Nutraceuticals: The new $240-billion gold mine for Indian spices

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KOCHI: It was in the early 1990s that the Indian spice extract companies began to wake up to the potential of the nutraceuticals sector. They started out as the suppliers of ingredients. Thereafter, leveraging India’s traditional knowledge about spices and herbs, they gradually shifted to formulations and products.The transition has not been easy, especially because competition has intensified. They found that they cannot globally market the herbal products made from spices the way they do it in India. The product has to go through clinical trials and the details have to be published in major journals to be accepted overseas.”The future of spices is in the nutraceutical sector, which may see a multi-fold growth,” says Dr K Nirmal Babu, director of Indian Institute of Spices Research (IISR).Today, there are Indian companies with over 100 patents for nutraceutical products. Once they isolate a compound through research and clinical trials, they soon patent it to stay ahead of the competition. Till recently, foreign markets used to be their principal revenue generators. Now, rising health awareness is making people take to dietary supplements in urban India too.”Globally the nutraceutical market may soon touch $100 billion mark. The total market for nutraceuticals in India is growing at 21% and is valued at Rs 15,000 crore. Since spices are considered safe sources of natural products, they possess a prime spot in developing nutraceuticals,” Nirmal Babu explains.The US is the biggest market for nutraceuticals followed by Europe. “More people in the US have the habit of taking health supplements,” Ranjit Ramachandran, CEO of oleoresin exporter Plant Lipids Ltd. points out.Among Indian companies, Bengaluru-based Sami Labs, with over Rs 1,000-crore turnover, has been a pioneer in the field of nutraceuticals. It had come out with its first product in the early nineties. It has been growing in strength ever since. “We hold 243 patents now and another 219 are in the pipeline,” says founder chairman Muhammed Majeed who hails from Kerala.After his education and pharma industry experience in the US, Majeed launched his first product Gugulipid in 1990. Made out of the resin from Guggul tree and meant for cholesterol reduction, it was the first product under Ayurveda brand in the US, he says.Subsequently, he made products from spice Garcinia (pot tamarind) and isolated a compound called bioperine from black pepper that helps increase bio availability or full absorption of nutraceutical in the body. Another one from Boswellia Serrata (Indian Frankincence), meant for preventing inflammation, followed. All these came in the nineties.According to Majeed, products based on curcumin extracted from turmeric are the most popular in the nutraceuticals segment. “Curcumin has anti-inflammatory properties and hence can be used as dietary supplement against arthritis, cardiovascular disease, cancer and several other ailments,” he points out.The Kerala-based Arjuna Natural Extracts, another company with a major presence in the nutraceutical sector, has 50 patents on turmeric formulations alone out of a total inventory of 102. “Turmeric is perhaps the most researched spice and we have 65 publications on it,” says joint managing director Benny Antony. The company’s BCM-95 bio available curcumin product has been a sort of a trend-setter in the spice nutraceutical sector.Ginger, chilli (particularly capsicum), garlic, cinnamon, black pepper and herbs like rosemary, holy basil etc are in high demand in the nutraceuticals industry. To get these raw materials in the quantities they need, big companies go for contract farming and even import them at a cheaper rate.India’s share in the global nutraceutical products is negligible so far, and industry insiders believe that the country has huge potential. “The sector is currently dominated by China and Europe. India’s presence is growing,” says Majeed, who has shifted his manufacturing operations mostly to India from the US to cut costs.Ramachandran reckons that while China has the biggest presence in nutraceuticals, India may have an advantage. “Indian nutraceutical products have better acceptance as they are backed by tested documents and publications.”The growing market for nutraceuticals has prompted major exporters of spice oleoresin(extract) to take the plunge. They are gearing up to make a significant impact on the sector by cashing in on their commanding presence in the global spice oleoresin market.It may not be an exaggeration to say that the Indian oleoresin industry begins and ends with Kerala.Companies from the state account for the bulk of the over Rs 2,000-crore spice oil and oleoresin exported by India. They supply to international flavour and fragrance houses such as Givaudan and Firmenich in Switzerland, International Flavours and Fragrances in the US, and Symrise in Germany.”India likely has 60-70% share of the global oleoresin market,” says Ramachandran of Plant Lipids, the company that has ten branded nutraceutical ingredients under its Aurea Biolabs division.Of the nutraceutical industry’s three main segments of herbal/natural products, dietary supplements and functional foods, the first two are growing rapidly, according to Nirmal Babu of IISR. “The greatest scientific need pertains to standardisation of the nutraceutical compounds or products and development and execution of clinical studies to provide the basis for health claims to produce an impact on the consumers as well as on the nutraceutical companies,” he says.Not surprisingly, all big oleoresin exporters have turned their attention to the emerging area of nutraceuticals.The Rs 1,750-crore Synthite Industries Ltd, India’s top spice oleoresin exporter, has a range of products targeting different health benefits from spices and other herbs. “We are now researching on a curcumin-based product that helps control hangover,” says Synthite MD Viju Jacob.Corporates are now putting more money into R&D to develop new products. Akay Flavours and Aromatics, an oleoresin exporter, has christened its nutraceutical wing as spiceutical and has earmarked Rs 15 crore for research. “Two challenges we faced when went into nutraceuticals are how to deal with taste and aroma of spices which can be pungent and its bio availability to make it more effective,” says Babu P Maliakal, the MD of the company.Akay was successfully able to extract a compound from fenugreek that could serve the purpose. “We could mask the bad aroma as well as increase the bio availability of our products using it,” he adds. The company has tied up with Amway to sell its products in the B2B space.As the growth in nutraceuticals has begun to saturate in Western countries, the focus is shifting to Asia. “Asian countries are witnessing a double-digit growth in nutraceuticals with increased health awareness,” says Ranjit Ramachandran.Companies have also started targeting the Indian market having sensed the growth potential here. Arjuna Natural Extracts, a Rs 300-crore business, has already entered the Indian market with Curegarden range of natural health and herbal supplements. “We have tied up with Amazon. We find more and more takers for our products in India,” Benny Antony says.Synthite, currently present in the B2B segment, is exploring the possibility of moving into the B2C space, particularly in the Indian market. Sami Labs is also focusing on the Indian market and has drawn up an ambitious expansion plan to double its manufacturing units from six at present.The competition from synthetic ingredients seems to have impacted the nutraceutical sector adversely last year. “Last year we faced a setback in Europe as some Hyderabad-based companies used synthetic ingredients of turmeric which caused side effects in Italy. This created a negative propaganda on turmeric, thus affecting genuine players,” reveals Antony of Arjuna Natural Extracts.

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