The conference was set on a two-day closed sessions, addressing regulatory, marketing and sourcing concepts that affect and shapes the fish oil industry as a whole, EPA/DHA in particular.
GOED Conference speakers, and attendees, agreed EPA/DHA to be the current most important market, eventually becoming even larger. Although the EU and Asian markets are steadily growing in importance (volume mostly), EU’s regulatory aspects and Asian traditional food and medicine practices will make their market development take longer.
EPA & DHA most important sources remain marine-origin fish oils. Vegetable sources have still a road to transit prior having a truly and long lasting competitive stance against marine-origin EPA/DHA.
Krill oils, although all in consensus to be a new ingredient, it was labeled as the “star-of-the-show” by one speaker. Although still small in volume, its >20% CAGR is the most impressive one among all marine-origin lipids.
With the current EPA & DHA consumption trend, with it comes the importance to sort out several concepts, such as (1) is it medical treatment or supplementation? (2) Prevention purposes? (3) can be used as a trauma response ? (4) ARA demolition?
One thing for sure is that regulatory aspects will prevail as the main problem for a healthy growth of the category, more in the EU market.
Regulation, at least in the US, has been sorted out in a much better way, at least for sales volumes, in terms of quality between an Rx and a Dietary Supplement. This will bring more changes for these regulations, but not necessarily an ease of current ones.
The big question…..will pharma and dietary supplements co-exist?
Under the US perspective (1) Rx formulations (under physicians supervision) are appropriate when provision of EPA and DHA are part of the medical management of very high triglycerides, (2) It may not be appropriate to raise EPA/DHA levels in healthy individuals that do not eat fish, pregnant woman, or a child who hates fish, (3) Insurance reimbursement for Rx n-3 when used for very high TGs.
Nonetheless, there is no ‘alternative’ physiology, (4) High quality dietary supplements providing the same amount of EPA and DHA in the same ratios showing the same biologic effect as compared to a drug and (5) The only difference will be the label and allowable claims.
The current coexistence of Rx and dietary supplement omega-3 fatty acids has likely benefited both categories through (1) Multiple marketing efforts maximizing consumer awareness (2) Maximized distribution channels and (3) Increased physician and pharmacist awareness and comfort of the category
Rx products continue discrediting dietary supplement omega-3s in an attempt to gain market share, however, dietary supplements will continue to thrive as a category due to (1) The variety and flexibility of dietary supplement omega-3 products and claims (2) The legal and regulatory environment favor the latter (3) Supply chain transparency and (4) Clear consumer preferences.
The success of Rx Omega-3s anyway may be representative of the size and scope of the Rx market and not a result of siphoning sales from DS products.
The biggest threat to the dietary supplement Omega-3 products would be a significant change to USA’s DSHEA where DS Omega-3 companies would benefit from being vigilant about protecting supplement regulation as opposed to focusing on the success of Rx products.
How about risks? and hazards? this is a dilemma that was also addressed, being (1) The purpose for setting specifications is to control risks, not eliminate hazards (2) The absolute absence of a risk can only be proved when it is certain that exposure does not exist (3) The Goal of “I can’t find it so it must be safe” approach to controlling environmental risks is flawed and (4) Analytically, regulators must link the term “no residue” to a current method of analysis; constrained to a limit of detection.
One speaker urged for a set of fish-oil specifications that may define how the category will look and be traded in the near future, among them (1) Physical and chemical properties, e.g. appearance, odor, taste (2) Fatty acid composition, e.g. EPA, DHA. Mono- di- and tri-glyceride, (3) Environmental contaminants, e.g. PCBs, furans, dioxins and (4) Biological contamination, e.g. E. coli, Salmonella spp., coliforms
On marketing aspects, brand loyalty is significantly important for the category. Omega-3 users are the ones that have the highest brand loyalty. Same users also have the largest desire for good quality and are willing to pay more for it.
And it is end users’ awareness what will define how much growth the Omega-3 category will support in the coming 4 to 5 years.
Overall, Omega category main drivers seen to be (1) Brands (2) Private labels (3) BRIC markets (4) Beverages in Europe, Latin America (5) Foodservice, seasonal immunity products (6) Facial and skin care in Asia / Pacific and (7) Pet nutraceutical treats.
In terms of krill biomass and resource condition, it is still based on theoretical requirements although there is currently a precautionary catch limit equals to 9% of stock biomass (in 2000) and the operational catch limit (“trigger level”) is only 1% of the current estimate of stock size.
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Can red he report at GOED Exchange Conference (2011)(Summary)