Herbs & Botanicals in Japan: An Update
Market shifts are expected tolead to new opportunities both short-term and long-term.
By Ron Bailey
Last year’s July/August “Japan Insider” column highlighted the state of the herbs and botanicals market in Japan and how difficult it is to obtain an accurate and consistent estimate of the size of the Japanese retail market for herbs and botanicals. Gauging the size of the market is still a challenge because estimates are a direct function of the ingredients and products that are included in the definition of herbs and botanicals. Including ready-to-drink green tea beverages in the estimate, for example, would add over $4 billion to the retail sales total.
Previous Market Developments
It is possible, however, to obtain reasonable sales data on specific herbal and botanical ingredients, at least for select distribution channels. Capsugel Japan prepared a summary report titled, “Dietary Supplement Opportunity Japan 2005,” which focused on the dietary supplement industry. Several herbs and botanicals, all with retail sales of at least $100 million in 2005, were included in its “Top 20” supplement sales list. The list starts with chlorella, with sales of over $300 million, followed in order by aloe, prune foods, agaricus mushroom, Korean ginseng and ginkgo biloba. With the exception of the relatively recent Agaricus introduction in Japan, these dietary supplements have all been successful in the Japanese market for many years. For perspective, the Capsugel Japan report estimated that the total dietary supplement category in Japan in 2004 posted retail sales of over $10 billion (at current exchange rates).
The non-governmental Japan Health Food and Nutrition Food Association has been responsible for administering the JHFA (Japan Health Food Authorization) standards system, which is an attempt to provide a limited regulatory framework for the most popular health food ingredients. Herbs and botanicals are an important part of that effort. The specific “herbs and plants” category includes: ginseng, prune extract, aloe vera, alfalfa, green tea extract, gymnema sylvestre, garcinia cambogia extract, soybean saponins and isoflavones, garlic, ginkgo biloba, grape seed extract, turmeric and bilberry. JHFA standards have also been established for chlorella and spirulina algae, shiitake and ganoderma mushrooms, evening primrose oil, and oils from rice, wheat and barley germ. A total of 58 standards have been developed. The use of the standards is voluntary, however, and relatively few companies in Japan have opted to use the “JHFA Mark” on their health food products.
Several of these successful herbal and botanical health food ingredients have been able to transition to the popular FOSHU (Foods for Specified Health Uses) food category as recognized functional ingredients. FOSHU products with green tea extracts, as one example, can claim “control of body fat” based on appropriate clinical studies. The formal acceptance of the FOSHU products by the Ministry of Health, Labor and Welfare (MHLW) supports the credibility of not just the specific FOSHU green tea brands being approved, but indirectly the other non-FOSHU green tea and green tea extract foods and beverages as well.
Recent Market Activity Affecting Herbs and Botanicals
The collapse of the rapidly growing agaricus mushroom market has caused consumer credibility problems for the broader herb and botanical market. At the May ifia Japan 2007 international food ingredients and additives show in Tokyo it was difficult to find any agaricus mushroom ingredient exhibits. This is likely the result of very public charges (and jail time) for company officials who made illegal drug claims for agaricus products. There was also a serious consumer safety event that further eroded consumer confidence in the ingredient. The target market had been the important immune function category, a traditional area of research for mushroom products in Japan.
Unofficial but consistent reports from ifia Japan 2007 exhibitors indicated that the expected fall 2007 formal adoption of a FOSHU Anti-Fatigue Category has been delayed by MHLW. It is generally be-lieved that MHLW has not yet been convinced by the supporting science for the ingredients, even though several functional ingredient manufacturers have been sharing information with MHLW for some time. Several herbs and botanicals are vying for acceptance for use in FOSHU anti-fatigue products. The unofficial list typically includes astaxanthin, soy peptide, green tea theanine/theobromine, GABA (gamma-amino butyric acid) and ginseng. At this point it is not clear when the MHLW FOSHU Anti-Fatigue category will be formalized. Even the most optimistic participants suggest approval will not happen this calendar year and maybe not even next year.
A new regulatory system for herbs has just been implemented by MHLW to allow OTC (over-the-counter) drug status for herbs and botanicals that have a history of use as regulated drugs in other countries. Echinacea, for example, would be a likely candidate based on extensive European drug experience. The incentive for the new regulations apparently relates to the Japanese involvement in World Health Organization (WHO) deliberations. Examples of unresolved issues include the costs of registration, the safety and efficacy data requirements, and whether or not the approvals will be generic for herbal and botanical ingredients versus product-by-product. Even experienced retail herbal marketers in Japan are awaiting further guidance from MHLW before developing a strategy for using the new regulations.
ifia Japan 2007 Herbal/Botanical Activity
There were not many truly “new” herbal and botanical ingredients exhibited at ifia Japan 2007, but there were several important shifts in the marketing of existing ingredients. Citing just a few brief examples:
Astaxanthin—There were many more exhibitors of this algae-based ingredient, both domestic Japanese as well as overseas producers. The target markets be-yond the well-known antioxidant properties were for anti-fatigue, anti-stress, and anti-inflammatory benefits. The delay in the FOSHU Anti-Fatigue category approval may result in a slowdown in additional clinical research and biomarker development, however.
AsparaGABA—This is an example of a claimed “more natural” approach to providing a source of the popular blood-pressure lowering and anti-stress ingredient GABA, which may signal the beginning of a trend for this important functional ingredient. The ingredient is produced by lactic acid bacteria fermentation of an asparagus/asparagus juice complex.
Flax Seed/Oil—This ingredient, often imported from Canada in seed form for processing in Japan, is becoming more popular based on its ALA (alpha linolenic acid) content. The Flax Seed Oil Association in Japan is claiming that MHLW is now encouraging the consumption of omega 3 ALA in the diet to replace the declining consumption of fish-based omega 3’s EPA (eicosahexaenoic acid) and DHA (docosahexaenoic acid). This interesting claim has not yet been confirmed from other sources in Japan.
Cosmeceutical Benefits—There were several botanical ingredients positioned for skin health at ifia, including sea buckthorn oil, black soybean hull extract (skin whitening), soybean isoflavones and litchi and kiwi extracts (skin rejuvenating). Non-herbal systems, such as fish collagens and peptides, are even more popular, despite the growing interest in plant-based ingredients with similar efficacy. The emphasis on skin health is not new, but the development of new clinical evidence to support claims is a welcome trend. NW
Note: Important sources of information for this article include the ifia Japan 2007 guidebook, an October 2005 Japanese Health Food and Nutrition Food Association brochure, and the Capsugel Japan “Dietary Supplement Opportunity Japan 2005” report.