HERBAL MEDICINAL PRODUCTS MARKET ANALYSIS

Global herbal medicinal product market size was valued at US$ 197.77 Bn in 2023 and is expected to reach US$ 344.89 Bn by 2031, exhibiting a compound annual growth rate (CAGR) of 7.2% from 2024 to 2031.

Global herbal medicinal products market has been witnessing steady growth over the past few years driven by growing consumer preference for herbal supplements and medicines. Herbal products are gaining popularity due to perceived effectiveness against diseases without any side-effects. Affordability of herbal medicines compare d to modern drugs is boosting their demand across developing regions. Factors such as increasing health awareness, rising incomes, and aging population are propelling the demand for herbal drugs. Moreover, innovation in delivery formats such as tablets and capsules are further enhancing the adoption of herbal products. However, inadequate regulation and standardization of herbal medicines pose challenges. 

Global Herbal Medicinal Product Market Regional Insights

• North America: North America is the second largest market for herbal medicinal products market, accounting for a share of over 23.5% in 2023, due to rising acquisition and collaboration strategies adopted by the market players in the region. Increasing adaption towards healthy lifestyle and rising living standards and influence of natural product and their benefits.
• Europe: Europe holds dominant position in the market, accounting for a share of over 33.1% in 2023, due to large pharmaceutical and medical industry in the region. Thus, major players in the market are penetrating potential European countries through strategic acquisitions and merger agreement.
• Asia Pacific: Asia Pacific is the fastest-growing market for herbal medicinal products, accounting for a share of over 20% in 2023. As herbs are easily available, in China and India, they are the major producers of herbal products in the world.

Figure 1. Global Herbal Medicinal Product Market Share (%), By Region, 2023

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Analyst view on Global Herbal Medicinal Product Market

The herbal medicinal products market has strong growth potential in the near future. A growing preference for herbal medicines over allopathic medicines is expected to drive the demand. Many consumers are switching to herbal medicines due to perceived natural properties and less side effects. This trend is expected to continue with increasing health awareness. Growth in beauty and personal care sector will support the demand for herbal ingredients. Expanding retail distribution and e-commerce channels are also making these products more accessible.

However, lack of scientific evidence, standardization, and quality control in many developing markets could hamper the growth. Long approval timelines and stringent regulations in developed countries as well pose challenges. The market may also experience fluctuation in raw material supply and pricing. Competition from conventional drugs represents a threat as well.

The Asia Pacific region, especially China and India, dominates the global market  due  to historical roots and acceptance. Many new market players are also emerging from these regions. North America is expected to witness steady growth due to complementing consumer trend towards natural products. Demand will be robust in Latin America and Middle East & Africa too, on back of improving access and living standards. Europe presents moderate opportunities due to stagnant population growth and pricing pressures in key markets. Overall, the herbal medicines market provides considerable opportunities for Contract Research Organization (CROs) and stakeholders to conduct research and support product development given its growth potential worldwide.

Global Herbal Medicinal Product Market Drivers:

• Increasing interest in holistic and natural therapies: There is a growing interest among consumers in holistic and natural approaches to healthcare. Consumers seeking alternative therapies and those looking to complement conventional medicine with natural remedies are driving the demand for homeopathic dilutions. For instance, in January 2022, according to an article published by Bio Med Central (BMC), a part of springer nature journal research article ‘Acceptance and use of complementary and alternative medicine among medical specialists’, aimed to identify relevant studies and synthesize survey data on the acceptance and use of complementary and alternative medicine (CAM) among medical specialists. The overall use of CAM was 45%, highest use of CAM was by the obstetrics and gynecology, followed by family medicine, psychiatry and neurology, pediatrics, otolaryngology, anesthesiology, internal medicine, physical medicine and rehabilitation, and surgery.
• Rising awareness about benefits of herbal and traditional medicines: Awareness and acceptance of herbal have been increasing in various regions. As more people become familiar with the principles and benefits of herbal medicines. Greater acceptance from healthcare professionals, increased availability of herbal medicinal products, and positive word-of-mouth experiences contribute to the growing awareness and acceptance of herbal medicinal products. In December 2022, according to an article by The Lancet Regional Health – Southeast Asia, ‘India and its pluralistic health system – a new philosophy for Universal Health Coverage’, there is growing awareness on traditional knowledge systems which can definitely contribute to higher acceptability and coverage among the population rather than relying solely on one system. According to the World Health Organization (WHO), 88% of all countries are estimated to use traditional medicine and about 40% of existing pharmaceutical formulations are based on natural products.

Global Herbal Medicinal Product Market Opportunities: 

• Untapped growth potential in emerging markets: Untapped growth potential in emerging markets could provide significant opportunities for expansion in the global herbal medicinal product market. Many developing countries have traditionally relied heavily on herbal medicines as part of their healthcare systems and culture. However, limited research and development as well as lack of standardization had prevented these markets from realizing their full commercial potential. For instance, according to 2022 data from the World Health Organization (WHO), India has set up over 200 institutes dedicated to teaching and research in Ayurveda, yoga, and naturopathy. Thailand's ministry of public health has approved over 1,500 traditional Thai formulae and China's government encourages exports of patented Chinese herbal medicines.
• Education and awareness campaigns: There is an opportunity to invest in educational initiatives and awareness campaigns to enhance understanding and acceptance of herbal medicinal products. Educating healthcare professionals, consumers, and the general public about the principles, efficacy, and appropriate use can foster greater acceptance and drive market growth. For instance, on August 10, 2023, World Health Organization (WHO) hosted first high-level global summit on traditional medicine to explore evidence base and opportunities to accelerate health. The next global survey on traditional medicine is designed to monitor the progress in the performance of traditional and complementary systems, to better understand their role, function and impact in countries’ health systems and to align with WHO and global monitoring frameworks.

Global Herbal Medicinal Product Market Trends:

• Rising popularity of ayurvedic and traditional Chinese medicines: The popularity of traditional healing practices like Ayurveda and traditional Chinese medicine has been on the rise globally in the early twentieth century, More people are looking to these ancient medical systems for their healthcare needs over conventional medications. This trend is having a significant impact on the herbal medicinal products market. For instance, On Jnauary 2023, according to World Health Organization (WHO), 88% of all countries are estimated to use traditional medicine, such as herbal medicines, acupuncture, yoga, indigenous therapies and others. Over 40% of pharmaceutical formulations are based on natural products and landmark drugs, including aspirin and artemisinin, which originated from traditional medicine.
• Advancements in herbal medicine manufacturing technologies: Advancements in herbal medicine manufacturing technologies are significantly influencing the global herbal medicinal product market. The emergence of new technologies is allowing manufacturers to develop herbal medicines in more precise, effective, and environment-friendly ways. For instance, in November 2022, according to an article published by Improved Activity of Herbal Medicines through Nanotechnology , nanotechnology is being used to encapsulate active herbal compounds and deliver them efficiently in the body. Microencapsulation technique helps protect unstable compounds from harsh environment. This ensures the compounds to retain their therapeutic properties for a longer duration. Another major technology is supercritical fluid extraction which uses supercritical carbon dioxide to extract compounds without using organic solvents. This makes extraction greener and yields higher quality compounds.                                                       

Global Herbal Medicinal Product Market Restraints:

• Issues with quality and consistency: Regulatory frameworks for homeopathic products can vary across different regions. Manufacturers and distributors of homeopathic dilutions need to navigate complex and evolving regulatory landscapes, including compliance with labeling requirements, quality control standards, and safety regulations. These challenges can create barriers to market entry and expansion. For instance, in December 2022, according to an article published by Current Trends in Toxicity Assessment of Herbal Medicines’ the toxicity of medicinal plants and herbal medicinal products is closely related to the presence of bioactive compounds in the plant material and their toxic potential. The issue is even more complicated when it comes to heterogenous, complex mixtures of herbs which can cause unpredictable effects. In the case of phytometabolites with proven toxic potential, the regulatory authorities responsible for the quality and safety of herbal medicines have imposed concentration limits.
• Counterbalance: However, there are many researches ongoing to inspect the safety and efficacy of herbal medicinal products and guideline given by herbal medicine research from national medical research.

Recent Developments

New product launches

• Kunnath Pharmaceuticals, a India based ayurveda and research company, involved in development and manufacture of high quality, result giving ayurvedic medicines and food supplements, launched Viromune antiviral immunity booster capsules
• TAMPCOL, a India based Ayurvedic and herbal medicine company, on July 2023, launched chemical free herbal based skin care product range

Acquisition and partnerships

• Patanjali Ayurved partnership with Tocklai Tea Research Institute: In 2021, Patanjali Ayurved, an India based multinational health and wellness product manufacturing company, announced a strategic partnership with Tocklai Tea Research Institute, Assam based oldest and largest tea research institute globally. The partnership aimed to research and extract chemical compounds from tea and tea leaves.
• Emami Ltd acquired Axiom Ayurveda: On September 2023, Emami Ltd, an India based global ayurvedic based personal care & healthcare products manufacturing company, announced acquisition of Axiom Ayurveda, a India based ayuverdic medicine and personal care manufacturing company. The acquisition will strengthen Emami’s product portfolio.

Figure 2. Global Herbal Medicinal Product Market Share (%), By Distribution Channel, 2023

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Top Companies in Global Herbal Medicinal Product Market

• Himalaya Global Holdings Ltd.,
• Arkopharma Laboratories
• Cultivator Natural Products
• Patanjali Ayurvedic India Ltd
• Herbalife International of America, Inc.
• Emami Ltd
• NUTRAMARKS, INC.
• Arogya Formulations (P) Ltd.
• Navayur Herbals
• Nature's Answer Inc. 
• 21ST Century HealthCare, Inc. 
• Bio-Botanica Inc.

Definition: Herbs are plants or plant parts that are utilized for their smell, taste, or medicinal characteristics.  Herbal medications or supplements are natural substances derived from the leaves, bark, roots, seeds, or flowers of plants that can be used for therapeutic purposes. Dietary supplements consists of herbal medications. Tablets, capsules, powders, teas, extracts, and fresh or dried plants are available. Herbal remedies are used by people to try to maintain or enhance their health.