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  • Writer's pictureMohamed Soltan

What Investors Need to Know about Vegan Pharmaceuticals

The demand for ethical and sustainable products continues to rise. It influences production across most industries, and the pharmaceutical sector is no exception. Plant-based medicines, or vegan pharmaceuticals, are emerging as a promising niche. They offer investors the potential to align financial objectives with ethical considerations.

However, as with any investment, investors must consider the investment landscape before following a trend. Read on for an overview of the vegan pharmaceutical industry, the market potential, and associated risks.

Veganism and Its Influence on Pharmaceuticals

Veganism is a lifestyle driven by concerns over animal welfare, environmental sustainability, and health. Vegan pharmaceuticals are medical products entirely devoid of animal-derived ingredients and are not subject to animal testing. Instead, they are formulated using plant-based compounds or synthetic alternatives.

The influence of veganism on pharmaceuticals is evident in several areas, including but not limited to:

  • A renewed interest in the medical properties of plants. All over the world, plants have been used in traditional medicines for centuries. Now, with the rise of veganism, researchers are showing renewed interest in exploring the therapeutic potential of various plant species. Traditional therapies are being reassessed in this light.

  • Advancements in drug delivery systems. Most often, medications are delivered via gelatin capsules derived from animal sources. Now, vegan alternatives, such as cellulose-based capsules, are being developed. In addition to catering to vegans, they also offer improved stability and bioavailability of the medication. The global vegetarian capsule market is expected to reach $722.70 million by 2028.

  • Innovative new testing methods. Animal testing has been a contentious topic in the pharmaceutical industry for many years. The rise of veganism has prompted pharmaceutical companies to explore alternative testing methods that do not involve animal subjects. This has led to the development of innovative in vitro models and computer simulations that can assess the safety and efficacy of drugs without abusing animals.

  • More sustainable processes and packaging. The influence of veganism on pharmaceuticals extends beyond the products themselves. Pharmaceutical companies are increasingly adopting sustainable and eco-friendly practices in their manufacturing processes. These practices include reducing water and energy consumption, implementing recycling initiatives, and minimizing waste generation.

As veganism continues to grow, its influence will likely drive further innovation and change in the industry.

Market Potential and Growth Prospects

A report by Technavio estimates the global market for plant-derived pharmaceuticals will grow by $22.61 billion at a CAGR of 9.23 percent between 2022 and 2027. In addition to the increasing demand for vegan-friendly medicines by consumers, growth is expected to be driven by several other factors:

  • Government funding and incentives. The World Health Organization (WHO) and governments around the world are providing funding for research and development in herbal medicine. Countries like China, India, Nigeria, and the United States are showing evident investment in this field. Governments are increasingly incentivizing the production of plant-based drugs by awarding contracts to pharmaceutical companies. For instance, the Canadian government has contracted PlantForm to develop a plant-derived antibody to counter ricin exposure.

  • Increasing prevalence of the disease. An increase in the prevalence of neurological disorders (such as autism), certain cancers (ovarian and pancreatic), and schizophrenia are increasing demand for new, viable medications. The botanical and plant-based drug industry has expanded to encompass a wide range of therapy segments, including infectious diseases, central nervous system disorders, cardiovascular conditions, and respiratory diseases.

  • Lower costs. Plant-derived drugs are often cheaper to produce and require less capital investment than conventional laboratory-produced medicine. They can also require less technical expertise. A notable example of progress in this area is the development of a plant-derived alternative to Cerezyme, an artificial enzyme used to break down lipids in individuals with Gaucher disease. By eliminating the need for expensive protein remodeling in the production process, it has successfully reduced costs by 25 percent.

  • Lower risks. Drugs produced using animal products can introduce the risk of mammalian viruses. Plant-derived medications avoid this risk. Additionally, when transported in seed form, the raw materials for production aren't dependent on maintaining a cold chain. This is particularly beneficial in regions where such facilities are lacking and laboratory-produced ingredients are at risk of contamination.

  • Supportive regulation. The regulatory landscape in the US is transforming and enabling the plant-based drug industry. In 2004, the FDA facilitated the approval of botanical drugs and received 400 IND applications. One example of an approved botanical drug is Fulyzaq, which treats diarrhea in patients with HIV/AIDS undergoing anti-retroviral therapy. Before its approval, this side effect often led to patients discontinuing their therapy, making Fulyzaq the much-needed alternative for effective treatment.

Due Diligence

Like any investment, vegan pharmaceuticals carry their own set of risks. Investors must conduct thorough due diligence before committing funds. This includes investigating the company's track record, experience in vegan drug development, and commitment to ethical practices. They must also assess the potential market size and demand for the specific vegan pharmaceutical product.

It’s also important to understand the regulatory landscape for vegan pharmaceuticals in the target market, including any potential barriers to market entry, and evaluate the company's intellectual property portfolio and potential risks of infringement or competition.


The rise of veganism presents an excellent opportunity for investors to capitalize on a market segment that is both socially responsible and economically promising. They can position themselves strategically to benefit from a burgeoning market by keeping a keen eye on market trends.

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