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Translating industry trends for health products to natural ingredients

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Objectives

Learn how to recognise industry trends

Learn to determine results of these trends

Learn how to translate trends into opportunities and threats and O&T into action

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Industry trends

Regulatory developments

Economic developments

Market developments

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Regulatory developments

Harmonisation of EU herbal medicine regulations

In some countries (UK): stricter requirements than before

In many countries: redeveloping products as food supplements or medical devices more innovation but also competition and substitution

Everywhere: Industry consolidation

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Regulatory developments (2)

Novel Food legislation

Barrier to introduce novel food (ingredients), including for food supplements!

Result: restricts innovation

Future: possible changes legislation to make imports of new food products easier

Result: (if changes are adopted) more options to innovate

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Regulatory developments (3)

Strict claim legislation food products and supplements (nutrition and health claims)

Delay in accepting health claims botanicals: Uncertainty!

Currently: 80% health claims rejected

Result: companies need to develop new strategies for applications

Result: careful in claims made for food supplements

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Economic developments

Industry consolidation, result from:

Economic uncertainty

Regulatory changes: identify and document all ingredients along the supply chain

Larger players: more market power

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Economic developments (2)

Industry shift:

Production from West to East:

West: focus on high-value – low labour input - organic

Extraction outside of EU: processing increasingly at source

WHO regulation have leveled playing field

Exporters: less willing to export raw materials

Governments limit export products without value addition

Some EU companies have large vested interests in extraction facilities

Others are open to DC suppliers of extracts, but new responsibilities – Safety in all its aspects

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Economic developments (3)

Respond to risks:

Fast-changing sector – low margins

Decrease stocks

Changing raw material prices

Supply security

Going to the source – ensuring traceability

Towards sustainability of supplies – but also in pricing?

Natural resource management and use

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Economic developments (4)

Shift in Pharmacological research and development to outside Europe

In Europe:

Rising R&D costs

Regulatory requirements

Complex research areas

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Market developments

Diversification product range

Supply different segments

Active at different levels value chain

Demand specifications of ingredients to comply across segments

Growth of direct sourcing, increasing demand for:

Transparency

Supply security

Storytelling

Value addition opportunities for DC suppliers

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Market developments (2)

Increasing MAPs and extracts industries in Eastern Europe

Market opportunities DC suppliers

OR competitors for DC suppliers (temperate species)

Increased world demand European (German/Swiss) herbal medicine and supplements

Export to USA, Russia, Japan, China etc.

Some EU manufacturers and traders less dependent on EU market developments – global players

Growth of developing (Asian) markets

Strong pricing competition due to global market sharing

Alternatives and better bargaining position for suppliers

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Questions and Answers

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