Companies are shifting from dietary supplements and packaged food materials to medical food based products
Demand for healthy diets and consumer perceptions towards food as medicines has led many giants to prioritize their marketing strategy towards medical foods. Consumers prefer purchasing supplements or foods that are clinically proven and are able to minimize the ill effects of chronic illness. The trend is stronger among aging population that accounts for 22% of total population. As a result, few major companies have prioritized their business towards medical foods. This is expected to help companies generate higher profit margins and further expand business presence. For instance, Nestlé is actively enhancing its presence in the medical foods segment through its already wide distribution networks worldwide. In 2016, Nestlé Health Science entered in agreement with Seres Therapeutics to develop food products that can restore natural microflora of the gut. Further, in 2018, Nestlé has invested US$ 151.3 million in two factories in China in order to boost its medical food products and skincare products.
Another major company, Danone opened Nutricia Cujik production facility in March 2019. The company has invested USD 266 million in production plant to meet increasing demand of specialized infant nutrition especially in Europe.
New Entrants to Emerge in Medical Foods Market
Regularization of medical foods has led to emergence 0f many new players in the market. While few players are focusing on enhancing distribution channel, others are emphasizing on product R&D to ensure long term sustainability. For instance, BASF entered the Medical foods market in 2017. Such developments could potentially prove a challenge to already established players. BASF Corporation entered in distribution agreement with DIEM Labs LLC to commercialize its first U.S. medical food products for Non-Alcoholic Fatty Liver Disease (NAFLD) patients.
Diabetic Neuropathy to be the Largest Therapeutic Application Segment in 2019
By therapeutic applications, medical foods sale is expected to be dominant in diabetic neuropathy segment. The segment was valued at US$ 3,659.9 million in 2018 and will continue to register significant growth throughout the forecast period.