India: A global nutraceutical hub in the making

Scientific nutrition has always been arborvitae of India since 3300 BCE.  Ayurveda is one of the most scientific ancient texts on clinical nutrition and preventive health nutrition. This science took a backseat due to chronic exposure of India to foreign invasions that disrupted its progress. Meanwhile, in the early 1900s, the Western world had begun to witness the newly found gold rush for vitamania. The discovery series were motivated by the principles of pharma leading to molecular reductionist approach coupled with clinical validation methodologies. The discoveries of those times evolved into a convergence of allied fields like biotechnology, agrotech, chemical engineering, pharmaceutical technologies and principles; thus fuelling the onset of nutraceuticals – the newly formed discipline with relatively lesser-known long term health impact but commands unified global support that interprets to $387 billion markets.

Global nutraceutical market continues to grow at eight per cent per annum with the US commanding 60 per cent of the market share.

Nutraceuticals are only going to get bigger with time as the “want” for preventive health turns into a “need” in the current times. Hence, it is bound to be an integral part of any country’s economic growth strategy.

For instance, India intends to become an economy which will touch $10 trillion by 2030. The quadrupling of growth is certainly worth praise, but the question is who would deliver these numbers? The citizens of India? 840 million citizens are calorific sufficient but malnourished. Subjecting the absolute majority of the population to stress to achieve a $10 trillion economy would open up the unknown challenge of managing lifestyle diseases that will spiral without many controls.

The growing population size, information access, increasing spending power, the emerging “need” to stay healthy – the nutraceuticals in India is bound to have a robust growth for the next few decades. Currently, Indian nutritionals/nutraceutical industry is $9 billion, growing at 12 per cent per annum.  

The question is – how equipped is India to develop and deliver high quality, clinically validated nutraceuticals and what is its equity into the global market in the field of formulated products and ingredients?

Most of the Indian nutraceutical industry operates with a “cookie-cutter” model and has not evolved with times. India’s exports in nutraceuticals are slightly below $250 million (ingredients and formulation combined). That’s negligible equity into the global nutraceuticals market of $387 billion. On the other hand, India imports active ingredients and formulated nutraceuticals to the tune of $2.3 billion. It has 108 large contract manufacturers in nutraceuticals, but none can tap into international projects. 

For India to emerge as a nutraceutical hub that delivers world-class high science nutraceutical products to serve the needs in India and also command a respectable share in the international nutraceutical market, it will need some structural categorisation in ministries, start-up incubation hubs and regulatory. 

On government front

1. Incubating nutraceutical industry: To enable and empower the nutraceutical industry, it needs to be incubated first and this would essentially mean centralised ownership. The most suited ownership would be with the Ministry of Food Processing Industries (MoFPI). This would mean including the ecosystem (Active Nutraceuticals Ingredients, formulations, contract manufacturing, raw materials processing) of nutraceuticals under it. MoFPI could create a sub-category as Medical/Health foods. Nutraceuticals are the other side of the coin named food/nutrition. Irrespective of its science, outcomes, it is still a portion of food. Hence it would naturally fit into MoFPI. By creating a subcategory and incubating the industry under it would enable the government to roll out an industry-specific focussed incentivisation programme. 
2. By including medical foods ecosystem into MoFPI, the component related to Biodiversity laws in MoEF (Ministry of Environment, forest and climate change) and NBA (National Biodiversity Authority) could be managed under MoFPI ministry. This will stop Indian innovators using the US as the platform to launch their plant ingredient discoveries and help small to medium-sized players ramp up the business (which is currently curtailed by the complexity of biodiversity laws)
3. Include medical foods/nutraceutical parks under PMKSY scheme of MoFPI, that could lead to focussed parks in strategic locations of India to enable entrepreneurs as well as larger players in nutraceuticals to tap into research/ development lab complex, prototyping, testing, validation, common facilities (like blender farms, SCO2 facilities, Spray drying, freeze-drying, fermenters, etc.) and market access. An initiative of MoFPI creating National Institute of Food Technology Entrepreneurship Management (NIFTEM) is an appreciable first step towards fully evolved ecosystem park that seems to be a near-future possibility now.

Regulatory measures

1. Lacking enforcement: While FSSAI/Ayush continues to evolve in the right direction; resource constraints and the vast area of food regulations, unlike in pharmaceuticals has kept regulators distant from effective enforcements. This has resulted in some nutraceutical/Ayurveda companies indulging in deviated claims and practices bringing in loss of trust and disrespect to the industry.
2. Technical staffing in-licensing and product approval committee to appreciate the scientific rationale and be able to approve high science novel nutraceutical products.

Ministry of Finance

1. Moderating the import duties to allow space for local ingredient manufacturers to develop. 
2. Incentivisation to medical food / Nutraceutical exports 
3. Taxation structure of 18 per cent tax (with few categories even taxed at 28 per cent) to be revised to make nutraceuticals more accessible.

State ownership as host

For nutraceutical parks to evolve state governments must have a vision and own up to host the ecosystem park. The Telangana govt in India is taking huge steps in creating ecosystems for various components of healthcare including creating an incubation park for the nutraceutical industry. The project is being driven by Shakthi Nagappa-Director (Life Sciences and Pharma); under the guidance of present government in the state of Telangana.   

Industry initiatives

1. Indian nutraceutical industry needs to evolve to self-regulate to ensure that there is a collective projection of industry in responsible nutrition and not a short cut revenue generation channel. 
2. Embracing Nutrify India Initiative as it enables responsible nutrition innovation through start-up. This initiative commercialises innovation through government market access programs as well as large companies with strong supply chains. 
3. Work closely with the Responsible Nutrition Association in creating standards that can be used internationally too.
4. Work closely with incubation hubs for tapping high-end innovation. There are 4000 nutraceutical startups in India working with various incubation hubs supported by the government’s innovation promotion bodies like BIRAC and AIC
5. Accept clinical trials and validation as new norms. With the onset of the pandemic, there is a major push from the government for clinical validation of ingredient or formulation. It is best showcased with a large scale study on 80,000 subjects being rolled out by the government on AYUSH ingredients to establish efficacy.

Combined efforts would not only lead to better health outcomes, enabling a healthier population to deliver higher economic objectives of the country, but also build strong equity into the global nutraceuticals space.