Feeling a migraine coming on? Instead of reaching for an aspirin, how about a cup of soothing herbal tea? How about a bowl of cinnamon soup to lower your blood pressure?
The move away from modern medicine towards traditional, alternative, medicine, that is, ways of protecting and restoring health that existed before modern medicine appeared, is an emerging trend. According to the World Health Organisation, there has been a growing interest in tradition and alternative medicines in the past decade in many developed countries. Seventy-four per cent in the United Kingdom want alternative medicine included in the national health service, one third of American adults have used alternative treatments and there are 1,400 herbal drugs in use within the European Union. In China, herbal preparations account for 50% of total medicinal consumption or as much as US2.5 billion.
Statistics like these are fuelling the nascent growth of the herbal industry in Malaysia. Nasuha Kasian anticipated the move towards alternative treatments when he started Nasuha Enterprise 20 years ago. Nasuha initially imported herbs into Malaysia to make herbal essences, which he then packaged and sold locally and to Singapore and France. Three years into the business, a supply shortage made him consider other supply chains.
He planted 40 species of herbs and other medicinal plants and soon discovered that they could thrive in Malaysia. From that initial foray into herbal farming, Nasuha Enterprise has emerged as the country's largest producer of herbs, with more than 130 species grown on its 1,000-hectare plantation in Pagoh, in the Malaysian state of Johor.
It is a lucrative business. Essence from herbs and spices are used by the cosmetics and pharmaceutical industries. "The price of cinnamonum zeylanicum essence is between M$5,000 (US$1,315) and M$6,000 a kilogram compared with M$25 per kilogram in bulk for cinnamon," Nasuha says. But he admits he has spent are large amount on research and development (R&D) - too much to reveal, he says.
Among the changes that resulted from the R&D are modifications of the herbs to local tastebuds. "Spices like bay leaf and rosemary leaf can be too strong for Malaysians". Nasuha has also enriched soil conditions to produce longer roots on the herbs and spices, which in turn produces healthier plants and bigger extract yields.
Despite being a well-known name in Malaysia, Nasuha bemoans the fact that there is no government policy to support the industry. His application for a M$7.5 million loan from the Malaysian Technology Development Corporation (MTDC) was rejected. "Normally, after 20 years in business, you can list your company, but I'm still funding my business myself."
Last month, the company expanded its product lines with eight types of herbal teas and eight types of herbal soup, which will be exported to the US and Europe. Although Nasuha declined to divulge anticipated revenues from the new products, he says he has enough orders to fill four containers.
Subhas Kannan of Oze Marketing believes there is a "massive" market for herbal products in Asia as well as in Europe and the US. "Even as early as two years ago, (Malaysian) government statistics clearly showed that sales of natural medicine outstripped allopathic medicine. Today, the gap is widening because people don't want the side effects of allopathic medicine." Kuala Lumpur-based Oze Marketing imports Ayurvedic treatments from India and sells them through distributors in Malaysia, the Philippines, and Thailand. The company expects its turnover to increase 10-fold to M$50 million by year-end due to the growing interest in alternative treatments. "We're looking at expanding into New Zealand, Vietnam, the Middle East, Hong Kong and [mainland] China this year," says Subhas.
Oze Marketing began in 1997 after Subhas and two friends read an article about a memory product that was selling out in India. Coincidentally, a friend in Malaysia happened to know the Indian manufacturer of the product and a deal was soon struck between the two parties. Since then, Subhas has become a savvy marketer and strategist, while his partners manage the distribution relationships and the import logistics.
Rather than spend time building its own distribution chain, the company has created loyal relationships with key players in Malaysia whose niche markets allow Oze's products to enter the mainstream effortlessly.
For example, "Though we don't understand why, we have realised that Indians are reluctant to walk into a pharmacy," says Subhas. It is easier to sell Indian products to Indians through an Indian outlet. And one distributor handles the Indian market and a few Malay outlets, which amount to over 600 outlets." Another distributor sells to all the pharmacies and doctors in Peninsular Malaysia, while a different distributor manages the East Malaysian market.
"As the market leader in Malaysia, Indian manufacturers want us to carry their product," Subhas says. "However, our success is due to the importance of safety and then efficacy. We tend to reject nine out of 10 products."
Oze's current eight products include a diabetes treatment, an asthma reliever, a product to increase the production of breast milk in lactating mothers, and a memory enhancer.
Subhas says: "We are very careful to substantiate our claims because we consider Ayurvedic medicine to be from the Gods." Oze's products transcend Malaysia's multicultural and multiracial races. "We have a large following among the Chinese; they're prepared to take anything if the efficacy is there."
Oze Marketing spent more than M$1 million the first year and continues to invest heavily in advertising, mainly in radio campaigns, to introduce new products. But mostly, its products sell through reputation. "Basically, the two frequently asked questions are: 'Where can I get it?' and 'How do you spell it'?" he says.
The industry seems to be recession proof. "Whether the economy is doing well or not, people still fall ill," Subhas points out matter-of-factly.
He learned a valuable marketing lesson in 1997 when Oze introduced Memoplus, its memory enhancer treatment. "In a downturn, people won't spend unless there is a need. So we marketed to parents, emphasising Memoplus' proven qualities as a memory booster. Sales shot up when parents bought the product to help their children study for exams."
The genial entrepreneur says the business is not about money alone, but about commitment - to customers and distributors. "When you have a product like this, you must have a clear set of principals," Subhas says. "We don't over claim the product's qualities and we don't over price." The continual emphasis on product safety and effectiveness is the reason he isn't concerned about competition. But he acknowledges the increasing number of companies cashing in on the trend. "When we started importing Ayurvedic products, it took three months to register the items. Today, it can take more than a year because there are so many products vying for entry."
Pockets of resistance exist, especially among medical practitioners. "People used to think the world was flat," says Professor Chandra Shekhar of University Malaya Hospital. "It's the same type of paradigm change we're dealing with. Because certain diseases are considered incurable, if I say that after taking a herbal medicine, someone in the early stages of a certain illness no longer shows manifestations of the disease, and therefore can be said to be cured, my colleagues laugh at me."
However, the veteran shrugs off the sceptics, quoting results that he says have been duplicated time and time again in different studies. "I tell (my colleagues) to get their facts right." According to Dr Chandra, the facts are that the results of clinical trials prove that herbal products are effective.
However, while he is unafraid to use the term, "medicine", when talking about herbal products, Subhas and Nasuha prefer to refer to "preventive treatment" to cover their products.
Oze's biggest problem with entering new markets is the time-consuming process of registering its products. While some countries like Malaysia have a government department and policy that cover traditional medicine, most countries would categorise herbal treatments as either food or drugs.
Subhas says ayurvedic products have withstood the test of time as the ingredients are common herbs whose use date as far back as 73,000 years.
However, there is no one international standard of legislative control for herbal medicines. Hence, different approaches have evolved with regard to licensing, dispensing, manufacturing and distribution of alternative medicines.
Sharif Ahmad, chairman of the Herb Society of Malaysia says that UN studies project that the volume of trade for herbal products will be US$3 trillion by 2050. "Malaysia should develop and grow its own raw material," Sharif says, citing the country's rich and largely unexploited bio-diversity.
According to Sharif, Malaysia could become a major supplier of herbs within the next five years. "It depends how we go about it," he explains. "India has been successful with its herbal industry because the Indian government has provided policy and monetary support. The beauty of this industry is that SMEs can be very involved. You don't need a big amount of material because this is a niche market. SMEs can develop a specialised product during the nascent stages of the industry and grow with it."