Investing in the ability to claim that a food or drink product has health benefits is a “worthwhile” process, despite costs of over US$10m, according to research.
A study by Business Insights, published today (23 April) claims that, as consumers become more concerned and knowledgeable about their health, many are looking to self-medicate.
As a result, the analysts believe that large food and drink players are focusing on the potential of the nutraceuticals market, triggering an increase in investment and takeovers – a trend the firm believes will continue to accelerate in the next five years.
This comes despite an increase in costs for clinical research needed to substantiate health claims made on both new and existing ingredients.
“The fact that we’re seeing so much growth in the market, despite the increased costs, illustrates the scope of potential,” Business Insights analyst Dr Cheryl Barton said.
Food and drinks manufacturers such as Danone and Nestlé have invested heavily behind bringing novel nutraceutical products to the health and wellness category.
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By GlobalDataHowever, with consumer healthcare divisions of some major healthcare companies also investing in nutraceuticals, most notably McNeil’s Benecol products, competition is high, Business Insight noted.
“Despite the limitations caused by the tightened regulation and cost, there is massive potential for growth. In this rapidly expanding market, companies will need to differentiate themselves with products that offer an immediate health benefit in days rather than months, to keep consumers coming back for more,” Barton said.
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