Functional Foods and Health Benefits


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An analysis of functional foods and health benefits - Where the future lies: growth and opportunities for market players globally - Health economics dictate a shift in spending: away from treating and towards predicting, diagnosing and monitoring

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Functional Foods and Health Benefits

  1. 1. Health Benefits: Looking at the Next Big Functional Foods
  2. 2. Highlights Industry Backdrop History Predicting the Future Top 5 Functional Ingredients Source: Frost & Sullivan. Geography Scientific Maths
  3. 3. Nutraceuticals – Industry Backdrop
  4. 4. Industry Backdrop: Population Growth Global Population 2010 6.8 billion 2050 9 billion Share of Population from 1950 – 2010 & Population Growth in the 2000-2010 Decade
  5. 5. Industry Backdrop: Industry Challenges <ul><li>Production efficiency </li></ul><ul><li>Sustainability </li></ul><ul><li>Quality & Safety </li></ul><ul><li>Nutrition & Health </li></ul>Dietary Supplements Functional Beverages Functional Foods Nutraceuticals + + Source: Frost & Sullivan.
  6. 6. Industry Backdrop: Trends Plentiful Choice Over-Eating Food consumption profiling Indulgence Junk Foods Balanced Diet Healthy Eating Nutrigenomics Personalised Nutrition 1960s 2020s 2000s 1980s Obesity Diabetes CVD Source: Frost & Sullivan.
  7. 7. Nutraceuticals – Predicting the Future
  8. 8. Future Nutraceuticals History of health & consumer trends Sourcing, Opportunities & Socio-political Scenario Market Size: Current & Potential Revenue Scientific Profile of Ingredients Source: Frost & Sullivan. History Geography Science Maths
  9. 9. History: Health Trends Cardio-Vascular Disease (CVD) Diabetes Obesity Elderly Dementia Osteoporosis Major Health Trends Nutraceuticals Source: Frost & Sullivan.
  10. 10. Health Trends: CVD WHO estimates that about 24 million people annually will die globally due to CVD by 2030 <ul><li>78% CVD deaths from low- and middle-income countries </li></ul><ul><li>2010 – CVD is estimated to be the leading cause of death in developing countries. </li></ul><ul><li>2006 – CVD costs the EU healthcare system ~€110 billion (10% of the total healthcare expenditure) </li></ul><ul><li>2006 – Germany and UK had the highest healthcare cost per capita in EU (per annum) </li></ul><ul><li>1996-2006 – In the US death rates from CVD declined 29.2% and the actual number of deaths declined 12.9% </li></ul>Key Findings & Trends Source: WHO Source: WHO, British Heart Foundation, American Heart Association Source: WHO Deaths (Million People) 2003 2005 2030
  11. 11. Health Trends: Obesity <ul><li>Prevalent in both children and adults of developing and developed countries </li></ul><ul><li>No longer limited to high-income countries – on the rise in low- and middle-income countries, particularly urban areas </li></ul><ul><li>2005 – 1.6 billion overweight; 400 million obese </li></ul><ul><li>2005 – 20 million children globally under the age of 5 years were overweight </li></ul><ul><li>Obesity is responsible for at least 2–8% of health costs and 10–13% of deaths in different parts of the EU Region </li></ul>WHO estimate that 2.3 billion adults will be overweight and about 700 million will be obese by 2015 Key Findings & Trends Million obese adults 2005 2015 Year Source: WHO Source: WHO
  12. 12. Health Trends: Diabetes <ul><li>1995 – 4% adults globally </li></ul><ul><li>2025 – 5.4% adults globally </li></ul><ul><li>Individuals suffering from diabetes: </li></ul><ul><ul><ul><li>Rising 42% in developed countries, from 51 to 72 million </li></ul></ul></ul><ul><ul><ul><li>Rising 170 % in developing countries, from 84 to 228 million </li></ul></ul></ul><ul><li>Proportions of the diabetic population: </li></ul><ul><ul><ul><li>Developing countries projected to be younger (age between 45 & 64) </li></ul></ul></ul><ul><ul><ul><li>Developed countries projected to be older (age 65) </li></ul></ul></ul>The global health expenditure on diabetes is expected to be at least $376 billion in 2010 and $490 billion by 2030. Key Findings & Trends Source: King H, et al., Global burden of diabetes, Diabetes Care. 1998
  13. 13. Health Trends: Osteoporosis (The Silent Disease) <ul><li>Osteoporosis is the cause of more than 8.9 million hip, wrist and spinal fractures worldwide each year </li></ul><ul><li>Is second only to cardiovascular disease as a global healthcare problem. </li></ul><ul><li>Global numbers of hip fractures: </li></ul><ul><ul><li>1990 – 1.66 million </li></ul></ul><ul><ul><li>2050 – 6.26 million </li></ul></ul><ul><li>Estimated annual direct cost of treating osteoporosis fractures in the USA, Canada and Europe alone is ~USD48 billion </li></ul><ul><li>EU and USA have the highest risk of hip fractures; however, 1 in 4 hip fractures now occur in Asia and Latin America. This is set to increase to 1 in 2 by 2050 </li></ul>IOF predicts that the worldwide cost burden of osteoporosis (for all ages) will increase to USD131.5 billion by 2050 Key Findings & Trends Source; WHO and Cooper C, et al. (1992) Hip fractures in the elderly: a world-wide projection. Million people 1990 2050 Year
  14. 14. Health Trends: Dementia <ul><li>With advanced age the risk of developing dementia increases – the prevalence roughly doubling every five years over the age of 65 </li></ul><ul><li>Predicted increase in the numbers of people with dementia: </li></ul><ul><ul><li>40% rise in Europe </li></ul></ul><ul><ul><li>63% rise in North America </li></ul></ul><ul><ul><li>77% rise in Latin American </li></ul></ul><ul><ul><li>89% rise in developed Asia Pacific </li></ul></ul><ul><li>Globally the annual economic cost of dementia estimated at $315 billion </li></ul><ul><li>The total annual costs per person with dementia; $1,521 in a low income countries and up to $17,964 in high income countries. </li></ul>Alzheimer’s Disease Dementia with Lewy bodies Vascular Dementia Frontotemporal Dementia Common Dementia-related underlying Brain Pathologies It is estimated that 35.6 million people would have dementia in 2010, nearly doubling every 20 years to 65.7 million in 2030 and 115.4 million in 2050. Key Findings & Trends Source: World Alzheimer Report, 2009 Million people 2010 2050 Year 2030
  15. 15. <ul><li>In 2000, >5% (606 million) of the global population was aged 60+. By 2050 this will be more than 21% (2 billion). </li></ul><ul><li>75% of people aged 60+ have one chronic condition, while 50% have two or more chronic conditions. </li></ul><ul><li>Health economics dictate a shift in spending – away from treating and towards predicting, diagnosing and monitoring </li></ul>Health Trends: Aging Population People aged 60+ utilise 3-5 times more healthcare services than younger people Chronic diseases account for more than 60% of all healthcare spending Million people Population aged 60+ (world) Global mortality from chronic disease
  16. 16. History: Consumer Trends Source: Frost & Sullivan. <ul><li>Hectic Lifestyle </li></ul><ul><li>Stress </li></ul><ul><li>Dual income families </li></ul><ul><li>Increasing life expectancy (aging population) </li></ul><ul><li>Look & feel young </li></ul><ul><li>High consumer awareness (trust in science) </li></ul><ul><li>Food quality & safety </li></ul>convenience / fast foods increasing incidence of lifestyle disorders functional / health foods, natural foods, synthetic additive free foods Developments Trends Demand Format
  17. 17. Geographic Analysis Source: Frost & Sullivan. US Europe Asia / ROW Political Little or no political intervention in functioning of industry Little or no political intervention in functioning of industry; GM remains an issue Little or no political intervention in functioning of industry Economic Recessionary trend in the economy is pushing consumption down temporarily Recessionary trend in the economy is pushing consumption down temporarily Emerging affluence of population leading to greater consumption of value added foods Social Greater acceptance of new products, increasing focus on health & wellness Reluctance to adopt GM ingredients, increasing focus on health & wellness Low awareness ; Mimics western food pattern; strong traditional practices of prevention & cure Legislative DSHEA provisions are implemented by FDA. Not very strict Strict EFSA control over label claims and approvals FOSHU in Japan is a tool to increase functional food popularity in the market, rather than being a restraint.
  18. 18. Scientific Analysis: Health Benefits of Ingredients omega-3, phytosterols, fibre, antioxidants herbal extracts, fibre, protein, fatty acids omega-3, antioxidants, amino acids CVD Weight Management Cognitive probiotics, fibre, protein, vitamins & minerals, omega-3, antioxidants Elderly minerals, vitamins, omega-3, protein, amino acids, antioxidants, Botanicals Bone & joint Source: Frost & Sullivan.
  19. 19. Scientific Analysis: Science & Technology of Ingredients Comparison of Number of Research Papers for Different Ingredients Source: Frost & Sullivan.
  20. 20. Scientific Analysis: Ingredient Profile Future Nutraceutical Ingredients Ranking Top 10 Parameters Used to Assess Future Nutraceutical Ingredients Source: Frost & Sullivan. Ingredients Omega 3 Probiotics Fibre / Prebiotics Antioxidants Proteins / Amino acids Vitamins & Minerals Botanicals Ranking on a Scale of 1- 10 6.9 6.4 5.6 6.8 7.0 7.1 6.4 1. Research Profile 6. New Product Introduction 2. Health Claim - Regulatory 7. Consumer Marketing 3. Health Positioning 8. Current Market Size 4. Application Profile 9. Sustainability 5. Consumer Awareness 10. Market Growth rate
  21. 21. <ul><li>In almost all countries worldwide, per capita healthcare spending is rising faster than per capita income. </li></ul><ul><li>No country can spend an ever-rising share of its output on health care, indefinitely. Spending growth must eventually fall in line with growth in per capita income. </li></ul>Unsustainable Levels!!! Compare with Defence spending… Maths: Healthcare spending Unsustainable Healthcare Spending- Drives Preventive Medicine Source: Frost & Sullivan.
  22. 22. Maths: Global Nutraceuticals Industry Globally the market is growing at 7 – 22% Global market to be more that USD 170 billion by 2013 Source: Frost & Sullivan. USA, 36% Japan, 22% Others, 9% Rest of Asia, 7% France, 6% Italy, 3% Rest of EU 6% Germany, 5% Switzerland, 3% UK, 2% India, 1%
  23. 23. Nutraceuticals – Top 5 Functional Ingredients
  24. 24. Top 5 Functional Ingredients Source: Frost & Sullivan. Ingredients Why is it Hot? Omega-3 Positioned for key diseases / disorders that are on the increase Probiotics Most acceptable application format (yogurt); Positioned for digestive health disorders that form the basis for improving resistance to diseases; Best suited for the elderly Natural Vitamin E (Antioxidants) Most well established antioxidant; Natural form is the “in” trend Soy Protein (Proteins & Amino acids) One of the best substitutes for dairy protein (with increasing incidence of lactose intolerance); Protein quality equivalent to dairy proteins; Constantly improving flavour profile Phytosterols (Botanicals) Well positioned scientifically & commercially in the area of heart disease
  25. 25. Top 5 Functional Ingredients: Omega-3 Ingredients <ul><li>Well-positioned for cognitive & heart health </li></ul><ul><li>New research areas include immune & bone & joint health </li></ul><ul><li>Most important challenge is the flavour profile that decelerates penetration into many food applications </li></ul><ul><li>Marine Oil Key Players: Pronova BioPharma ASA, EPAX AS, ONC; Algal Oil Key Player: Martek & Lonza </li></ul><ul><li>Sources under development include: flax, soy </li></ul>Volume Market Share by Application, (2009) Source: Frost & Sullivan. Revenue: $323.0 Million (CAGR – 10.2%)
  26. 26. Top 5 Functional Ingredients: Probiotics <ul><li>Well-positioned for digestive & immune health </li></ul><ul><li>New research areas include oral care & women health </li></ul><ul><li>Most important challenge is stability issues that prevent penetration inot application other than dietary supplement & dairy </li></ul><ul><li>Key players: Chr.Hansen, Danisco, Probi, BioGaia, DSM, Yakult </li></ul><ul><li>Other key service providers / stake holders: Bifodan, Cell Biotech, Campina, Nestle </li></ul>Other applications include medical and personal care probiotics Market Share by Application, (2009) Source: Frost & Sullivan. Revenue: $102.5 Million
  27. 27. Top 5 Functional Ingredients: Natural Vitamin E <ul><li>Vitamin E is classified as an antioxidant </li></ul><ul><li>There are eight different varieties of this product including tocopherols, tocotrienols and tocopherol phosphates; In its natural form, vitamin E is designated d-, as in-d-alpha-tocopherol, while its synthetic forms are designated dl-, as in dl-alpha-tocopherol. </li></ul><ul><li>Applications of natural Vitamin E include food & beverages, cosmetics & dietary supplements </li></ul><ul><li>Natural Vitamin E has been proved to have higher efficacy than synthetic alternatives. </li></ul><ul><li>Key players/Stake Holders: DSM, Cognis, ADM, Shenjian Medical </li></ul>Unit Consumption by Europe and Selected Market Share by Application, Metric Tons (2009) Source: Frost & Sullivan. Revenue: $26.5 Million
  28. 28. Functional Ingredients at Frost & Sullivan Frost & Sullivan Food & Beverage Ingredients Practice Nutrition & Health: Functional Foods & Beverages; Dietary Supplements PUFA, Probiotics, Prebiotics, Antioxidants, Other Condition Specific Health Ingredients Food Additives: Bakery, Dairy, Confectionery, Beverages Antimicrobial & Antioxidant Preservatives, Flavours & Flavour Enhancers, Emulsifiers, Enzymes, Sweeteners, Others Animal Nutrition: Poultry, Swine, Ruminants, Pets, Aquaculture Nutritional Ingredients, Shelf-life stabilisers, Sensory Ingredients, Others Consumer Needs & Awareness Technology & Innovation Emerging Markets: Products, Applications & Geographies MARKETS COVERED RESEARCH THEMES Regulatory Affairs & Legislative Developments Food Security, Safety & Sustainability
  29. 29. Where the future lies: Growth and Opportunities + = Source: Frost & Sullivan. History Geography Science Maths
  30. 30. Frost & Sullivan - Information
  31. 31. Health Ingredients: Our Coverage Available Topics Omega 3 ingredients Heart Health Probiotics Digestive Health Prebiotics Bone & joint health Fibre Eye Health Dairy Proteins Weight Management Solution Plant Proteins Infant Nutrition Amino Acids Enteral Nutrition Green Tea Extracts Functional Beverages Natural Extracts Co-enzyme Q10 Natural Colours CLA Artificial sweeteners Food Starch Enzymes Flavours Emulsifiers   Upcoming Topics Immune Health Women Health Anti-hypertensive Health Cognitive Health   Sports & Fitness Nutrition
  32. 32. Health Ingredients: Our Coverage **Geographies Covered: North America, Europe, South Africa, APAC, South America Planned Topics (2011) <ul><li>Salt Reduction </li></ul><ul><li>Collagen Peptide </li></ul><ul><li>Natural Sweeteners </li></ul><ul><li>Food Fibers (update) </li></ul><ul><li>Heart health (update) </li></ul><ul><li>Sustainable ingredients </li></ul><ul><li>Ingredients for enteral nutrition </li></ul><ul><li>Gluten-free solutions </li></ul><ul><li>Trans-fat free solutions </li></ul><ul><li>Emerging Flavours </li></ul><ul><li>Hydrocolloids </li></ul><ul><li>GMO </li></ul>
  33. 33. What Makes Us Unique <ul><li>Exclusively Focused on Growth </li></ul><ul><ul><li>Global thought leader exclusively focused on addressing client growth strategies and plans – Team actively engaged in researching and developing of growth models that enable clients to achieve aggressive growth objectives. </li></ul></ul><ul><li>Industry Breadth </li></ul><ul><ul><li>Cover the broad spectrum of industries and technologies to provide clients with the ability to look outside the box and discover new and innovative ideas. </li></ul></ul><ul><li>Global Perspective </li></ul><ul><ul><li>32 global offices ensure that clients receive a global coverage/perspective based on regional expertise. </li></ul></ul><ul><li>360 o Perspective </li></ul><ul><ul><li>Proprietary T.E.A.M. TM Methodology integrates all 6 critical research methodologies to significantly enhance the accuracy of decision making and lower the risk of implementing growth strategies. </li></ul></ul><ul><li>Growth Monitoring </li></ul><ul><ul><li>Continuously monitor changing technology, markets and economics and proactively address clients growth initiatives and position. </li></ul></ul><ul><li>Trusted Partner </li></ul><ul><ul><li>Working closely with client Growth Teams – helping them generate new growth initiatives and leverage all of Frost & Sullivan assets to accelerate their growth. </li></ul></ul>
  34. 34. T.E.A.M. Methodology <ul><li>Frost & Sullivan’s proprietary T.E.A.M. methodology , ensures that clients have complete “360 Degree Perspective” from which to drive decision-making. T echnical, E conometric, A pplication, and M arket information ensures that clients have a comprehensive view of industries, markets and technology. </li></ul>T echnical Real-time intelligence on technology, including emerging technologies, new R&D breakthroughs, technology forecasting, impact analysis, groundbreaking research, and licensing opportunities. E conometric In-depth qualitative and quantitative research focused on timely and critical global, regional, and country specific trends, including the political, demographic, and socioeconomic landscapes. A pplication Insightful strategies, networking opportunities, and best practices that can be applied for enhanced market growth; interactions between the client, peers, and Frost & Sullivan representatives that result in added value and effectiveness. M arket Global and regional market analysis, including drivers and restraints, market trends, regulatory changes, competitive insights, growth forecasts, industry challenges, strategic recommendations, and end-user perspectives.
  35. 35. Global Perspective <ul><li>1,700 staff across every major market worldwide </li></ul><ul><li>Over 10,000 clients worldwide from emerging to global 1000 companies </li></ul>
  36. 36. For Additional Information Chiara Carella Head of Communications +44 (0) 2073438314 [email_address]