Reporter Liu Yanfang and Luo Chen
The big health industry is recognized as a blue ocean, so in recent years, various capitals have rushed to enter the game. With the strong support of national policies such as the National Nutrition Plan (2017-2030), the nutrition and health industry is firmly on the rise.
The high-quality development of the nutrition and health industry is inseparable from both scientific and technological innovation and capital investment. At the "Health Food Investment and Financing Forum" of the 2024 Boao Health Food Science Conference and Expo (FHE2024) Pilot Conference held recently, Chen Junshi, chairman of the FHE2024 conference and academician of the Chinese Academy of Engineering, pointed out that at present, China's nutrition and health food industry is under favorable conditions of favorable policy environment, continuous development of science and technology and strong consumer demand. The guests at the meeting believed that with the development of China's economy and the continuous improvement of residents' income, health literacy and scientific and technological development, "opportunities will always outweigh challenges" in health food investment and financing.
Academician Chen Junshi, Chairman of FHE Conference.
The primary market is still hot, and investment has ushered in a "new stage, a new situation, and a new change".
**The National Nutrition Plan (2017-2030) issued by the General Office in 2017 clearly states that it is necessary to develop the food nutrition and health industry and accelerate the transformation of nutrition. "The National Nutrition Plan has elevated food nutrition and health to an industry, which we professionals did not expect. Chen Junshi said that this is enough to show that the country attaches great importance to healthy food. Zhang Fei, deputy director of the Foreign Investment Institute of the International Economic Cooperation Research Institute of the Ministry of Commerce, believes that healthy food not only meets the material needs of consumers, but also brings spiritual pleasure and satisfaction to residents, which is very in line with the important policy orientation of high-quality development in China.
From 2015 to 2018, almost all of the world's food and beverage companies have classified nutrition and health care as a new growth point in the future, and Chinese companies are very active in cross-border mergers and acquisitions to invest in overseas nutrition and health product brands. Huang Wenjun, director of the food and agriculture research department of Rabobank, believes that the health food industry will develop rapidly under the joint promotion of domestic fundamental support, population aging, consumers seeking disease prevention and healthy lifestyles. "With the growth of per capita GDP, the per capita expenditure on health food has increased year by year. Around 2010, the per capita GDP of Chinese was about 4,500 US dollars, and the expenditure on health food was 77 USD; In 2023, the per capita GDP will be around $12,500, and the expenditure on health food will be close to $24. We expect to spend more than $33 on health food in 2024, but even so, there is still a lot of room for growth compared to the $80-100 per capita expenditure in South Korea and Japan. ”
Huang Wenjun, Director of Food and Agriculture Research at Rabobank.
Xu Yuqing, business director of SDIC** Life and Health Industry Group, pointed out that since 2020, driven by the improvement of residents' health literacy and the empowerment of new technologies, a new cycle of high-quality development in China is taking shape, and the forms of health products are more diversified, and emotional value, customization, and scientific evidence are becoming the highlights of the development of the food industry in the new cycle. From 2021 to 2023, 9 companies in the health food industry will be listed, another 5 IPOs will be suspended, and 5 will be in the review stage. Xu Yuqing said that before the Spring Festival this year, the China Securities Regulatory Commission held a symposium to support the mergers and acquisitions of listed companies, giving the investment industry great confidence, and the mergers and acquisitions between listed companies in the future may bring about an increase in performance and a catalyst for stock prices, resulting in a second growth curve.
Xu Yuqing, business director of SDIC** life and health industry group.
At present, the investment in the food industry has ushered in a "new stage, a new situation, a new change", Qi Yuqian, executive general manager of Huatai United ** large consumption industry, pointed out that from 2015 to 2017, the catering and food and beverage industry is a hot spot for investment, reaching a small peak in 2017, and last year it set off a new investment boom in the fields of new tea drinks, health food, snack food, and special medical food. "Food is always hot. He said that any policy or any track enjoys the dividends of the times, but the dividends of the times will eventually pass, and practitioners in the primary and secondary markets need to constantly adjust and innovate, and update their work priorities and working methods in a timely manner to achieve the "sun rises as usual" in the new stage.
Qi Yuqian, executive general manager of Huatai United ** Large Consumption Industry Department.
There are challenges and opportunities, and opportunities are always greater than challenges. Jiang Weiming, former president of DSM China and partner of GL Capital, said when evaluating the future investment in health food.
Jiang Weiming, former president of DSM China and partner of GL Capital.
Consumer demand and scientific and technological innovation have created investment and financing hotspots in the new track of the industry
If the flowers are in full bloom, the butterflies will come. The global market has seen the growth opportunities of the health food industry, and more and more serious medical, food and beverage, and even cross-border brands are actively deploying in this field. So, what are the tracks that deserve the attention of capital?
Age-appropriate food is definitely an opportunity," Chen said. Foods for the elderly refer to pre-packaged processed foods that can be suitable for the decline of digestive function and other physiological functions of the elderly. Digestive system dysfunction is prevalent in the natural aging process of the elderly, which is the main cause of various forms of malnutrition that directly affects the food intake, digestion and absorption of the elderly, resulting in loss of appetite, and is also a risk factor for geriatric diseases such as muscle attenuation, osteoporosis, cognitive impairment and frailty. In order to meet the nutritional needs of the elderly, in 2022, the Nutrition and Healthy Aging Working Group of Shanghai Junshi Institute of Life Sciences proposed the concept of "food for the elderly", and suggested that the competent authorities should issue a national-level "guide for the production and application of food for the elderly" to promote the orderly and healthy development of the food industry for the elderly. "Junshi Life Science Research Institute is jointly carrying out market research on food for the elderly with Ou Rui Consulting," Chen Junshi said, "Judging from the current data, due to the differences in concepts, cognition, policies, support environment and other aspects, China is still vague in the direction and positioning of the development of food for the elderly, and the product is in a state of great lack." ”
Chen Xin, executive director of Northern Light Venture Capital, pointed out that due to the different living environments and backgrounds of each generation, there are differences in consumption concepts and behaviors, and a series of new consumption scenarios and consumption patterns have emerged. Compared with the past, the current elderly group has more demand for travel, making friends, and gatherings, and the requirements for quality of life are also constantly improving. Therefore, the scientific and technological innovation of the health food industry should also be combined with the humanistic spirit to meet the more extreme experience of consumers.
Chen Xin, Executive Director of Northern Light Ventures.
Biosynthesis technology is also a new growth point for the development of the food industry. Chen Junshi pointed out that the use of microorganisms to purposefully carry out genetic modification to produce products that did not exist in the past, such as various enzymes needed by the food industry, will effectively promote the innovation and development of the industry. Approved by the National Health Commission last year, two types of breast milk oligosaccharides (HMOs) that can be used as nutritional fortifiers for infant formula, prepared milk powder (for children) and special medical baby food, are produced by fermentation using genetically modified microorganisms, "which can be regarded as a milestone in the food industry".
Since 2017, we have been focusing on the systemic opportunities of biotechnology in the food industry. Zheng Di, investment director of Food Core Capital, said that biotechnology is a revolutionary technical means, especially for engineering use. Optimistic about the new generation of gene editing technology, bioactive ingredients, precision fermentation and other fields, Food Core Capital is currently focusing on new raw materials brought by synthetic biotechnology. The "14th Five-Year Plan" for the development of bioeconomy clearly proposes to develop synthetic biology technology, explore the research and development of new foods such as "artificial protein", and realize the iterative upgrading of the food industry. "In fact, many raw materials are manufactured through biotechnology, and the application scenarios are significantly broadened. Proteins, carbohydrates, fats and functional active ingredients will all have the opportunity to be produced with biotechnology innovation in the future to reconstruct the pattern of the upstream chain. ”
Zheng Di, Investment Director of Foodcore Capital.
Edible and medicinal qualities are naturally also an area favored by capital. In 2023, the National Health Commission will officially include 9 substances such as astragalus, codonopsis, and gastrodia into the list of edible and medicinal substances, and so far, China has released 3 batches of edible and medicinal substance lists, involving a total of 111 substances. At the same time of standardizing management, the National Health Commission also focuses on promoting the transformation and application of food and drug quality, and organizes the formulation of 8 food and nutrition guidelines, such as high blood pressure and high blood lipids, diabetes, growth retardation in children and adolescents, gout, kidney disease, children and obesity, so as to promote the masses to continuously deepen their cognition and understanding of food and drug quality and food culture. "In recent years, under the background of national policy support and further recognition of traditional culture by young people, China's edible and medicinal products have grown rapidly," Sun Dongxia, managing director of Shanghai Fosun Technology High (Group)**, pointed out. ”
She also said that in recent years, more and more healthy foods have begun to pay attention to subdivided groups, and products suitable for the elderly, infants, women, and sports groups have their own characteristics, but the attention of various brands to the middle-aged group is still insufficient. "This group is not only the pillar of society but also the pillar of the family, they care about their parents, their children, their work, but they forget to take care of themselves, and in fact, they also face many health problems including sleep disorders, obesity, waist and shoulder pain, etc. At present, this market demand has not been well met. ”
Sun Dongxia, Managing Director of Shanghai Fosun Technology High (Group)**.
Huang Jingou, Director of GL Capital.
In recent years, some traditional health food categories have been rejuvenated with the help of scientific research and popular science. Huang Jingou, director of Telford Capital, said that for example, probiotics initially focused on intestinal health, and later, their value in immune health and even mental health was gradually confirmed by scientific research; Fish oil was first used for cardiovascular protection, and it was later discovered that it may play a positive role in brain protection and even mental stability.
The convergence of "serious medical care and food technology" and "serious medical care and daily consumption" will create an attractive market space. Zhang Song, founding partner of Qingsong Capital, said that in the serious medical field, what makes people "love and distress" is the main payer of medical insurance, and if the product is expanded to non-medical daily consumption, "the market will be much larger"; The medical-grade standards and production processes are "reduced" to the field of daily consumption, which will greatly improve the accuracy and effectiveness of products, thereby opening up larger application scenarios. "In 2023, weight-loss health products can be said to be sold out, and the sales of related products of some international brands will reach tens of billions of dollars. This is the 'solution to consumer needs with medical technical standards'. It is foreseeable that health products that can play a role in anti-aging, anti-hair loss, muscle gain, etc., are presented with food as the carrier, and there is still a huge space for consumption. ”
Zhang Song, founding partner of Qingsong Capital.
From animal protein to plant-based protein and artificial protein, it is a good illustration of the importance that the global food industry attaches to sustainability. Jiang Weiming believes that in the future, whether it is food raw materials or carriers of functional ingredients, natural acquisition and biosynthesis may not only meet consumers' demand for reducing chemical synthesis, but also bring new investment growth points, and sustainable development will further become the goal of global pursuit.
Invest prudently and seize opportunities to avoid pitfalls
Healthy food is attractive and can be an opportunity, but it's a trap. When capital was full of ambition in the face of the chess game, Chen Junshi gave a kind warning. He said that the application of innovative technologies may attract attention in the early stages, but the industry should be cautious when investing, especially for some technologies that require long-term investment, and it is unrealistic to expect short-term returns. For example, the decline in the attention of plant protein around the world, as well as the high requirements for technical requirements and approvals of special medical foods, and the failure to enter the medical insurance catalogue so far, are all tests for the long-term development of related enterprises.
Zheng Di also said that based on the past investment accumulation, the insight of Food Core Capital is that it takes about 15 years to successfully commercialize a new functional raw material, of which 5 years are for technical research and 5 years for commercial mass production, and the real commercial value is verified and reasonable market pricing is obtained, and it is another 5 years. Regulatory uncertainty makes the overall cycle and the probability of success even lower. "However, although 5 years is a long time, compared with the consumer side's verification of products, which is relatively certain, consumer demand is the biggest uncertainty. Zheng Di took plant-based protein as an example and pointed out that it had set off a global boom and competed for capital, and it was in the limelight for a while. But many companies have basically lost 90% of their market value after going public. Two of the most well-known of them, as listed consumer goods companies, have reached sales of 400 million to 500 million US dollars, but have never achieved profitability, which is very abnormal, these two companies have also entered China, but the market demand has not opened. "So, we want to invest in ingredients that have a 'gold standard', or the kind of ingredients that the human body contains but need to be supplemented, and to a certain extent, consumer education can take a little shortcut. ”
When it comes to companies, the companies that Foodcore Capital favorites "need to have very strong potential in terms of awareness and ability, not just innovate in technology." After all, technology is only a means, and in the end, it is necessary to return to the logic of products and manufacturing. Zheng Di took biotechnology companies as an example to further explain that in terms of commercializing new raw materials, in addition to technical research, the follow-up global patent layout, regulatory registration and mass production are the core competencies that the company needs to have.
At present, the global biomanufacturing industry is facing the burst of the bubble and the trend of mergers and acquisitions, some companies with a high level of technology and heavy scientific research often encounter severe challenges in commercial mass production, mainly due to the fact that the whole Europe and North America do not have the advantages of the whole biomanufacturing industry chain, especially in Europe, although there is a lot of fermentation capacity but the cost is high, and the United States is strategically moving a lot of production capacity to South America, Southeast Asia and even China, and the integrity of the chain is not as good as China. China accounts for 70% of the world's production capacity in fermenting amino acids and vitamins, and has a very cost-efficient process technology and level. "For Chinese companies, this will be a good time to take advantage of infrastructure to find relatively low-cost R&D capital around the world to make up for the shortcomings of upstream system R&D. Zheng Di said, "For Chinese manufacturers with high technology level and production capacity and interested in R&D to achieve transformation, Food Core Capital is very willing to use the power of capital to promote the integration of resources." ”
Fei Hongtao, general manager of China Food Anxin (Beijing) Information Consulting, reminded investment risks from the perspective of laws and regulations. He suggested that investors should follow up the changes in relevant terms in a timely manner on the basis of fully understanding the laws, regulations and standards in the food field, and focus on product labeling and functional claims to prevent violations from adversely affecting the development of enterprises.
Fei Hongtao, general manager of China Food Anxin (Beijing) Information Consulting.
Attached: Two ** news
*Note: During the forum, a roundtable discussion moderated by Zhu Siming, a global partner of Nomura Research Institute, with the theme of "Technology-Driven and Innovation in the Health Food Industry", included the heads of Jiahe Food, Baihe Shares, Shanbainian, Chenrui Capital and Wen's Capital.
*Note: The roundtable discussion hosted by Qi Yuqian, executive general manager of Huatai United ** Large Consumption Industry Department**, discussed the "Strategy and Choice of Health Food Enterprises in the New Stage", and the guests included the heads of Tomson Beijian, Yixintang, Yongan Pharmaceutical, Huaxu Biotechnology, and Shanghai Beiyingli, covering all aspects of the whole industry chain of raw materials, channels, manufacturing, and brands.