals.
Functional foods are another area of great promise in the times ahead. The most popular concept of ‘food as medicine’ should gather momentum, and thus help nutraceuticals which find origin from foods. Global organizations on societal welfare and health, may push reforms for navigating future plausible pandemic situations. Nutraceuticals find a great space in such welfare discussions and forum of Worldwide importance.
Nutraceuticals Industry will definitely face tail winds from the ‘new normal’ after COVID 19 in India. It is expected that, India nutraceutical industry will grow from current size of USD 4.5 billion to USD 5.7 billion, by the year 2023.
Regulatory Scenario
India has a strategic advantage in the nutraceutical sector over its international competitors. The traditional knowledge does provide an edge over competition. The advantage along with higher consumer awareness and incline for healthy foods has raised hope in the industry for the times to come.
The challenge resides with the regulatory oversight of the nutraceutical products. What is essential is harmonisation of regulatory process in the international and Indian diaspora. This is at times the most invincible challenge faced by the industry incumbents in India. A specific nutraceutical product ready for exports from India, may face a radically different regulatory classification in the country of target market.
In such a scenario a completely different set of data and documents will be required for the other country, necessitating massive data generation exercise and prohibitive burden of cost.
Regulations pertaining to health claims also present a challenging dynamics in India. For example, Indian regulations does not allow implicit terms on disease prevention, however permit only helping conditions clause. On the other hand, international regulations do permit outright treatment claims, for example, Canadian regulations.
Such differential approach creates excessive burden on the industry value chain. At present, the ASEAN countries are working towards systematic harmonisation of regulations in the focus group.
Further, a near to unsurmountable challenge in front of industry is commoditisation of herbal active ingredients. Heavy imports from China at ‘threat’ pricing is driving market to low price arena, thus diminishing attractiveness of the industry. It is imperative now for the Indian agri sector (post COVID 19) to preferentially take up herbal farming for the premium value products with consistent & superior quality, thus building a ‘moat’ around Indian nutraceutical industry.
It will be possible that industry incumbents may find new and long-term ways to collaborate, prompted by the regulatory and other changes that have enabled corporations to work together in order to address the current crisis. The urgency of addressing coronavirus has led to innovations in nutraceuticals, biotech, vaccine development, and the regulatory regimes that govern drug development, so that treatments can be approved and tried rapidly. The result should be more resilient, responsive, and effective health care systems.
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That foods might provide therapeutic benefits is clearly not a new concept. ...
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