North America And Europe Medical Foods Market Size, Share & Trends Analysis Report By Route of Administration, By Product Type, By Payment Scheme, By Application, By Sales Channel, By Region, And Segment Forecasts, 2021 - 2028

Report Overview

The North America and Europe medical foods market size was valued at USD 11.5 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 4.3% from 2021 to 2028. Some of the drivers of the market are the rising geriatric population, the increasing prevalence of chronic diseases, and the growing focus of policymakers on the management of malnutrition. As per the data published by Population Reference Bureau in July 2019, the number of Americans aged 65 years or more is projected to double from an estimated 52.0 million in 2018 to 95.0 million by 2060.

The overall population age group share is anticipated to increase from 16.0% to 23.0%. Dietary management of chronic diseases and rare disorders is an emerging focus area for manufacturers of medical foods, which is also positively impacting the market growth. Patients suffering from chronic and infectious diseases such as tuberculosis, hepatitis, cancer, pneumonia, diabetes, and other neurological disorders develop nutritional deficiencies owing to adverse effects of the disease or drugs that are used for the treatment. Medical foods play a vital role in addressing these nutritional deficiencies as part of the overall treatment regimen, thus boosting their consumption.

The geriatric patient population suffering from neurological health disorders, such as stroke, multiple sclerosis, and dementia, which causes difficulty in swallowing, is the biggest target population for the market for medical foods in North America and Europe. This, in turn, has bolstered the adoption of medical foods for providing adequate nutritional support and mitigating the challenges of nutrition deficit among patients diagnosed with these conditions through enteral nutrition feeding tubes and oral nutrition supplements. Moreover, high unmet needs in developing North America and European countries with lucrative growth opportunities are expected to drive manufacturers to expand into these regions.

COVID-19 North America and Europe medical foods market impact: 8.3% increase in revenue growth from 2019 to 2020

The COVID-19 pandemic has increased the adoption of medical foods. The rise in the prevalence of the underweight population has boosted the adoption of medical foods as the undernourished population has a weak immune system and is highly prone to severe illness due to the virus. According to the data published by CDC in December 2020, an estimated 1.6% of adults aged 20 and above are underweight in the U.S. Medical foods, along with enteral feeding have been opted for as the primary choice for delivering adequate nutrients to malnourished patients for combatting the threat of the pandemic. On the other hand, as per Global Nutrition Report 2020, poor metabolic health, including diabetes and obesity, is strongly linked to worsening the outcomes associated with COVID-19, including the risk of hospitalization and ultimately death.

The rising prevalence of diabetes and malnutrition is further propelling the growth of the market for medical foods in North America and Europe. For instance, as per the data published by CDC in February 2020, around 34.2 million Americans were living with diabetes. OECD further reported around 32.3 million adults were diagnosed with diabetes as of 2019 in the European Union. These formulations help to alleviate the symptoms of diabetic neuropathy, which is one of the most common complications in diabetic patients.

Furthermore, an increase in the number of initiatives being undertaken to drive the adoption of medical foods and curb the incidence of disease-related malnutrition is anticipated to positively contribute to the growth of the market for medical foods in North America and Europe. For instance, in February 2019, Ajinomoto Cambrooke, Inc. (formally known as Cambrooke Therapeutics, Inc.) announced a strategic alliance with Trovita Health Science for marketing as well as the development of ENU Nutrition meal replacement products. This partnership emphasizes reducing malnutrition and managing weight loss in individuals suffering from chronic diseases such as cystic fibrosis and cancer. The Canadian Malnutrition Task Force has developed a 2018-2023 strategic plan to introduce best practices for nutrition care in Canada through collaborations and research. Such initiatives are expected to positively impact the growth of the market for medical foods in North America and Europe.

Route of Administration Insights

In 2020, the oral route of administration segment dominated the market and accounted for the largest revenue share of 70.4%. Increased preference for orally administered products, commercial viability, and supportive initiatives are key factors driving the demand for orally administered medical foods. As per data published by the British Specialist Nutrition Association Ltd., the provision of prescribed oral nutritional supplements to malnourished patients reduces the risk of infections by 70% and mortality by 40%. The use of oral nutrition supplements has led to a decline in hospital stays, which results in significant cost savings. For instance, the use of oral nutrition supplements has resulted in cost savings of USD 131.15 million (£101.8 million) annually in England.

The enteral segment is anticipated to register the fastest growth during the forecast period. The rising prevalence of target diseases and technological advancements in allied markets, such as enteral feeding devices, are expected to propel the demand for enteral medical foods. Enteral feeding formulas are developed to suit the nutritional requirements of pediatric patients, adults, the geriatric population, and pregnant women. The U.S. FDA and the EU commission directives regulate the manufacturing and quality standards of these products. Moreover, key players are launching new products that can be administered through an enteral route, thereby propelling the growth of the market for medical foods in North America and Europe. In June 2018, Otsuka Pharmaceutical Factory, Inc. announced the launch of Racol-NF Liquid for Enteral Use, which consists of all the essential nutrients. The product is intended to be consumed for long-term nutritional management.

Product Type Insights

In 2020, the others segment dominated the market for medical foods in North America and Europe and held the largest revenue share of 51.8%. The segment includes liquid, semi-liquid, and semi-solid products, and its highest market share is attributed to factors that include high commercial availability of the products, new product launches, and increasing preference for liquid formulations among pediatric and geriatric population owing to ease of swallowing offered by these products. Some of the liquid formulations available in the market include Glucerna (Therapeutic Nutrition Shake) by Abbott, Nutrison MCT, Nutrison Energy, Nutrison Soya by Danone, and Novasource by Nestle.

On the other hand, the powder segment is anticipated to register the fastest growth during the forecast period. Its rapid growth can be attributed to the growing preference for these products owing to ease of administration and convenience in consumption. Increasing product launches is further anticipated to drive its adoption in the forthcoming years. For instance, In April 2017, Vitaflo USA announced the launch of PKU Sphere, which is a powdered and low-phenylalanine medical food. The product is intended for the management of Phenylketonuria (PKU) and became the company’s first Glycomacropeptide (GMP)-based medical food that contains a balanced mix of amino acids and GMP.

Payment Scheme Insights

In 2020, the non-reimbursed payment scheme segment dominated the market for medical foods in North America and Europe and held the largest revenue share of 83.3%. Although the demand for medical foods is significantly growing in North American and European countries, there is a prominent shortage of reimbursement coverage from healthcare payers in the U.S. and European Union. Discrepancies in the definitions of medical foods and unavailability of firm reimbursement regulations are the major factors supporting the segment growth. In addition, the lack of stringent regulatory standards for medical food approval is leading to the absence of clinical evidence, which in turn, results in poor reimbursement payouts from healthcare payers and higher out-of-pocket expenses for patients.

However, the reimbursed payment scheme segment is anticipated to register the fastest growth during the forecast period. The introduction of effective reimbursement policies, especially in-home healthcare centers, is expected to boost the adoption of medical foods. For instance, the European Innovative Health Initiative (IHI) was started by the European Nutrition of Health Alliance (ENHA) in 2018 to address malnutrition in the elderly population. The ENHA started a campaign called Optimal Nutritional Care for all to develop nutrition care solutions across Europe. According to a survey published by NCBI in 2017, Home Enteral Nutrition (HEN) is fully funded by private and public payers in the U.K., Spain, Italy, Germany, Ireland, and Switzerland. In Denmark and Belgium, the reimbursement is nearly 60% and 30%, respectively. These aforementioned factors are supporting segment growth.

Application Insights

In 2020, the other diseases segment including Parkinson’s disease, Epilepsy, pain management, and other cancer-related treatments held the largest revenue share of 21.6%. The increasing prevalence of these health disorders is driving the adoption of medical foods to supplement dietary requirements and enable faster recovery of patients. As per the data published by Parkinson's Foundation, around 1.0 million people with Parkinson's disease (PD) were residing in the U.S. This number is significantly higher in comparison to the combined population of the country that is diagnosed with muscular dystrophy, Lou Gehrig's disease, and multiple sclerosis. In addition, the disease prevalence is anticipated to increase to 1.2 million by 2030.

The diabetic neuropathy segment is anticipated to register the fastest growth during the forecast period. An increase in the prevalence of diabetes and a rise in the number of patients that are at risk of developing some level of neuropathy are key factors contributing to the largest revenue share. According to the article published by Healthline in February 2020, an estimated 48.0 million people are anticipated to be diagnosed with diabetes by 2050. In addition, an increase in the number of initiatives that are being undertaken for the dietary management of diabetes is further anticipated to bolster market growth.

Sales Channel Insights

The institutional sales channel segment dominated the North America and Europe medical foods market and held the largest revenue share of 42.0%in 2020. This is owing to the high consumption of medical foods for chronic disease management, primarily influenced by healthcare institutes such as hospitals, clinics, and care centers. Moreover, key players majorly rely on institutional sales channels through a group of sales representatives who sell directly to the healthcare institutions and physicians. This, in turn, is contributing to segment growth.

The online sales channel is anticipated to witness the fastest CAGR during the forecast period. The rise in the preference for online purchasing of medical foods owing to the COVID-19 outbreak coupled with the convenience offered by this sales channel leading to consumer dependency on these sales channels to avoid traveling is aiding segment adoption. Although consumed under medical surveillance, these products are intended for long-term nutrition management, resulting in growing sales through e-commerce. Thus, increasing penetration of e-commerce is shifting the consumer preference towards online purchase of medical foods, thereby offering lucrative market opportunities.

Regional Insights

North America dominated the market for medical foods in North America and Europe and accounted for the largest revenue share of 52.5% in 2020. The region is anticipated to witness the fastest CAGR during the forecast period. The key factors contributing to the highest revenue share include the presence of significant market players and the high revenue generated by these players in this region. In addition, the rising prevalence of chronic diseases, malnutrition, increasing number of new launches, and the pipeline of the U.S. FDA are factors driving the market in the region. The number of cancer patients in North America is increasing with cancer being one of the leading causes of mortality in the U.S. As per the statistics published by American Cancer Society, Inc., an estimated 1.9 million new cancer cases were anticipated to be registered in 2021.

Europe, on the other hand, has a very large elderly population, which is at a high risk of various diseases, such as cardiovascular, respiratory, and other chronic diseases. According to data published by European Cardiovascular Disease Statistics 2017, cardiovascular diseases account for more than 1.8 million deaths in the EU and nearly 3.9 million deaths in Europe each year. The rise in the number of malnourished and underweight people is expected to boost the demand for medical foods (also referred to as foods for special medical purposes). According to Specialised Nutrition Europe, 40% of adult hospital patients in the EU are malnourished. The economic burden of malnourishment is estimated at USD 136.8 billion (EUR 120 billion) across Europe.

Key Companies & Market Share Insights

The key players are adopting several strategies for increasing their market shares. Geographic expansion, mergers and acquisitions, development of new products, and high investments in R&D to develop disease-specific formulas are some of the strategies being implemented by market players. For instance, In April 2021, Nestle acquired the core brands of The Bountiful Company for USD 5.75 billion. Through this acquisition, Nestle strengthened its product portfolio by addition of Nature’s Bounty, Osteo Bi-Flex, and several other high-growth brands of The Bountiful Company as well as their U.S. private label business. Key players are also collaborating with policymakers to address the issue of malnutrition in the country. Some of the prominent players in the North America and Europe medical foods market include:

• Danone

• Nestle

• Targeted Medical Pharma, Inc.

• Abbott

• Primus Pharmaceuticals, Inc.

• Medtrition, Inc.

• Mead Johnson & Company, LLC

• Fresenius Kabi AG

North America And Europe Medical Foods Market Report Scope

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2028. For the purpose of this study, Grand View Research, Inc. has segmented the North America and Europe medical foods market report on the basis of route of administration, product type, payment scheme, application, sales channel, and region:

• Route of Administration Outlook (Revenue, USD Million, 2016 - 2028)

  • Oral

  • Enteral

• Product Type Outlook (Revenue, USD Million, 2016 - 2028)

  • Pills

  • Powders

  • Others

• Payment Scheme Outlook (Revenue, USD Million, 2016 - 2028)

  • Reimbursed

    • Diabetes

    • Chronic Kidney Disease

    • Other Applications

  • Non-reimbursed

    • Diabetes

    • Chronic Kidney Disease

    • Other Applications

• Application Outlook (Revenue, USD Million, 2016 - 2028)

  • Chronic Kidney Disease

  • Minimal Hepatic Encephalopathy

  • Chemotherapy Induced Diarrhoea

  • Pathogen Related Infections

  • Diabetic Neuropathy

  • ADHD

  • Depression

  • Alzheimer's Disease

  • Nutritional Deficiency

  • Orphan Diseases

    • Phenylketonuria

    • Eosinophilic Esophagitis

    • FPIES

    • Others

  • Wound Healing

  • Chronic Diarrhea

  • Constipation Relief

  • Protein Booster

  • Dysphagia

  • Other Diseases

    • Parkinson’s Disease

    • Epilepsy

    • Pain Management

    • Other Cancer Related Treatments

• Sales Channel Outlook (Revenue, USD Million, 2016 - 2028)

  • Online Sales

  • Retail Sales

  • Institutional Sales

• Regional Outlook (Revenue, USD Million, 2016 - 2028)

  • North America

    • U.S.

    • Canada

  • Europe

    • U.K.

    • Germany

    • France

    • Italy

    • Spain

    • Russia