The domestic health functional food (HFF) market is rapidly expanding, prompting not only pharmaceutical and biotech companies but also businesses from various industries to competitively enter the sector.
As HFF distribution channels extend to stores like Daiso and convenience stores, market competition has become even more intense.
According to industry sources on the 16th, Huons Group plans to separate its HFF division in May and merge it into its subsidiary, Huons Foodience. This move aims to specialize its HFF business and enhance research and development as well as marketing capabilities.
Huons Foodience manufactures and sells a variety of HFF products, including ginseng, red ginseng, probiotics, and vitamins. The restructuring is expected to further strengthen its competitiveness.
Similarly, Handok decided at its board meeting in February to spin off its food and HFF business division to establish a new company. Once the business separation is completed on May 1, the newly established "Handok HFF Business Corporation" will take charge of this segment.
Handok aims to build a system that enables swift and specialized decision-making, thereby enhancing its corporate competitiveness.
Shinshin Pharmaceutical is also considering expanding its business scope to include HFF manufacturing and sales, as discussed at its regular shareholders’ meeting. This shift is seen as a strategic move to capitalize on the growing domestic HFF market.
According to the Korea Health Supplements Association, the domestic HFF market, valued at approximately 5 trillion KRW in 2020, grew to 6.044 trillion KRW by 2023.
The association has set a goal to expand the market size to 15 trillion KRW by 2035. The expansion of distribution channels, such as Daiso and convenience stores, has increased consumer accessibility.
CU was the first in the industry to introduce HFF products and exclusively sells Dong-A Pharmaceutical’s "Vitagrand" and "Ailo Kamut Enzyme." Meanwhile, Daiso has been attracting consumer interest by offering affordable products from companies like Chong Kun Dang Health and Daewoong Pharmaceutical, priced between 3,000 and 5,000 KRW.
However, some pharmacists have expressed concerns that HFF products sold at Daiso are cheaper than those available in pharmacies, potentially causing consumer confusion. Due to such concerns, Il-Yang Pharmaceutical decided to withdraw its products from Daiso, leading to controversy.
As the HFF market expands, not only pharmaceutical companies but also businesses from various industries are entering the sector. Digital healthcare company SCL Science plans to add HFF sales to its business objectives at its shareholders’ meeting, while jewelry brand J.ESTINA is also venturing into HFF manufacturing and sales as a new business initiative.
An industry insider advised, "Rather than simply comparing prices, consumers should carefully examine the origin of ingredients, their content, and efficacy. With the expansion of distribution channels, it is important for consumers to focus on the ingredients and effectiveness of products rather than just the brand.
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Rapid Growth in the HFF Market… Fierce Competition Among Pharmaceutical, Retail, and Fashion Industries
The domestic health functional food (HFF) market is rapidly expanding, prompting not only pharmaceutical and biotech companies but also businesses from various
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