Speaking at the Vitafoods show in Geneva, Robin Wyers from research firm Innova Insights, conceded the health claims regime — which saw only 222 claims being approved with over 2,000 rejected — had, along with the global economic downturn, done little to help the sector.
Since EFSA started its work and the financial outlook became bleak, the share of product launches with functional health claims had dropped from 9% to 7%.
However, claims were not "the be all and end all", said Wyers.
High levels of awareness
"UK studies show there are quite high levels of awareness of health ingredients, especially omega-3 fatty acids," he added.
Even probiotics and antioxidants, which have been hit hardest by EFSA rejections, were still performing well in terms of consumer awareness, he added.
He highlighted vitamins and iron as prime opportunities for growth.
"Manufacturers are rushing to make claims around vitamins but the opportunity around them is still huge," he said. "Around 75% of people in the UK, US and Germany do not get the recommended intake for vital nutrients."
He said many firms had switched their probiotic marketing strategies in the wake of EFSA health claim rejections to ones centred on the immunity benefits of vitamin C.
Iron was another massive market opportunity, he added, citing World Health Organisation figures of rising cases of anaemia — not least among pre-school children.
"We have seen some baby products fortified with iron, but relatively few in the wider scheme of things," said Wyers. "There is significant potential here."
New technology is also opening up new markets, not least around adding omega-3 fatty acids to a wider range of products. In the US they have been added to beef and beefburgers and beverages, "reinforcing to consumers that they don't have to taste of fish".
Wyers said the "health traffic jam" needed to be tackled.
"It is time to stop complaining about EFSA — it is by no means perfect — but there are still opportunities out there."