Snake oil or panacea? Health supplements face a trust deficit; these startups hope to change that

“I changed my mind about supplements when my wife started using Metabolically Lean and lost 10kg in three months. It also sorted out her longstanding bloating issue,” said Chennai-based Javeed, who runs a business that offers the tech and hardware for digital screening of movies. He also started using Gut Cleanse this month.

Metabolically Lean, which promises a boost to metabolism, and Gut Cleanse, which are gut detox shots, are sold by The Good Bug, a supplement company.

“When you are stuck in a rut and the usual methods don’t work well, you turn to something like this,” Javeed said.

But 46-year-old marketing professional Ryan Frantz, who also lives in Chennai, had a different experience. He started consuming Metabolically Lean in August but stopped in October after finding no “discernible weight change.”

For Frantz, who had also been on other health supplements such as Omega-3, the leap of faith backfired. “My doctor diagnosed me with fatty liver and said it could be linked to my supplement intake. I was already doubtful about the whole thing, so I decided to stop it all,” he said.

India’s health supplements industry got a fillip after the onset of the covid-19 pandemic. Rising health awareness and a growing digital-first population willing to spend money to look and feel good have led to a surge in startups. On Instagram, users are bombarded with ads and influencer reels peddling vitamin gummies and “magic” powders from new-age direct-to-consumer (D2C) startups that promise results from a snatched (slender, hourglass-shaped) waist to baby-like sleep.

Consulting firm IMARC estimates the overall nutraceutical market’s size will reach $8 billion in 2025, while Tracxn data shows there are 478 active startups. Investments have poured in, with startups cumulatively raising almost $635 million across 222 funding rounds, including over $52 million this year.

Nutraceutical startups have cumulatively raised nearly $500 million in the last five years (Table)

In September, Ayurvedic nutraceuticals brand Kapiva announced a $28 million fresh capital infusion (the round also had a $32 million secondary component).

Consumer business giants have also entered the fray. In August, Reliance Industries acquired a majority stake in Naturedge Beverages, which sells functional beverage brand Shunya. Earlier, Hindustan Unilever and Marico had acquired majority stakes in plant-based nutraceutical brands OZiva and Plix, respectively.

The industry’s dynamism and investment, however, mask a significant hurdle—a market-wide trust deficit, exposed by consumer doubts, inconsistent experiences and scepticism from healthcare providers. Online social media forum Reddit features users dismissing or questioning nutraceutical products in thread after thread. Healthcare providers and functional medicine experts alike talk about proceeding with caution.

Health-fluencers such as hepatologist Cyriac Abby Philips, who runs the popular X handle The Liver Doc, have repeatedly attacked supplements. “Many of these products contain proprietary blends of herbs and compounds whose interactions, dosages, and long-term effects have not been thoroughly studied in humans,” Philips stated in a post on Instagram. “The liver, being the primary organ for detoxifying substances in the body, is especially vulnerable to injury from unregulated supplements, and there are numerous documented cases of supplement-induced liver injury (DILI), ranging from mild hepatitis to acute liver failure requiring transplantation or resulting in death.”

Yohan Tengra, a functional medicine expert, had a more nuanced view. “There is a lot of crap in this space. Supplements do work, but it is difficult for a layperson to identify the right ones when there are so many in the market. Many brands are playing on people’s desperation,” he told Mint.

Given this, what are top startups doing to bridge this trust gap?

Regulatory gaps

The core of the problem lies in regulatory classification and the common business model adopted by brands.

Nutraceuticals are governed by the Food Safety and Standards Authority of India (FSSAI), which has classified them as food or food-like products. This is a critical distinction, as products meant to treat a specific disease must be regulated as drugs under the much stricter Central Drugs Standard Control Organisation (CDSCO). As Biplab Lenin, partner at legal firm Cyril Amarchand Mangaldas, explained, the line is thin—a supplement can claim to “help improve sleep quality,” but not “treat sleep disorders.”

FSSAI operates with a preapproved list of ingredients and dosages. Unlike drugs, a clinical study is not required for a nutraceutical if the ingredients and dosage are from this list. “FSSAI may not specifically test the final product for efficacy or verify its claimed functional benefits,” said Lenin.

Mint has reached out to FSSAI but is yet to get a response.

‘A supplement can claim to help improve sleep quality, but not treat sleep disorders.’

This regulatory ease enables the industry’s widespread adoption of outsourcing and white labelling. Check almost any nutraceutical label, and you will find different companies listed as the marketer and the manufacturer. Startups rely on contract manufacturers, avoiding the capital investment needed for a factory.

However, in many cases, startups outsource the entire product development process to the likes of Brukem Life Sciences or Padmavati Nutraceuticals. Both operate out of Ahmedabad, a nutraceutical manufacturing hub.

Basant Agrawal, director at contract manufacturer Brukem Life Sciences, who has worked with over 20 startups, told Mint that clients typically come to him with a super ingredient in mind. His formulations and development team then creates a product around it. Or the startup simply white labels an existing product developed by Brukem, which is targeting ₹15 crore in revenue this fiscal year.

Jeegar Shah, a formulations expert and owner of Padmavati, specializes in creating formulations, sourcing ingredients and coordinating manufacturing. “Startups come to me and ask what new product will sell in the market. They ask for formulations that have worked globally,” he said.

While both Agrawal and Shah are bound by non-disclosure agreements, they confirmed that none of the companies they have worked with have requested clinical trials, as it is not a statutory requirement.

This structural arrangement—prioritizing speed and cost over proven efficacy—has led to a major challenge, acknowledged by industry veterans. Amit Mehta, founder and chief executive officer (CEO) of vegan nutraceutical brand Unived, critiques the new entrants. “A lot of them have come in with a business opportunity mindset and with zero understanding of what nutraceuticals are or what it takes to formulate a product,” said Mehta, who launched Unived in 2010 and does everything from research and development (R&D) to manufacturing in-house. “They just reach out to third-party manufacturers, who can ship 100 products overnight. You are not a health and wellness company then, just a marketing company.”

A file photo of Amit Mehta, founder and CEO, Unived.

Being clinical

To stand apart and foster customer confidence, many startups are now prioritising measures to establish credibility.

Take Kapiva, launched by Ameve Sharma in 2016. “We are in the process of finalizing a partnership with KMC Hospital, Manipal, to conduct a double-blind, randomized, placebo-controlled trial for our diabetes product. We want to do clinical trials that can be published in global journals and show how effective Ayurveda can be,” said Sharma, who hails from the family that runs the 108-year-old Baidyanath Ayurved brand.

Unlike regular Ayurveda, at Kapiva, the in-house R&D team isolates the active molecules in traditional Ayurvedic ingredients, standardizes them and then uses them to create supplements. Sharma says his goal is to make Kapiva the herbal Pfizer.

“If you want to build a ₹30 crore or ₹50 crore business in the short term, you can do that with just pure marketing,” said Sharma, who is targeting revenue of ₹600 crore this fiscal year. “But if your product doesn’t deliver results consistently in a measurable way, you’re not going to last long-term.”

However, Sharma notes that trials can be prohibitively expensive for early startups, with a regular third-party trial costing upwards of ₹1 crore, a rigorous phase-IV trial around ₹10 crore and an advanced trial like Kapiva’s as much as ₹25 crore.

Unived, which had not done any clinical trials so far, is set to run them for two products. The Good Bug does both ingredient-based and formulation-based clinical trials. Wellbeing Nutrition tests every batch of products at accredited labs and shares the results with any customer who asks for details.

Independent platforms have also cropped up to test products. Unbox Health, launched in 2023, tests food and supplement products at third-party labs and rates them on its website. Unbox bears the cost for community-requested products but charges brands that approach it directly, giving them the choice to publish or withhold results in the latter case. “There are instances where brands who saw lower ratings went back, fixed issues and improved their ratings on retesting,” said Arjun Anjaria, founder of Unbox. He added that the platform is in talks with online marketplaces to integrate its ratings so consumers can make informed decisions.

Customer-centric approach

Sometimes the bigger challenge is that customers may not look at the trial reports or follow the necessary steps for a supplement to work.

“Expectation setting in this industry is very important because we are not selling medicine that will solve the issue in a day,” said Keshav Biyani, who co-founded The Good Bug in 2022 to create products around gut bacteria and gut health.

A nephew of Future Group founder Kishore Biyani, he learnt the basics of building a consumer business during his seven-year stint at the retail group.

Keshav Biyani, co-founder, The Good Bug.

“With Metabolically Lean, you have to be consistent. If you are going to continue having sugar, fried food, and then expect this to work like magic, it is not going to happen.”

Biyani notes that the general ingredient-first market lacks differentiation, making it hard for customers to compare brands. For instance, search on Amazon for magnesium supplements and you will get over 600 results.The Good Bug and Ace Blend have moved to a riskier, problem-focused approach. Blended products such as Metabolically Lean or Ace Blend’s IBS Gastro Pro are aimed at improving a specific quality-of-life issue.

Shivam Hingorani, founder and CEO of Ace Blend, said offering a clean product is now the minimum requirement. “If you are investing your time, changing your habits and including a supplement in your life, it better yield results. We are in the efficacy game,” said Hingorani, who is targeting ₹100 crore in revenue by the end of this fiscal year.

To tackle gut inflammation caused by fungal growth, the company developed a blend of multiple Ayurvedic oils. However, regular supplements disintegrate in the stomach’s acidic environment much before they reach the gut, the target organ. The R&D team developed a coating to ensure the capsules open only in the alkaline environment of the gut. Hingorani claims the product is today a best-seller.

Getting doctors on board

While end-consumers may be swayed by marketing, the medical community remains a strong influencer group that needs convincing.

Wellbeing Nutrition targets doctors and hospitals. “About 20% of our sales comes from doctors prescribing our products,” said Avnish Chhabria, founder of Wellbeing Nutrition.

Founded in 2016, Wellbeing offers both ingredient supplements such as collagen, and problem-focused supplements aimed at issues such as poor metabolism, diabetes and polycystic ovarian syndrome. Chhabria, who is targeting ₹300 crore in revenue this fiscal year, claims Wellbeing’s products have been prescribed for patients suffering from sarcopenia, a musculoskeletal disease, and those undergoing chemotherapy.

Others are going a step further. Traya Health offers a supplement kit for hair loss that combines dermatology, nutrition and Ayurveda. Founded in 2019, Traya’s initial challenge was that customers did not have the patience to wait the five months required to start seeing results. “We saw people come and buy the first box and never come again. It was an existential crisis,” said co-founder Saloni Anand.

Traya responded by adding a dedicated coach and connecting customers to dermatologists after an online test. With over 1.5 million people having used Traya, Anand says the company has crossed the ₹500 crore revenue mark. Yet, a gap remained.

“Customers still asked, ‘You are an online brand, why should I trust you,’” said Anand. In response, Traya set up 12 physical centres, in locations such as Pune, Nagpur, Navi Mumbai and Hyderabad, where the customer could walk in, get tested, and meet with doctors and experts in person.

The Good Bug is also working on launching gut clinics next quarter. To be embraced by the larger healthcare community, Kapiva’s Sharma wants higher standards and more stringent regulatory requirements. “We (the industry) are offering an ingestible product, then why should we have any less a burden of proof or safety compared to an allopathic product?” asked Sharma.

Founders point out that the industry is still young, and trust takes years to build. While the onus is on consumers to make informed choices, brands know negative customer reviews on social media can sink them.

Akash Zaveri, co-founder and COO of plant-based nutraceutical brand Plix, claims his brand has a young user base that’s vocal online. “You can see their reviews and feedback on not just our website, but also on marketplaces and social media platforms,” he told Mint. “Strong nutraceutical businesses are all built on products. It’s very difficult to build a business if you are constantly searching for hero products that give you short-term success.”

The Good Bug’s Biyani takes this a step further. “As more people use your products and benefit from them, word of mouth keeps spreading and more equity and trust keeps building,” he said.

That is certainly true in Javeed’s case. “I tried the product only because I saw my wife benefit,” he said. Now, some of his friends have begun using Gut Cleanse and Metabolically Lean. Even his mother-in-law.