Very few industries globally can boast such a double digit compound annual growth rate. This reflects the growth achievement across the entire industry supply chain and all supporting sectors from raw material suppliers to natural health practitioners. Every sector of the supply chain outpaced the 1.7% growth rate of the broader Australian economy, representing an increased share of national income deriving from our industry.
The highlights in this latest comprehensive industry audit clearly show that the Australian complementary medicines industry is in exceptional health as individuals continue to invest in their wellbeing. Here are some key stats:
- $4.7 billion complementary medicines industry revenue, having doubled from $2.3 billion in just three years
- Exports have doubled over the last three years
- The vitamin and dietary Supplement category has doubled over the last ten years
- There are now 82 TGA licensed manufacturing sites in Australia
- 12,700 direct high skilled jobs in complementary medicine products industry
- 36,441 employees across 29 natural therapy modalities
The industry has been a success story in recent years due to increasing interest and demand from consumers, both in Australia and internationally. Australian consumers use complementary medicines for preventive health or as an adjunctive therapy to conventional medicine. The vitamin and dietary supplement category, in particular, is in great demand, with sales doubling in the last decade.
Australian consumers spent over $AU550 per capita on complementary medicines in 2016, which has increased from $AU472 over the past five years. For the domestic market, two significant trends are supporting the growth of the industry – an ageing population and increase in chronic disease, and the growing awareness of the importance of preventive health. Whilst the older population is expected to remain a key driver of the market, the industry is also seeing growth in the youth market, especially in the area of sports nutrition.
Pharmacies and para pharmacies, where consumers can obtain professional healthcare advice from the pharmacist and in-store health professionals, remain popular outlets to purchase complementary medicines in Australia. It comes as no surprise, however, that online shopping is the fastest growing purchasing channel, with an 18.9 per cent growth over the 2015-2016 period.
The industry is seeing a new trend in the market. Consumers are seeking ‘clean-label’ complementary medicines, with the same trend being seen in the food and beverage markets. Consumers are becoming more savvy and conscious about what they put into their mouths. They want to know if products contain any allergens, such as wheat, soy or dairy, or any artificial chemicals such as colours, sweeteners or flavours, or GMOs. With this new trend, raw material suppliers and manufacturers are under pressure to ensure they meet consumers’ demand for ‘clean’ products.
Many are aware of Australia’s recent complementary medicine export boom. Over 60 per cent of Australian complementary medicines companies are involved in exporting. More than half of these exports are destined for mainland China and Hong Kong, with the top five export countries sitting in the Asia-Pacific region. There is continued healthy demand for Australian products, driven by the industry’s reputation for products that are recognised as setting the highest standards of quality and safety.
An innovative ndustry
The Australian regulator, the Therapeutic Goods Administration (TGA) has recently approved the inclusion of many new ingredients to the List of Permissible Ingredients. In the Therapeutic Goods (Permissible Ingredients) Determination No. 2 of 2016, 38 new ingredients, along with associated requirements relating to their use, were added to the list. Over the last three years, greater than 100 new active and excipient ingredients have been added to the approved list, allowing the industry to innovate further and formulate new products to meet consumer demand.
Australia is proud to be a global leader in complementary medicines research, boasting two five-star Australian Research Council recognised institutions for complementary medicines: the National Institute of Complementary Medicines (NICM) and the Australian Research Centre in Complementary and Integrative Medicine (ARCCIM). Australia also boasts notable research organisations outside of the university sector, such as the Blackmores Institute, the National Institute of Integrative Medicines (NIIM) and the Practitioner Research and Collaboration Initiative (PRACI).
In 2016, total research funding for our industry was $AU31.3 million, spanning over 295 research projects and 428 research staff, overseen by 160 chief investigators. Two major projects that are currently being pursued, and that have the ability to significantly expand the evidence base of complementary medicines, are the construction of the Westmead–NICM laboratories and the new dedicated clinical trails centre at La Trobe University.
As highlighted by the 2017 industry audit, the Australian complementary medicines industry continues to be in an excellent position to contribute to the growing domestic and international markets, as well as to provide significant economic and health benefits for Australia.
Carl Gibson is ceo of Complementary Medicines Australia, the peak industry body for the Australian complementary medicines industry.