By Len Monheit
A resource and capability-rich country, Canada, many would argue, has huge potential to contribute to the global health and nutrition industry. With a unique set of regulations governing natural health products, and a rather conservative environment at best where foods and functional foods are concerned, there are definitely domestic business and regulatory challenges, leading many companies to preferentially explore international opportunities - potentially leaving Canadian consumers on the outside looking in. In fact, it has been suggested that for Canadians, operating in the natural and nutritional products industry is much like being a rock star when it comes to acknowledgement. Only when you receive attention elsewhere do you gain credibility (or a voice) domestically.Fundamentally, these issues are part of the Canadian conundrum in an increasingly more global business environment.
Revisiting the Canadian Conundrum
- Population approaching 33 million
- Unemployment rate - 6%
- GDP growth 0.8% last quarter
- Largest Trading Partners - US followed by China (trade deficit of $27 billion)
- Regulatory Background – Natural health products used to be regulated by the drugs directorate. Products required registration through DIN (Drug Identification Number) process. Most products on shelves bypassed the process.
- Current Regulatory Environment – Natural Health Products (NHP) Directorate created. Pre-market approval of product composition, product label, and product claim required (claim mandatory). NHP-specific GMPs in force.
- Current Business Environment: Backlog in NPN registrations being worked through. Slow market growth.
- Cost recovery ambitions thwarted at least until backlog reduced/eliminated.
- Functional ingredient leaders based in Canada continue to look elsewhere for business opportunity and growth. Examples include Forbes Medi-Tech Inc., (phytosterols) and Ocean Nutrition Canada (marine source omega-3s) both of whom rely on export markets for the bulk of their growth potential, largely due to an unfavorable regulatory environment that restricts either claims or dosage relative to other regions of the world.
- Canadian companies continue to seek and gain entry into the most credible business environments in both dietary supplements / natural health products as well as functional foods and beverages, whether it is in Asia (Jamieson Labs, Ocean Nutrition Canada etc.), Europe (Forbes and Ocean Nutrition Canada) or into the United States (numerous companies). When global industry thought leaders gather, Canadians almost always number among them.
- Canadian researchers contribute proportionally at minimum (and some would argue even more) with highly competent research communities supported frequently by industry/government/academic collaboration. Analytical expertise and contribution internationally in this area is recognized as significant.
This coming week, the Canadian Health Food Association hosts CHFA Expo East in Toronto, an event that promises to be interesting from several standpoints with feature presentations from Phil Waddington, director general for the Natural Health Products Directorate, as well as a state of the organic industry address. One would presume that by the end of the weekend, attendees will have a much better idea of where the domestic realities and opportunities lie.
Ultimately though, it is really only through participation at out-of-Canada events that one truly appreciates the Canadian opportunity and conundrum. Walking into a room at the NBJ Newport Summit and observing the Canadian contingent, or congregating at IFT and sharing domestic ‘war stories’ gives a person a much better idea of Canadian potential, and contributions thus far. And around numerous corners, there are expatriates, many of whom remain in contact with things Canadian and the attributes, behaviors and beliefs that frequently define us.
Has Canada realized on its opportunity to contribute to the global health and nutrition industry?
In key circles, do Canadian contributors have the respect of thought leaders, movers and shakers?
Aligning these two realities is definitely a Canadian conundrum.