Medical Foods Market Size, Share & Trends Analysis By Route Of Administration (Oral, Enteral), By Product (Pills, Powders, Others), By Application, By Sales Channel (Retail, Online, Institutional), And Segment Forecasts, 2019 - 2025

Industry Insights

The global medical foods market size was valued at USD 17.15 billion in 2018 and is anticipated to register a CAGR of 6.7% over the forecast period. Increasing geriatric population, burden of chronic diseases, and awareness about clinical nutrition among healthcare professionals and patients are key factors propelling the market growth. Chronically ill patients suffer from nutrient deficiencies owing to adverse effects of the disease or drugs that are used during treatment and medical foods address these nutrient deficiencies, owing to which their demand is rising in the management of chronic health conditions.

Constant innovations and new product launches by leading manufacturers are also among the major factors boosting the product demand. For instance, in June 2018, VAYA Pharma, Inc. introduced Vayarin Plus extending its medical food offerings. It is the extra-strength formula in Vayarin, which is indicated for the clinical dietary management of ADHD in adolescents and adults weighing over 97 lbs. (44 kg). In another instance, Cambrooke Therapeutics, Inc. launched two hydration beverages Glytactin RESTORE Lite Powder and Glytactin RESTORE Powder for the dietary management of phenylketonuria.

Various strategic initiatives in the area of clinical nutrition have also positively impacted the market growth in the recent years. Some of these initiatives include M&A, new product launches, distribution agreements with other companies, and supportive initiatives for increasing the awareness about clinical nutrition. In the recent past, BASF Corporation formed a distribution agreement with DIEM Labs, LLC for the commercialization of medical food products of BASF, which is indicated for managing nutritional deficiencies in patients suffering from Non-Alcoholic Fatty Liver Disease (NAFLD). In 2017, Ajinomoto Co., Inc. entered the U.S. medical foods market with the acquisition of Cambrooke Therapeutics, Inc.

In the same year, Caret Group acquired Fiber Choice to enhance the product offerings of IM Health Science, which is a subsidiary of Caret Group, specialized in medical foods. This acquisition was in alignment with the company’s strategic goal of identification of dietary interventions for the patients suffering from functional dyspepsia and irritable bowel syndrome. In July 2017, a trade organization for functional foods and dietary supplements, the Council for Responsible Nutrition (CRN) included medical foods in its nutrition portfolio, along with functional foods and dietary supplements.

Route of Administration Insights

Orally administered products accounted for the largest revenue share of 68.9% in 2018. The administration of nutrients and vitamins through oral route is widely practiced. There are several types of products, which are administered through the oral route. Oral supplements are available in the form of powder, liquid, pills, pudding, and pre-thickened products.

High preference for orally administered products, availability of large number of products in this form, and supportive initiatives are the key factors driving the segment growth. As per data published by British Specialist Nutrition Association Ltd., provision of prescribed oral nutritional supplements to malnourished patients reduces the risk of infections by 70% and mortality by 40%.

Enteral administration segment is expected to witness the fastest CAGR of 7.2% over the forecast period. The demand for enteral feeding formulas is rising owing to increasing prevalence of chronic diseases, such as cancer and Cardiovascular Diseases (CVDs), which results into various metabolic issues, leading to difficulty in consuming diet, during the disease treatment. Moreover, technological advancements in the allied industries, such as enteral feeding devices, also positively impacts the market growth.

Product Insights

The other product type segment, which includes semisolid, liquid, and gel-based formulations, accounted for the largest revenue share. The segment is also anticipated to witness the fastest CAGR of 7.2% over the forecasts period. Ease of administration, commercial availability, and large application areas of these products are the factors responsible for its growth. Preference for liquid formulations is higher among geriatric and pediatric population owing to ease in consumption, especially for oral administration. Some of the example of medical foods in the formulations other than powder and pills are Nutrini Peptisorb Energy (Danone), Nutrison MCT (Danone), and Glucerna Therapeutic Nutrition Shake (Abbott).

Moreover, new product launches in this product segment is driving the market further. In 2016, Cambrooke Therapeutics launched KetoVie Peptide, a ketogenic formula intended for intractable epilepsy. Powder products is the second fastest-growing and largest segment on account of constant innovations in terms of product. For instance, in 2016, Cambrooke Therapeutics, Inc. launched Tylactin RESTORE Powder, a hydration beverage, for dietary management of Tyrosinemia (TYR). In 2017, Danone India launched its global brand Neocate in India. It consists of hypoallergenic, amino acid formula.

Application Insights

Diabetic neuropathy accounted for the largest revenue share in 2018. Diabetes is one of the growing health concerns globally. As per the 7th edition of International Diabetes Federation’s (IDF) Diabetes Atlas, in 2015, nearly 415 million adults were affected by diabetes globally. Nearly 60 to 70% of diabetic patients are reported to have some level of neuropathy, as stated by Diabetes Self-Management (2014). Thus, high disease prevalence and increased focus on nutritional management are key factors attributed to the segment’s highest revenue share.

Few medical foods intended for diabetic neuropathy are Percura capsules, METANX, and Foltanx. Chronic Kidney Disease (CKD) is expected to emerge as the fastest-growing segment at a CAGR of 9.7% over the forecast period. As estimated by National Kidney Foundation, 10% of the global population is affected by CKD and more than 2 million patients globally receive dialysis treatment or a kidney transplant. Dietary factors have a significant impact on disease progression and its complications.

During progression of CKD, the nutritional requirements change significantly. Thus, the demand for medical foods is rising for dietary management of CKD, representing lucrative growth opportunities for the segment. Malabsorption of nutrients and food allergy are directly related to the potential treatment of neurologic syndrome. Also, there are a few research publications, which have categorized the “syndrome of allergy, apraxia, malabsorption” in one group.

Growing investments and interests in this field by the key market participants, such as Nestle, Abbott, and Danone, are the key factors expected to drive the segment over the forecast period. There are very few commercially available medical foods that are specifically designed for Autism Spectrum Disorder (ASD)/Apraxia Patients. For instance, Tesseract Medical Research, LLC markets AuRx, which is specifically designed for ASD patients. Increasing demand for medical foods specifically catering to ASD/Apraxia Patients presents significant growth opportunities to market participants.

Sales Channel Insights

Key sales channels include retail, institutional, and online sales. The institutional sales channel, which further includes hospitals, home care settings, and disability facilities, accounted for the largest revenue share. These institutions enter in long term contracts with companies. High product demand in inpatient facilities is the key factor responsible for the large share of institutional sales.

However, shifting trend of direct selling to customer via e-commerce platform due to ease of procurement, competitive prices, and large number of options to choose from on these sales channel may hinder institutional sales segment. Retail sales channel accounted for the second-largest revenue share in 2018. Sale of clinical nutrition products through retail pharmacies has increased considerably in the recent years. Availability of clinical nutrition products at grocery stores and supermarket is rising. Moreover, number of grocery stores are proactively undertaking initiatives for promoting health of individuals. This is expected to positively impact the segment development.

Regional Insights

Asia Pacific accounted for the highest revenue share in 2018 and is expected to have the fastest CAGR of 8.2% over the forecast period. Increasing cases of target diseases, such as diabetes, malnutrition, obesity, cancer, and CVDs in this region is the major factor contributing to its growth. Rising geriatric population base is also likely to contribute to the market development. Moreover, presence of key companies, such as Abbott and Nestlé, in the region and high revenue generated by these companies are expected to boost the market further.

China, in particular, is the leading country in Asia Pacific region. As per Diabetes Country Profiles released by the WHO in 2016, CVDs and cancer accounted for the majority of the deaths in the country. Regulatory changes concerning clinical nutrition are also expected to positively impact the market growth. As per Chemical Inspection and Regulation Service (CIRS) Limited, in July 2018, State Administration for Market Regulation (SAMR) issued a notice regarding the registration information of Abbott’s two foods for special medical purposes.

Medical Foods Market Share Insights

The market is consolidated in nature with Danone, Abbott, Nestle, Mead Johnsons, and Fresenius Kabi accounting for the maximum share. These companies are following several strategies to increase or sustain their market share. Geographic expansion, high investments in R&D to develop disease-specific formulas are among the few strategies. They are also collaborating with policymakers to address the issue of malnutrition in the respective countries.

Report Scope

Segments Covered in the Report

This report forecasts revenue and volume growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the global medical foods market report on the basis of route of administration, product, application, sales channel, and region:

• Route of Administration Outlook (Revenue, USD Million, 2014 - 2025)

  • Oral

  • Enteral

• Product Outlook (Revenue, USD Million, 2014 - 2025)

  • Pills

  • Powder

  • Others

• Application Outlook (Revenue, USD Million, 2014 - 2025)

  • Chronic kidney disease

  • Minimal hepatic encephalopathy

  • Chemotherapy-induced diarrhea

  • Pathogen-related infections

  • Diabetic neuropathy

  • ADHD

  • Depression

  • Alzheimer's disease

  • Nutritional deficiency

  • Orphan diseases

    • Phenylketonuria

    • Eosinophilic esophagitis

    • FPIES

    • Others

  • Other

• Sales Channel Outlook (Revenue, USD Million, 2014 - 2025)

  • Online Sales

  • Institutional Sales

  • Retail Sales

• Regional Outlook (Revenue, USD Million, 2014 - 2025)

  • North America

    • U.S.

    • Canada

  • Europe

    • U.K.

    • Germany

    • France

    • Spain

    • Italy

    • Russia

  • Asia Pacific

    • Japan

    • China

    • India

    • Australia

    • New Zealand

    • Singapore

    • South Korea

  • Latin America

    • Brazil

    • Mexico

    • Argentina

  • MEA

    • South Africa

    • Saudi Arabia

    • UAE