The presentation deliberated on the emerging market opportunities for the local pharma industries to focus on formulations for preventive health care & maintenance. Specific proposals were made for the Hyderabad pharma cluster to set up Nutraceutical/Health Product Incubation Center for serving the local MSME industry needs.

1. 1
Hyderabad Pharma Cluster
Emerging Market Opportunities
for
Formulation Industry
(Preventive Health Care & Maintenance Sector)
Presented by
Dr. R. Sridhar
(SVEN GENETECH LIMITED, Hyderabad)
National Seminar – 9th August 2011
APITCO-PHARMEXCIL, Hyderabad

2. 2
Acknowledgment: References/Citation Sources
Consumer Health in India-Euro Monitor Market Report; Mar 2011
Winning the battle for consumer health care–Jonathan Anscombe; ATKEARNEY Publication, 2011
MNC Pharma tries to capture the $1.9 billion Indian OTC market by selling Drugs through India’s
170000 post offices-Albin Paul; November 23, 2010; blog at wordpress.com
Ayurveda Sector in India- Challenges, Potential & Way Forward- Dr. A K Krishna kumar; 25th
March 2010, Cochin
OTC market is growing a great deal in India- Nirmal Bang; June 18, 2010; stocktradereview.com
Organisation of Pharmaceutical Producers of India, 2010
Nutraceuticals- Critical supplement for building a healthy India-Ernst & Young and FICCI report,
2009
Express Pharma Online, 16-31 March, 2009
Pharma Professional, April 2009
Draft” Diagnostic Study Report, Pharmaceutical Cluster, Hyderabad” – APITCO LTD., July 2009
Spotlight on Hyderabad; CanBiotech Inc., Bio Outsourcing Asia; April 2008 Volume 1, Issue 2
Cygnus Business Consulting & Research, 2008
India Pharma 2015, Unlocking the Potential of the Indian Pharmaceuticals Market- Gautam
Kumara et al., McKinsey & Company, 2007
Emerging Market Report: Health in India- Price waterhouse Coopers; 2007
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

3. 3
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad
Demographic changes in India
*Growth of Chronic Diseases in Indian Population
Formulations for Preventive Health Care & Maintenance - An Emerging Sector
CoronaryHeart
Disease
Diabetes
Asthma
Obesity
Cancer
 New market for consumer-focused products with significant health benefits
Mass retail-based consumer goods
q
New Consumer Healthcare segment
p
Pharmacy-based pharmaceuticals
2005
2015
+26 Million
+15 Million
+7 Million
+20 Million
+0.5 Million
36 M 31 M 27 M 14 M 2 M
*Life expectancy during the period
1951-2008 has increased from
37 to 69 years!

4. 4
Formulations for Preventive Health Care & Maintenance
Major Trends:
Consumer Awareness [ Focus on Prevention
Changing Lifestyle
Increasing disposable Income & [ Increased /New Spending
Ageing Population
Booming Retail Growth
Retail Shopping Mall Space
Year 2001
Year 2012
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

5. 5
Nutraceuticals, Dietary Supplements, Functional Foods & Phytochemicals
Formulations or food products with health benefit that are taken orally to
 Supplement the diet to help prevent nutrition related disorders
 Provide structure/function support that may help prevent specific
diseases like diabetes, cancer, obesity through beneficial and proven
effects that go beyond the known nutritional effects
 Fulfill special physiological needs of the body such as like pregnancy,
lactation, sports, infancy and sedentary lifestyle
(Ernst & Young and FICCI Report, 2009)
Progress:
From addressing classical nutritional deficiencies
i Nutrition Claim/Health Claim/Risk reduction Claim (FSSA 2006 & GSR 664)
To developing desirable therapeutic applications
(Next-generation nutraceuticals developed with proven disease-fighting and immune-building
substances derived from plants, animals and minerals)
Emerging Products
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

6. 6
Nutraceuticals, functional foods and dietary supplements
Indian Market- Rs 44 billion (44,000 Cr)
(Growing at a CAGR rate 20%) (Ernst & Young Estimate 2009)
The latent market ~ Rs. 89-179 billion
(2 to 4 times more than existing)
Projection for Year 2013 Rs 90 billion
Market Potential
Food Products & Supplements *
(Vitamins, Minerals, Meal replacers, Artificial Sweeteners, Antioxidants)
Protein Powder
Sports Products
Clinical Products (ORS)
* Major Pharma players dominate this segment (Mostly confined to prescription market)
Companies like Amway India and Herbalife employ Direct Multi-Level Marketing
Rs. 1379 Cr
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

7. 7
Formulation Products – *FMHG Segment (Health Foods/Fast Moving Health Goods)
Calcium & Other Mineral Supplements
Vitamins; Co-Enzyme Q10
Probiotic Supplements; Protein Powder; Amino acid supplements
Glucose Powder; Glucosamine
Tonics and Bottled Nutritive Drinks
Fish Oils; Omega-3-6-9 fatty acids
Eye Health Supplements
Echinacea; Ginkgo Biloba; Ginseng; St.John's Wort;
Chyawanprash; Isoflavones; Garlic
Digestive Remedies
Meal Replacement; Weight management Supplements
Sports Nutrition
Protinex
(Dumex)
B.Protein
(British
Biologicals)
Nutrilite
(Amway)
GRD
(Zydus)
Digene,
Fastmelt
(Abbott)
Pepflux
Reconia,
Revital
(Ranbaxy)
Glucon-D
(Heinz)
Glucose D
(Dabur)
Benefiber
(Novartis)
Pudin Hara
Lemon Fizz;
Hingoli
antiflatulent
(Dabur)
Electral
(FDC)
Shapeworks
(Herbalife)
Positrim
(Amway)
Sugar Free
(Zydus Cadila)
Coach Formula
(Plethico)
* High growth segment of OTC products
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

8. Formulation Products – FMHG Segment (Catering to Nutrition Needs*)
*Enhancement *Condition Specific *Foundation
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

9. 9
Market Players – Nutra Formulations & Ingredients
Leading Companies across Indian Market Sectors
Abott lab Amway British Biologicals Cadila
Dabur Dr Reddy’s Dumex Elder
Emami Fourrts Fresinius kabi Johnson & Johnson
GSK Heinz Mission Vivacare Nestle
Novartis Plethico Pharmaceuticals Parrys Nutraceutical
Ranbaxy Raptakos Sami lab Scortis
Sabinsa Corporation Venky’s Zydus
Local Representation – Andhra Pradesh
Aptuit Laurus Deccan Health Care Divis Labs
Dr Reddys Herba Life Laila Impex
Xena Bioherbals
Indian Immunologicals (Veterinary)
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

10. 10
FSSAI
Authority for Nutraceuticals, functional foods, dietetic and other similar
products.
Responsible for framing and regulating standards for nutraceuticals
These standards include specifications for ingredients, contaminants, pesticide
residue, biological hazards, labels and others.
The Indian Food Safety and Standard Act (FSSA)
Came into enforcement in 2006; enforced through State Commissioners of Food
Safety and local level officials
FSSA 2006- chapter IV
Article 22 of the Act addresses the regulatory needs of nutraceutical,
functional food & dietary supplements for manufacturing, selling/
distributing or importing these products.
Articles 23 & 24 address the packaging and labeling of food and advertisement
restrictions.
Regulatory Body – Food Safety and Standards Authority of India
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

11. 11
Strength Weakness Opportunities Threats
OTC &
Prescription
mode of delivery
Low investments in R&D;
Less Foreign Tie-Ups;
Un established brands;
Lack of credibility
Increasing health
consciousness;
Increased incomes;
Fast changing life styles
Competition from MNCs
with state-of-the-art
technologies; New entries
of major pharmaceutical
companies
Traditional knowledge/
practices; Can be
delivered in evidence
based medicinal forms
Ingredient imports;
Poor quality
New innovative
therapeutic products
Conflicting results about
health benefits (Affect
the segment sales)
High price of branded
products
*Incredible
export potential
Infrastructure &
Competencies:
R&D Centers
Manufacturing Sites
Validation Skills
IPR Protection
Regulatory framework
not yet implemented
(Requires necessary
implementation so that
manufacturer of
nutraceuticals complies
with the international
safety and quality
standards)
Extensive sales channels &
booming retail growth
Advertising expenses
Indian Consulting Pattern
During Illness !
Doctor:
Pharmacist:
Self medication:
Other
Non-tariff barriers
e.g.,
Standards;
Specific Limitations on
Trade; Customs &
Administrative Entry
Procedures
Indian Nutraceutical Industry – SWOT Analysis
* $75 billion Market potential for nutraceutical exports to the US and European markets by 2013
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

12. 12
Global Scenario - New/Emerging Technologies
Micro Encapsulation of Nutraceutical Ingredients
(Incorporation of bioactive compounds–such as vitamins, probiotics, peptides, and antioxidants
etc. into food systems provide a simple way to develop novel functional foods that may have
physiological benefits or reduce the risks of diseases)
Patented examples
Ultrasome-Q10TM Herbamed
(A new type of lipid particle; a hybrid between liposomes and oil in water emulsions
Lycotec technology
(Lycosomes -for oral delivery of bioactive molecules; protection of bioactive molecules in the GI
tract; Increase in bioavailability of bioactive molecules; Targeted liver delivery)
BioEnvelop™ edible gel technology
(A platform for transforming active ingredients into a gel format)
Bio-tract™ Nutraceutix
[For controlled delivery systems; A gel-like matrix protects sensitive microorganisms
(a 12 billion count) from stomach acids, directing them to the intestines where they
are most effective]
Stabilization of Ingredients
[e.g., Risolubles – (Nutracea company; Nutrient rich rice bran products - antioxidants; vitamins; lipid
ingredients)]
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

13. 13
Nutraceutical Delivery Systems
Newer modes of delivery – e.g., soft chews, quick dissolving film strips….
 Film Strips
Film strips for low-dose vitamins, minerals & herbal ingredients. Portable,
convenient, easy to use and tasty, quick-dissolving film strips (for consumers unable
to swallow pills); Breath Strips (Listerine-Pfizer)
 Chocolate embedding compatible bioactive compounds
 Ice creams !
e.g., ‘ReCharge’ (a lactoferrin-rich ice cream) developed by LactoPharma &
Fonterra (NZ) for cancer treatment. Lactoferrin is a protein found in milk
that possesses the power to impede tumor growth and improve intestinal immune
response.
Packaging Trends
“Doy-Pack” stand-up pouch
(very popular in Japan for a range of liquid and dry foods)
“Cartocan” composite paper can
(becoming more popular for vending machine beverages)
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

14. 14
Regional Scenario - Pharma Cluster, Hyderabad
Scope for Expansion & Diversification into Nutraceutical Segment
Health Products for people with various needs
*Aim at developing effectively targeted, packaged and promoted products and
deliver what has been promised to a large clientele
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

15. 15
Product Development & Differentiation:
 Focus on technology absorption, adaptation and innovation
 Rank and choose the new top products and/or top product features by conducting
SWOT analysis
 Choose ingredients with better functionality/effectiveness
New/better sources of minerals – e.g., for high absorption rate and increased
utilization by the body
 Design & apply new delivery systems with improved functionality ... in a form that
tastes good, feels good, is stable & bio-available
Nanotechnology application - Enhanced solubility; improved bio-availability;
facilitating controlled release and protecting the stability of micro nutrients
Lipid emulsions - Improvement of the oral bioavailability (lipid emulsifiers –
phospholipid; galactolipid)
Glyconutrients- Biologically active polysaccharide technologies
Nutritional granulates – for preparation of tablets comprising of desirable active
ingredients
Vegetarian Capsules; Pellets; Oil Powders……..
Strategies/Proposals for Formulation Units
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

16. 16
Promotion
 Identify a potential consumer market that's accessible to the unit.
 Reach the untapped rural market (propagate even through NGOs, self help groups
etc.)
 Increase awareness of the benefits of nutraceuticals through advertising and
physician education (Medical detailing)
 Focus on mass marketing, distribution expansion and line extension.
 Tie up with retail outlets (e.g.,Bharti Walmart, Reliance Fresh, Metro Cash & Carry,
Heritage….)
 Establish Foreign Tie ups (Local leads e.g., Dr Reddys; Laila Impex…); Enter in to
various global strategic alliances for technology and marketing
Summary
 Simulate international products of good quality; Import technology wherever necessary
 Make generic equivalents of life saving/supporting products (eg., Nestle, Fresinius...)
 Identify and Target health needs that are region/tradition specific
 Build a multi-disciplined scientific team with adequate resource funding
 Deliver predictable, efficacious, well-defined and safe bioactive components
 Achieve higher investment rewards via patented and innovative products
Strategies/Proposals for Formulation Units
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

17. 17
Objective: Develop a local nutraceutical hub at Hyderabad catering to the regional
needs
Scheme: Fill in the critical gaps in the Nutraceutical sector especially related to
standardization, quality assurance/control, productivity, marketing, infrastructure and
capacity building through a cluster based approach.
BDS Areas
Technology; Quality; Market access; Energy; Finance; Raw materials; Safety
Expected Takeaways:
Additional Business Generation (Higher turnover)
Access to Credit (Collective borrowing possibility)
Cost Savings (Shared expenses on common facilities)
Better Bargaining Power (for buying raw material and selling finished products)
Enhancement of Productivity and Quality
Market Development (Creating new markets and expanding existing ones)
Nutraceutical Cluster – A Specific Proposal for the Region
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

18. 18
Supports R&D – Innovation Research and Product Development skills
 Links effectively with
o Premier Indian Institutions/Research Centers - IICT; NIN; IIL; ICRISAT; CFTRI; PIC-
DST, India for promoting innovation among MSME clusters; collaboration in R&D; development
of new products, processes, technologies and services
o FNIC-USDA for dissemination of food and human nutrition information
o OPPI- for promotion of responsible self-medication (OPPI-OTC committee is aiming for
accessibility of household OTC remedies and increasing the awareness of the importance of
responsible self-medication with the general public and the Government).
 Prioritizes local health problems alongside the international ones
 Compiles database of ingredient manufacturers/supplier sources along with the list of
acceptable nutra/health ingredients
 Guides on preparation of Common Technical Documents; Safety & Efficacy Reports/
Monographs; Dietary Supplement Fact Sheets
 Encourages Nutra ingredient manufacturing (Production of Bulk Nutrients)
(Facilitates to create material bank for essential and regular raw materials to address the costly, and
any poor quality/untimely delivery of raw material/excipient imports.
Raw material linkages – Ensures timely supply of raw materials and eases custom clearance by
agreement with state product federations/Airport authority… )
Nutraceutical Cluster – Functional Expectations
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

19. 19
Supports Quality Testing- Standardization of Quality
(Helps in designing and implementing a scientific and organizational quality system)
e.g., Availing USP services (USP Convention- Separate Advisory Panel on
Nutraceuticals for developing safety standards for the entire range of dietary
supplements and nutraceuticals that are currently not under the strict
regulatory classification of either drugs or foods)
Marketing Awareness- Facilitates Marketing Consultancy Service Providers
(for advice on identifying the product, packing, launch areas and also in marketing)
Focus Areas:
New retailing programs;
Media and Government focus;
New marketing and communication methods;
Foreign Tie-ups
Nutraceutical Cluster –Functional Expectations
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

20. 20
Conclusion
Specific Proposal to Hyderabad Pharma Cluster:
To Set up
A Nutraceutical/Health Product Incubation Center with
Common Infrastructure – for R&D, Pilot testing, Skill up-gradation etc.
Analytical Centers - for analytical method development; content analysis;
quick analysis and validation of Nutraceutical/Health products.
Library - for paper & electronic/web based information; facilitation of
information from proprietary/private sources at affordable cost.
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar, SGL, Hyderabad

21. 21
THANK YOU
9th Aug 2011- National Seminar-Sponsored by WORLD BANK,DFID & SIDBI; Undertaken by APITCO Dr. R.Sridhar SGL, Hyderabad
Dr. R. Sridhar
Sr. Vice President – FR&D
SVEN GENETECH LIMITED
Plot No. 107, I.D.A., Phase-II, Cherlapally
R.R.Dist., Hyderabad – 500 051
Email: dr.r.sridhar@gmail.com
Mobile Phone: (0) 944 188 7098

22. 22
Foods for special dietary uses, functional food or nutraceutical/dietary supplements:
(a) Foods which are specially processed or formulated in order to satisfy particular dietary
requirements which exist because of a particular physiological or physical condition and which are
processed as such wherein the composition of these foodstuffs must differ significantly from the
ordinary food of comparable nature, if such ordinary food exists one or more of the following
ingredients namely:
(i) Plants or botanicals in the form of powder, concentrates or extracts in water, ethyl alcohol, single or in
combinations
(ii) Minerals, vitamins or proteins (amounts not exceeding recommended daily allowance for Indians) or
enzymes
(iii) Substances from animal origin
(iv) A dietary substance being used by human beings to supplement the diet by increasing the total dietary
intake.
(b) (i) a product that is labeled as “food for special dietary uses” functional food or nutraceuticals
dietary supplements which is not represented for use as conventional food and whereby such
products may be formulated in the form of powders, granules, tablets, capsules, liquids, jelly and
other dosage forms but not parenterals, and are meant for oral administration;
(ii) such product does not include a drug as defined in clause (b) and ayurvedic, sidha and unani drugs
as defined in clauses (a) and (h) of section 3 of the Drugs and Cosmetics Act, 1940 and rules made
there under;
(iii) does not claim to cure or mitigate any specific disease, disorder or condition (except for certain
health benefit or such promotion claims) as may be permitted by the regulations made under this
Act.
FSSA- Definitions
9th Aug 2011- National Seminar - APITCO Dr. R.Sridhar SVEN GENETECH LTD