France is a leading destination for investment in the nutraceutical and functional-food industry. This new sector combines the traditional agri-food, cosmetics and pharmaceutical industries. The French functional-foods market was valued at €900 million in 2006, with an estimated annual growth rate of more than 10%.
The global market for functional foods is currently estimated at more than €100 billion, which is roughly 5% of the total agri-food industry market. According to an Ipsos survey published in October 2007, 52% of French consumers are concerned about the effects on their health of the food they eat. The market for foods developed specifically for their health benefits is growing dramatically.
Several of France’s 71 pôles de compétitivité (clusters of excellence located all over France that specialise in specific industrial sectors) focus on functional foods. These include Nutrition Santé Longévité, which is based in Nord Pas-de-Calais, Prod’Innov in Aquitaine, Vitagora in Burgundy, and Qu@limed in Languedoc-Roussillon.
The French government supports research activities through an R&D tax credit that is currently the best of its type in Europe. This credit reimburses up to 50% of R&D expenditure for the first year (up to €100 million), 40% in the second year and 30% in subsequent years.
Some of the innovative projects that are currently being developed in this sector involve Danone and Lactalis, which are at the forefront of innovation in the €400-million bioactive dairy-products sector, with products such as Danone Actimel yoghurt. Japanese and US companies also have an important market presence. Shiseido is developing an anti-wrinkle yoghurt with aloe vera, while Knorr (Unilever) has launched Knorr Vie (a fresh fruit and vegetable drink) and the Proactive range of yoghurts and drinks, which reduce cholesterol, according to the company.
Pharmaceutical laboratories are also actively developing nutraceutical products in France. The list includes specialised SMEs such as Arkopharma, which is developing plant-based products, and Juva-santé, with its Juvamine beauté vitamin complex. Food supplements rely on technology and innovation from the pharmaceutical or cosmetics industries, which leads to cross-industry partnerships. Nestlé and L’Oréal have, for example, created the Innéov product line, specialising in cosmetic functional foods, while Novartis and Quaker Oats have created the Aviva line of dietary products.
“This sector offers high development potential, combining three industries in which France is particularly strongly positioned (agri-food, pharmaceutical and cosmetics) as the European leader in each of these sectors,” says Philippe Favre, Chairman and CEO of the Invest in France Agency.
Between 2002 and 2007, the functional-foods sector generated 200 new international investment projects (7% of the total) and created 9,610 jobs (5% of the total), according to statistics included in a recent Invest in France Report.
About the Invest in France Agency
The Invest in France Agency (IFA) promotes and facilitates international investment in France. The IFA network operates worldwide. IFA works in partnership with regional development agencies to offer international investors business opportunities and customized services all over France.
For more information about this press release, please contact Martin Hedges, Director of Communications at the Invest in France Agency in London: mhedges[.]investinfrance.org