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Ilanet.FunctionalFoodsr1.4 - 19 Sep 2019 - 00:29 - GregorioIvanoff

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An Exploratory Survey on Canada's Potential

A nutraceutical is any food or food ingredient considered to provide medical or health benefits, including the prevention and treatment of disease. (28) The market for nutraceuticals is growing quickly worldwide, and it is this global scope that particularly attracts marketers. (49a) It is estimated that $250 billion, 50% of the U.S. food market of $503 billion, may be attributable to nutraceutical use if taken at its broadest definition (dietary supplements, sugar substitutes, fat substitutes, fiber-enriched foods, vegetables, fatless meat, skim milk, low-calorie diets, etc.). (28) Demand from the larger European population would bring that figure up to $500 billion. (28)

Nutraceutical products are emerging in several European countries, and this has led the European Commission to pursue a common set of rules for the EU. (49a) Nutraceuticals constitute a $4 billion market in Japan, and play a major role in that country’s health revolution. (29) Functional beverages are already a developed market in Japan. Schwepps, for example, is marketing a vitamin C-enhanced cola there. (49b) It is predicted that the gate will open for food and pharmaceutical companies’ nutraceutical products in the U.S. market, mainly because of demographic and health-care trends. (49a) Both the food and pharmaceutical industries are interested in and aggressively developing this product category.

Little is known about the nutraceutical industry in Canada, yet this sector has the potential to grow and capitalize on tremendous global marketing opportunities. It is thus important to characterize the industry as it exists in Canada now, and identify what it needs to help it take advantage of the growing market for nutraceuticals, both as final products and as food ingredients, around the world. The Market and Industry Services Branch of Agriculture and Agri-Food Canada thus commissioned Food Focus to carry out this research.

Novartis PepsiCo bury neutraceutical joint venture

Wednesday, February 27, 2002

Swiss healthcare group Novartis and US snack food giant PepsiCo have decided to shelve their functional foods joint venture, Altus. Earlier, Novartis sold its health and nutrition brands such as malt drink Ovaltine and sports beverage Isostar.

The venture with PepsiCo was formed to sell neutraceutical foods. Neutraceuticals are a combination of foods & pharmaceuticals, that offer benefits such as reducing cholesterol, strengthening bones or improving digestion, through foods as distinct from medicines. Products such as yoghurt that strengthens the immune system, or margarine that reduces cholesterol are examples of neutraceuticals.

Neutraceuticals, a $12bn industry is growing at a faster rate than traditional foods. Both food and pharma companies are attacking this sector. For food companies, it would be a logical extension into a new range of products. For pharma companies, it is a useful diversification from their traditional products that go through the hospital / chemist route.

The immediate trigger for the closure of the Altus venture is Pepsico’s acquisition of Quaker Oats, which used to be a partner of Novartis. After the Quaker acquisition, the venture with Novartis did not make sense for Pepsi. Recent moves of Novartis in any case indicate a strategy to focus on pharmaceuticals.

Keywords: natural capital, sports beverage, malt drink, snack food, health-care, pharmaceutical, opportunities, healthcare, neutraceutical, nutrition, health, food, Ovaltine, Isostar, Novartis, Altus, PepsiCo, Quaker Oats, Switzerland

-- GregorioIvanoff - 23 Nov 2003
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