According to Hau Giang Pharmacy, functional food brought VND228 billion in turnover to the company in 2015, or 6.3 percent of total revenue.
The 2014 financial report of the company showed that 15 out of its 18 subsidiaries traded functional food.
Pham Thi Viet Nga, CEO of Hau Giang, once stated that the proportion of revenue from functional food of the company, one of the three biggest pharmacy manufacturers, would increase from 8 percent to 15 percent in the years to come.
Hau Giang plans to focus on making functional food products from famous traditional herbs.
Meanwhile, Traphaco stated it will continue focusing on research and development of supplementary products for brain and liver. Traphaco has been very successful with two products which alone bring turnover of VND200 billion a year.
Traphaco’s 2015 shareholders’ meeting approved a plan to increase investment capital in the factory in Hung Yen province to VND420 billion instead of VND300 billion as initially planned.
|Nearly all pharmaceutical manufacturers have been or are planning to produce functional food because of the lucrative market.|
The strong advantage of Traphaco is that besides the two GMP-WHO factories in Hung Yen province and Hanoi, it also has herb growing areas in Nam Dinh and Sa Pa. In Traphaco’s product structure, 20 percent is western medicine, while 80 percent is oriental medicine.
A series of other Vietnamese pharmacy companies, such as Nam Duoc, Dong Tay, Sao Thai Duong, Domesco Dong Thap, IMC and ADC Pharma, also have poured money into functional food production lines.
Vu Thi Thuan, president of Traphaco, commented that the appearance of oriental medicine on TV every evening shows the stiff competition in the market. As functional food can be easily made, easily copied and sold well, the market is attractive to farmers.
According to Nguyen Thanh Phong, head of the Food Safety Agency, there are about over 3,000 functional food manufacturing and trading establishments. Sixty five percent of products available in the market are made domestically, while the remaining are imports.
In 2015, the agency released the decision on imposing a fine of VND4.7 billion on 262 companies which violated regulations in food safety. In the first four months of 2016, the agency imposed a fine of VND300 million on 15 violators.
The figures, as commented by an analyst, partially showed the chaos of the functional food market. Though functional food is not a kind of medicine, many products are advertised as if they are medicine which can cure disease.
Nguyen Van Liem, the advisor to Jadovie JSC, said that only one percent of manufacturers ‘have sufficient knowledge about functional food’.