’Industry efforts needed to first create Indian market’


As the nutraceutical, nutritional, functional foods and dietary supplements as well as Ayurceuticals and Sportsceuticals sectors are on growth path, the startups and SMEs are also going to play a vital role in development and growth of the sector. One of the major issues SMEs face is funds and investments as, besides banks, not many other major investors are coming forward to investment in the sector. According to a senior consultant from the sector, people are still not willing to invest money in this field due to perceived lack of ROI and doubts over risks of the sector.

Realising the plight of the sector in general, and SMEs in particular, NuFFooDS Spectrum has taken initiative to explore possibilities of finding ways of developing a proper eco-system, particularly related to finance, for NuFFooDS sector. It is talking to some industry leaders to find out the reasons for the present situation and solutions to build up funding agencies’ confidence about the sector to make them aware and promote investment for SME and manufacturing sector of nutraceuticals Industry.

As a part of its efforts, Vijay Thombre, Director, MM Activ Sci-Tech Communications, publisher of NuFFooDS Spectrum, and Milind Kokje, Editor, NuFFooDS Spectrum, talked to Sanjay Mariwala, Managing Director, OmniActive Health Technologies, who has 30 years experience in the natural ingredients industry and nutraceuticals.

‘Indian market for nutraceuticals and dietary supplements still does not exist,’ says Mariwala and cites it as one of the reasons for funding agencies’ lack of interest in this sector. If banks and funding agencies are to be attracted to the sector, market in India has to be created and expanded, he suggested. Excerpts:

How do you look at the Indian market of nutraceuticals, functional foods and dietary supplements? Market is the core of everything. Having a large core group of customers is everybody’s wish. But that large core group of customers is not present in the Indian market. Why is it not there?

Let us ask this question to ourselves. The reason why there is no market in India is because we have a market system which is extremely fragile. It’s not well organised and it’s not formed yet. It is still at a very embryonic stage. How the market is going to form, that has not yet evolved.

I think building awareness among consumers that chronic conditions require sustained treatment is essential. It is accepted partially in homeopathy and ayurveda but it does not translate across in modern medicine. I don’t know whether doctors are endorsing nutrition and nutraceuticals. What they are endorsing are food supplements, but not dietary supplements.

What is the reason?

Doctors say there is not enough clinical work in nutraceuticals that gives us confidence to say that it will work. There is not enough science in it. Even if it is there it is not accessible. These are all comments from doctors.

I don’t know which one is a real problem. But whatever it is, we need to solve that problem. Science is there. It is not reaching the doctors. This is one issue which needs to be dealt with first. But, the question is who would do it. If a private company has to do it, or do they need to have an NGO to do it. That needs investment. Which means there should be an offtake. But revenues today are really not seen in Indian market of the size and scope that can drive this efforts. We don’t have a single `300/400 crore worth brand, not even a basket of brands in dietary supplements. Even the largest companies don’t have them. In comparison, in the US market `300/400 crore company is a small company.

Though this is the challenge, I feel the problem is not that alone. The problem is what can be done to build up this core of medium between products and consumers, i.e. doctors and nutritionists. How do we approach them in an innovative way? That is where lies the answer to create the growth area.

Of course, business has to get into that. So, how do we contribute? Question here is what can we do to convince the one shop customer that nutraceuticals are good. It is not that Indians don’t have money. Our culture does not permit them to spend it. Look at our discipline of taking antibiotics. People do not complete the course prescribed by doctor. They change course in between as per their wish. Combination of medicines prescribed by doctor works in treating and preventing the relapse. But we do not treat it like that. We don’t mind a relapse after 15 days. This is our mindset. This is the same mindset we have about safety. We all are victims of it. In India we don’t think about value of life. This is the mindset in which we operate.

How can the mindset be changed?

To change the mindset, we actually need to put in a process which can help us create and build a market. The first step in my opinion needs to be to create that awareness. That awareness one company cannot do, one association cannot do because who will fund it? Without investment no results will come. I think if we can get a group together that is investing in it that will help. We need to bring in companies which are interested in creating market. So, the next step in my opinion is market awareness creation and building that shift in mindsets to look at sustaining treatment at chronic diseases.

How do we create that market awareness?

For that we need two levels of communication. One is generic and second is product specific. Obviously, product specific has to be responsibility of companies. Generic is where magazines like you come in. You need that support for generic communication. It is also the responsibility of companies to support the generic communication because if we don’t support it our market is not going to grow. How do you convince the companies to do that is a challenge. We need 10 companies that can work together to get this done.

I will share my experience of spices. Spice Board started giving the companies subsidy to go to trade shows and sell the products. But we told commerce ministry we don’t need subsidy. We will spend on our own. But, you use that money for generic promotion of Indian spices. Why people should buy Indian spices? Why people should come to India to buy spices? We said we can create Kochi as the destination that you have to visit if you are in the spice business. If you don’t visit Kochi and if you don’t talk to companies there, you have not seen anything. So, we created a campaign around this. We created an event World Spice Congress. All World Spice Congresses were held in India. It started with 100 participants, today it has 1,000 participants. So, we created an event and it made everybody in the world stand up and take note and say here are companies that are world class, they are investing money in production systems, quality systems.

How is the market for nutraceuticals in India going to evolve?

Think how do we bring doctors, nutritionists into this industry? Start promoting the sector. Money is available if you demonstrate purpose. Find the purpose, funds will come. What we should look at is how we connect to doctors and nutritionists. Scientists can talk to the doctors. We have to channelise the focus of the companies in expanding this market. How many Indian companies actually do R&D? Very few. Creating new market like this is not that difficult. You need product development, you don’t need fundamental research. You require formulation. What you require is what is available science and how do you marry it? How do we get them to see the benefits of addressing those segments where doctors come and speak in terms of what are chronic conditions that can be treated. We will have to have with us a few doctors who are willing to make that change. That is one of the changes that we need to bring about. Problems like cardiovascular once they are there they are going to be there. They are not going to go away. You have to just treat them naturally. How are we are going to bring that message out? How do companies say that they have products for some diseases? How do the doctors say that it is good treatment? We have to start with that. How do we help those companies generically sell these concepts? So, the concept should be naturals are good for chronic conditions.

Will there be support for such activity?

I talked to some companies and they are interested. Market creation is what we really need now. We need doctors supporting nutraceuticals to say that these are good products. Doctors should not say nutraceuticals are all bogus and don’t consume it. How do you stop doctors saying nutraceutical is bogus? That is needed. Prices of products is not a challenge. I think marketing, communicating and getting this message across through relevant influences is a challenge. There is need to parallely build this momentum as to why it is important to talk to doctors. Why it is important to promote nutraceuticals. Generic promotion of the category of naturals that is the platform on which doctors need to interact.

Let the dialogue begin. Let doctors stand up and say nutraceutical category is good. Doctors in India are not promoting this category. In US,
change took place when doctors started saying nutrition is good, nutraceuticals are good. The industry needs to connect government — ministry of health, food processing and department of Ayush — and ICMR. Once they are on board, then the doctors are needed. The doctors’ critique is must. Let us hear what they have to say. They would say you don’t have science. We will create science. I don’t see any difficulty in that.

If the industry can create the Indian market, huge transformation would be seen. Among various categories, sports, ayurvedic, weight loss and chronic conditions will work initially. They are needed to give focus. Ten big companies coming forward and participating in such efforts is an answer to all challenges in creating Indian market.

How funding agencies’ confidence can be built up to promote investment for SME and manufacturing sector?

Besides creating and expanding the market, the industry should also first find out that what exactly the funding agencies look for when they finance projects. Individual units must know what to present to the funding agencies while seeking investments for possible positive results. Industry should be able to give confidence to the funding agencies about the potential growth of the sector to provide them the assurance of the ROI.

What is the role of regulations in this?

Regulation is important. We need to bring about a certain discipline. Regulation will cover elements that start with claims and translates into standards of production and quality of products. One can’t make tall claims. Manufacturers need to have a very strong logic of what claims one should make. How will you make sure that the quality of product is tested, its efficacy is tested and it’s available in a form in which it is.

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