Japanese capsule shell quality control and technology
Introduction: the often-overlooked critical component called 'capsule'
Capsule shells are not merely containers. Numerous technical elements affect the final quality of products, including dissolution rate in gastric acid, resistance to humidity, interaction with fillers, and stability during manufacturing processes. Without selecting appropriate capsules, no matter how excellent the active ingredients may be, problems arise: substances fail to release at the intended timing within consumers' bodies, quality deteriorates during storage, and troubles occur frequently during manufacturing.
The Japanese capsule manufacturing industry occupies a distinctive position in the global market. Whilst production volume does not match that of major European, American, or Asian firms, it possesses outstanding characteristics in technical precision and stringency of quality control. Quality standards cultivated in pharmaceutical manufacturing are applied to health food applications as well, and in clarifying functional design and presenting empirical data, Japanese manufacturers take an approach that differs from manufacturers in other countries.
In 2024, the global capsule shell market reached approximately 3.5 billion dollars in scale, and is predicted to continue growing at an annual rate of 5 to 8 per cent. The Japanese market stands at approximately 193 million dollars, with anticipated growth of 6.6 per cent annually. When entrepreneurs consider the business of supplements or pharmaceuticals, many concentrate on selecting active ingredients and formulation design, but in reality, the quality of the 'capsule' that encases those ingredients significantly determines the reliability of the entire product and the success or failure of the business.
This article objectively explains the technical characteristics of Japanese-made capsule shells through comparison with global competitors.
Chapter1: Japan's capsule manufacturing structure – quality standards in an oligopolistic market
1.1 Structure of the Japanese market
The capsule shell market within Japan has become an oligopolistic structure dominated by three companies. Qualicaps, headquartered in Nara Prefecture, bears the core of domestic manufacturing, producing hard gelatine and HPMC (plant-based) capsules. As a capsule-specialist manufacturer with manufacturing and sales bases in Japan, Europe, North America, and South America, the company occupies a corner amongst the principal suppliers within Japan.
Lonza (formerly Capsugel) supplies the Japanese market from its global manufacturing network, including Sagamihara. After acquiring Capsugel in 2017, the company announced expansion exceeding 30 billion capsules annually at eight locations worldwide, maintaining a supply structure of the largest class. The Japanese base is included amongst global expansion targets, having constructed a structure with manufacturing capabilities particularly for lipid-related capsules and others.
South Korea's Suheung has established a Japanese sales base (Soheung Japan Co., Ltd.) in Yokohama, supplying empty capsules manufactured in South Korea, Vietnam, and elsewhere. This three-company structure forms the substantive supply structure in the Japanese market.
The reality of this oligopolistic structure became apparent in the supply suspension and recall problems that occurred in 2022. Temporary supply constraints occurred at major supply sources including Qualicaps, exerting significant impact upon the entire industry. Subsequently, supply resumed through measures such as HPMC prioritisation, but this situation became an event demonstrating the degree of market share concentration within the domestic market.
The scale of the Japanese market is estimated at approximately 193 million US dollars as of 2024, anticipated to grow to approximately 343 million US dollars by 2033. The principal growth factors are expansion of pharmaceutical demand and supplement demand accompanying population ageing. In market segments, gelatine capsules occupy the largest share, but non-gelatine (HPMC, etc.) also shows an expansion trend due to rising vegan orientation and clean label requirements.
1.2 The standard of Japanese Pharmacopoeia compliance
The greatest characteristic in Japanese capsule manufacturing is that the stringent quality standard of Japanese Pharmacopoeia (JP) compliance has become the industry standard. The Japanese Pharmacopoeia establishes quality specifications for pharmaceuticals, but this standard is broadly applied to capsules for health food applications as well. In many countries, manufacturing regulations for health food capsules are relatively lenient, but in Japan, pharmaceutical-level quality control is adopted voluntarily.
Manufacturing structures under GMP (Good Manufacturing Practice) management have also become standard in Japan. GMP refers to manufacturing process control standards necessary for products to be made safely and for consistent quality to be maintained throughout all processes, from receipt of raw materials through manufacturing to shipment of final products. In Japan, the health food GMP certification system commenced in 2005, and stringent management methods that had been employed in pharmaceutical manufacturing have been applied to the field of health foods.
The thoroughness of this quality control structure manifests in cleanliness management of manufacturing facilities. Workers wear dedicated cleanroom attire and pass through air showers before entering manufacturing areas. Air within manufacturing rooms is constantly filtered, and temperature and humidity are also strictly controlled. On manufacturing lines, metal detectors and X-ray inspection machines are used, missing not even the slightest foreign matter. When manufacturing multiple products, cleaning and verification at line changeovers are thoroughly conducted to ensure that components from previous products do not remain.
Product homogeneity is also rigorously checked. If products belong to the same lot, the quality must be identical regardless of which container is opened. Samples are collected periodically during manufacturing, and component content, dissolution properties, and other factors are analysed. Statistical methods are employed to verify that product variation remains within acceptable ranges.
Records of all manufacturing processes and quality control are created in detail according to regulations and stored for extended periods. Everything is traceable: when, by whom, which raw materials were used, and under what conditions manufacturing occurred. Even should problems arise, by tracing these records, causes can be identified and only the relevant lots can be swiftly specified.
1.3 Japan's positioning in the global market
In the global capsule shell market, Japanese companies adopt a strategy of differentiation through quality precision rather than production volume. The principal players in the global market include Switzerland's Lonza, India's ACG, and South Korea's Suheung. These enterprises possess enormous production capacity and extensive sales networks, demonstrating price competitiveness that exploits economies of scale.
Lonza possesses the capability to produce approximately 260 billion capsules annually at eight locations worldwide, deploying an extensive portfolio including Vcaps, DRcaps, Enprotect, and others. ACG maintains high cost competitiveness in both gelatine and HPMC, with strengths in custom certifications such as halal and kosher compliance. Movements to further strengthen price advantages through new bases in Thailand and elsewhere are also observed.
In contrast, Japanese companies provide distinctive value in precision of functional design, richness of empirical data, and completeness of regulatory compliance documentation. Whilst production volume does not match competitors, Japanese firms have established an approach that differs from manufacturers in other countries in comprehensive support structures from product development through approval acquisition.
Examining the segment composition of the global market, gelatine capsules occupy the largest share. The breadth of pharmaceutical and supplement applications and cost advantages support gelatine's market share. However, in recent years, HPMC (hydroxypropyl methylcellulose) capsules have been growing rapidly. This is because characteristics absent in gelatine are being valued, such as vegan compliance, religious consideration (halal and kosher), and resistance to humidity. Japanese companies are concentrating particularly on developing highly functional products in this HPMC field.
Chapter 2: Technical advantages of Japanese-made capsules – functional design and empirical data
2.1 Acid dissolution delay technology: the case of QUALI-V-S
One of the cases that best demonstrates the technical advantages of Japanese-made capsules is QUALI-V-S, developed by Qualicaps. This is an HPMC capsule with design that delays dissolution in gastric acid, suitable for applications requiring intestinal delivery.
Many nutritional components and pharmaceutical active ingredients possess the characteristic of being vulnerable to gastric acid. For instance, probiotics (lactic acid bacteria) are largely killed by gastric acid. Omega-3 fatty acids cause fishy 'reflux' when dissolved in the stomach. Certain enzymes are inactivated by gastric acid. To deliver these components to the intestines, it is necessary to delay dissolution in the gastric acid environment.
The distinguishing feature of QUALI-V-S is that it clearly presents this acid dissolution delay characteristic together with dissolution test conditions. Specifically, dissolution behaviour under acidic conditions of pH 1.2 (simulating gastric acid) and dissolution behaviour under neutral conditions of pH 6.8 (simulating intestinal environment) are disclosed as data. The characteristics whereby dissolution is suppressed under acidic conditions and occurs rapidly under neutral conditions are substantiated numerically.
This transparency possesses significant value at the product development stage. When developing new supplements or pharmaceuticals, formulation designers must verify 'whether this capsule truly resists dissolution in gastric acid'. If capsule manufacturers do not provide clear data, companies must conduct dissolution tests themselves and comparatively evaluate multiple candidate capsules. This work requires time and cost.
In the case of QUALI-V-S, because dissolution test conditions and data are presented in advance, the number of trials at the initial screening stage can be reduced. Furthermore, application examples to acid-vulnerable materials and gastric-irritant materials are also shown concretely, making it easier to judge whether one's own products fall within those applications. This combination of 'clarification of design intent' and 'presentation of empirical data' constitutes a major characteristic of Japanese-made capsules.
Capsules with enteric or delayed-release functions also exist amongst global competing products. Lonza's DRcaps, Enprotect, and others lead the world in targeted release technology. However, the distinguishing feature of Japanese products lies in transparency of data disclosure and the explicit indication of specification compliance with Japanese Pharmacopoeia. Particularly for projects requiring compliance with the Japanese market or Japanese regulatory standards, this conformity directly leads to shortening of development periods.
2.2 Moisture content control and interaction avoidance: the case of QUALI-V-N
Another important technical characteristic is moisture content control and interaction avoidance. Qualicaps's QUALI-V-N is an HPMC immediate-release capsule that addresses this challenge.
Many active ingredients are sensitive to moisture and interactions with other materials. Particularly problematic are reactions with gelatine capsules. Gelatine is an animal-derived protein and may undergo chemical reactions with specific components. For instance, components possessing aldehyde groups undergo cross-linking reactions with gelatine, and capsules may harden and cease to dissolve. Reducing substances such as vitamin C may also cause interactions with gelatine.
Moreover, many components sensitive to humidity exist. Probiotics experience reduced activity through moisture. Certain herbal extracts solidify through moisture absorption. Enzymes may become inactivated through moisture. When filling these components, characteristics whereby the capsule itself has low moisture content and resists releasing moisture are required.
QUALI-V-N avoids the risk of interaction with gelatine by being HPMC-based, and further enhances compatibility with moisture-sensitive components by controlling moisture content. This characteristic is disclosed together with dissolution behaviour data, demonstrating that immediate release (normal dissolution in the stomach) is achieved stably.
This technical characteristic demonstrates value in risk reduction at the formulation design stage. When developing new products, predicting interactions between components and capsules is difficult. Problems may only become apparent after creating prototypes and conducting stability tests. Should problems be discovered, capsules must be changed and prototyping and testing conducted again. When this cycle repeats, time and cost until commercialisation increase substantially.
By selecting capsules such as QUALI-V-N, where consideration for moisture and interactions is incorporated into the design and those characteristics are demonstrated through data, the risk of such retesting and redesign can be reduced. Particularly in complex formulations that blend multiple active ingredients, this predictability contributes significantly to shortening development periods.
2.3 Richness of provided documentation
Another major characteristic of Japanese-made capsules is the richness of provided documentation. Taking Qualicaps as an example, comprehensive documents are provided, including SDS (Safety Data Sheets), specifications, test methods, manufacturing flows, and statements regarding radioactivity.
SDS (Safety Data Sheet) is a document that compiles information necessary for safe handling of chemical substances. It contains component information, physicochemical properties, hazards, handling precautions, first aid measures, and other details. Submission is mandated in many countries, making it an essential document when bringing products to market.
Specifications are documents that establish quality standards for products. Standards that products must satisfy are clearly stated, such as appearance, size, dissolution properties, moisture content, and microbial limits. Test methods detail testing procedures for confirming these specifications. Testing conditions, equipment used, judgement criteria, and other specifics are concretely described to enable reproducible testing.
Manufacturing flow is a document showing the processes through which capsules are manufactured. Each process is illustrated, including raw material receipt, mixing, moulding, drying, sorting, and packaging. This information demonstrates transparency in manufacturing management whilst also serving as foundational material when customer companies conduct supplier audits.
Statements regarding radioactivity are documents whose importance has increased in international transactions, particularly following the Great East Japan Earthquake of 2011. To prove that products are not contaminated with radioactivity, manufacturing location, raw material origins, inspection results, and other information are recorded. Cases exist where overseas buyers make submission of this document a mandatory condition.
Through comprehensive provision of these documents, approval applications for products and audit responses are made more efficient. When obtaining approval for health foods or pharmaceuticals, regulatory authorities demand quality assurance of raw materials. If documentation provided by capsule manufacturers is rich, preparation of approval application materials becomes easier.
Moreover, these documents are important when customer companies conduct their own supplier audits. Companies under GMP management in particular are required to audit the quality control structures of raw material suppliers periodically. Through documentation of manufacturing flows and quality control procedures, audit efficiency increases and identification of problems also becomes easier.
The reason Japanese companies devote such effort to document provision lies in the tradition of pharmaceutical manufacturing. In the pharmaceutical industry, documentation and recording of all manufacturing processes and quality control have been taken for granted. This culture has been carried over to manufacturing of health food capsules, and as a result, a structure supporting regulatory compliance of customer companies has been established.
Chapter 3: The reality of cost structure – unit price versus total cost of ownership
3.1 The reality of unit price comparison
When considering Japanese-made capsules, an unavoidable issue is price. Frankly speaking, compared with products from global major enterprises, the unit price of Japanese-made capsules tends towards the higher side. This price differential is structural, arising from differences in production scale.
Lonza produces approximately 260 billion capsules annually at eight locations worldwide. ACG also possesses large-scale production structures centred on India. These enterprises exploit economies of scale through mass production, and can suppress unit prices through bulk procurement of raw materials, automation of manufacturing processes, and streamlining of logistics. Particularly for standard gelatine capsules, this volume advantage is directly reflected in prices.
The production scale of Japanese companies becomes smaller when compared with these global majors. Qualicaps is a global enterprise with bases in Japan, Europe, North America, and South America, but does not possess production volume equivalent to Lonza or ACG. Consequently, even for products of equivalent specifications, differences in volume advantages manifest in unit prices.
Furthermore, capsules possessing functionality become more expensive than standard gelatine capsules. To realise additional functions such as acid resistance, delayed release, and special coatings, upgrading of raw materials and addition of manufacturing processes are necessary. This is not limited to Japanese products; price premiums similarly exist for functional capsules from global majors, such as Lonza's DRcaps and Enprotect.
Therefore, it cannot be denied that Japanese-made capsules appear disadvantageous in simple unit price comparisons. For applications premised on bulk procurement where standard specifications suffice, procurement from global majors will often be more advantageous in terms of cost.
3.2 The perspective of total cost of ownership
However, when evaluating the cost of capsule procurement, looking at unit price alone is insufficient. It is important to consider the perspective of Total Cost of Ownership. Total cost of ownership is a concept that includes not only the purchase price of products but all costs occurring throughout the entire product lifecycle, including development, quality control, regulatory compliance, and troubleshooting.
Consider the product development stage. When developing new supplements, formulation designers evaluate multiple capsule candidates. If capsule manufacturers do not provide sufficient data, companies must conduct dissolution tests, stability tests, interaction tests, and others themselves. These tests require testing facilities, reagents, and personnel costs. Should multiple rounds of prototyping and testing be repeated, costs expand further.
With Japanese-made capsules, where dissolution data, stability data, and application examples are provided in advance, the number of trials at the initial screening stage can be reduced. For instance, the possibility exists to narrow ten capsule candidates down to three. This reduction effect directly leads to shortening of development periods and cost reduction.
At the manufacturing stage, the risk of quality troubles is important. If capsule quality is unstable, various problems occur, such as breakage during filling operations, discolouration during storage, and deformation through humidity. Should these problems arise, substantial costs occur, including cause investigation, lot disposal, and manufacturing line stoppages. Costs for responding to customer complaints cannot be ignored either.
By selecting capsules with stable quality, these troubleshooting costs can be reduced. The stringent quality control of Japanese-made capsules contributes to risk reduction at the manufacturing stage. Particularly, small variation between lots directly leads to stability of manufacturing processes.
Regulatory compliance costs also cannot be overlooked. When bringing health foods or pharmaceuticals to market, submission of quality assurance documents is required in many countries. If capsule manufacturers do not provide sufficient documentation, companies must conduct additional tests themselves and create data. Should enquiries arise from regulatory authorities, enquiries must be made to capsule manufacturers each time and responses obtained.
The rich document provision of Japanese-made capsules reduces these regulatory compliance costs. Time for preparing approval application materials is shortened, and interactions with regulatory authorities also become smoother. As a result, the period until market launch is shortened, and opportunity losses can be reduced.
Shortening of time-to-market (time until market launch) possesses significant value for business. Particularly in the fiercely competitive health food market, delays of several months may exert substantial impact upon market share. If the development period is shortened by six months, sales can begin correspondingly earlier. When this opportunity profit is considered, the unit price differential of capsules becomes relatively small.
3.3 Practical selection criteria
Then, how should capsules be selected practically? To balance unit price and total cost of ownership, several judgement criteria are effective.
First, confirm primary conformity to functional requirements. Clarify the design intent of the product: whether acid resistance is essential, whether resistance to humidity is important, whether immediate release suffices. Then evaluate whether product data directly addressing those requirements is provided. Capsules such as QUALI-V-S, where dissolution test conditions and applicable material information are disclosed, facilitate judgement of initial conformity.
Next, confirm certification and regulatory compliance requirements. For the Japanese market, Japanese Pharmacopoeia compliance is important. For the American market, FDA compliance is necessary; for the European market, specifications and documentation for EMA compliance are required. If deployment to multiple markets is being considered, products compliant with international standards are advantageous. Document availability and frequency of updates are also important elements when considering long-term transactions.
Supply stability is also a point requiring consideration. Global majors secure supply redundancy through production at multiple bases. Conversely, companies possessing domestic bases sometimes have advantages in short delivery time response and flexibility during emergencies. Judge which supply structure is suitable according to one's own production plans and inventory strategy.
Product positioning is also an important judgement element. For products aiming at differentiation in the premium price range, the quality appeal of 'using Japanese-made capsules' becomes material justifying price premiums. Conversely, for products emphasising price competitiveness aimed at mass markets, procurement from global majors with cost priority may be suitable.
Practically, differentiated use according to application is most rational. By constructing a strategic procurement portfolio whereby Japanese-made products are used for products where functionality and quality are important, and global majors for products where standard specifications allow exploitation of volume advantages, the balance of cost and quality can be optimised.
Chapter 4: Capsule market characteristics by country and region, and the position of Japanese products
4.1 Characteristics of the North American market and capsule usage trends
The North American market is the world's largest capsule-consuming region, with high demand for both pharmaceuticals and health foods. Market scale is estimated at approximately 80 billion capsules annually or more, accounting for approximately 35 per cent of the global capsule market.
The characteristics of capsules favoured in the North American market are the harmonisation of functionality and regulatory compliance. Under the stringent regulatory environment of the FDA (Food and Drug Administration), pharmaceutical-grade highly functional capsules are prized. Particularly, the adoption rate of capsules possessing targeted release technology (enteric, delayed release) is high, and in pharmaceutical development they have become standard options.
In terms of materials, whilst traditional gelatine capsules remain mainstream, in recent years a shift towards HPMC plant-based capsules has been conspicuous. Particularly in the health food field, demand for vegan and vegetarian compliance is rising, and the HPMC market is growing at an annual rate exceeding 10 per cent. Rising environmental consciousness and health orientation amongst consumers are accelerating this trend.
Regarding supply structures, local production tends to be emphasised. Major pharmaceutical companies and health food manufacturers prioritise suppliers possessing manufacturing bases within North America for supply chain stability and risk diversification. Bulk procurement on the scale of hundreds of millions of capsules annually is common, and stable supply capability together with price competitiveness become important selection criteria.
The share of Japanese-made capsules in this market is limited, remaining at an estimated 2 to 3 per cent. The principal reasons are insufficient price competitiveness and local production structures. However, in specific niche fields, particularly premium health foods emphasising high quality and speciality pharmaceuticals requiring precise functional design, adoption cases exist albeit in small numbers. In scenarios where Japan's precise quality control and detailed technical data are valued, room exists to justify price premiums.
4.2 Characteristics of the European market and capsule usage trends
The European market possesses scale second to North America, with approximately 60 billion capsules or more consumed annually. Occupying approximately 25 to 30 per cent of the global market, demand particularly in the pharmaceutical field is steady.
The characteristics of the European market are stringency of quality standards and uniformity of regulations. Compliance with EU pharmaceutical regulations (EMA standards) and EU GMP (Good Manufacturing Practice) is essential, and completeness of quality documentation is required. Compliance with pharmacopoeias of various countries (European Pharmacopoeia, national pharmacopoeias) is also important, and suppliers with well-organised documentation management structures stand at an advantage.
In material selection, Europe is the region where plant-based capsules have achieved the most widespread adoption in the world. Due to the historical background of BSE (bovine spongiform encephalopathy) problems, a cautious attitude towards gelatine exists, and the adoption rate of HPMC plant-based capsules is rising. Particularly in major markets such as Germany, France, and the United Kingdom, it is estimated that more than 50 per cent of health foods use HPMC capsules.
Consideration for sustainability is also a characteristic of the European market. Because environmental regulations are strict and consumer environmental consciousness is also high, traceability of capsule material origins and initiatives towards sustainable procurement are valued. Suppliers that disclose carbon footprints and conduct ethical raw material procurement tend to be favoured.
In terms of supply, multi-site manufacturing within the European region is emphasised. From the perspectives of logistics efficiency within the EU and regulatory compliance, global suppliers possessing manufacturing bases in multiple EU member states are advantaged. However, due to a quality-oriented culture, not only price but also the quality of technical support and documentation responses become important selection criteria.
The share of Japanese-made capsules in Europe is even lower than in North America, at an estimated 1 to 2 per cent. High logistics costs due to physical distance, absence of local manufacturing bases, and delays in European Pharmacopoeia compliance constitute barriers to entry. However, Japan's quality control structures and precise data management are valued, and adoption opportunities exist for pharmaceuticals requiring special functionality and products emphasising ultra-high quality.
4.3 Characteristics of the Chinese and Southeast Asian markets and capsule usage trends
The Chinese and Southeast Asian region is the most rapidly growing capsule market in the world. In China alone, approximately 40 billion capsules or more are consumed annually, and across Southeast Asia as a whole approximately 20 billion capsules or more are consumed, with the market expanding at an annual rate of 8 to 12 per cent.
The greatest characteristic of this region is high price sensitivity. Health foods aimed at mass markets are mainstream, and price settings that consider consumer purchasing power are indispensable. Because capsule costs directly affect product prices, standard gelatine capsules are overwhelmingly frequently used. High-functionality capsules are limited to certain premium products and pharmaceuticals.
In the Chinese market, domestic capsule manufacturers possess a strong presence. Numerous local manufacturers authorised by the National Medical Products Administration (NMPA) exist, satisfying the majority of domestic demand. In addition to advantages in pricing, familiarity with local regulations and commercial practices, and comprehensive support structures in Chinese language constitute strengths of domestic manufacturers.
In Southeast Asian countries (Thailand, Vietnam, Indonesia, Malaysia, the Philippines, and others), the proportion of imported capsules becomes higher. Supply from manufacturers with manufacturing bases particularly in India and Thailand is mainstream. The importance of halal certification is high, and in regions with large Islamic populations (Indonesia, Malaysia), demand for capsules with halal certification obtained becomes substantial.
As a recent trend, improvement in quality consciousness is also observed in China and Southeast Asia. With expansion of the middle class accompanying economic growth, premium markets are beginning to form. Particularly in major Chinese cities, demand for high-quality, high-functionality health foods is rising, and adoption of HPMC plant-based capsules and functional capsules is increasing.
The share of Japanese-made capsules in this region is estimated at approximately 3 to 5 per cent. They are adopted mainly in the following fields:
Japanese brand health foods (Asian deployment products of Japanese companies)
High-quality health foods aimed at premium markets
Local brand products emphasising 'Japanese quality'
Speciality products requiring pharmaceutical grade
Particularly in China, the label 'made in Japan' is highly valued as proof of quality, and can justify price premiums. For products targeting affluent classes and quality-oriented consumer segments, use of Japanese-made capsules becomes a differentiation element. However, in mass markets, insufficient price competitiveness is a challenge, and penetration is limited.
4.4 Characteristics of the Middle Eastern, Indian, and South Asian markets and capsule usage trends
The Middle Eastern, Indian, and South Asian region is a market possessing distinctive cultural and religious requirements. In India alone, approximately 30 billion capsules or more are consumed annually, and across the Middle East as a whole approximately 15 billion capsules or more are consumed.
The greatest characteristic of this region is the necessity of religious consideration. In Islamic regions, halal certification becomes a de facto essential requirement. Porcine-derived gelatine cannot be used, and even for bovine-derived gelatine, proof that it originates from animals slaughtered according to halal practices is necessary. Consequently, demand for HPMC plant-based capsules is high, and in Islamic region markets the adoption rate substantially exceeds the global average.
In the Indian market, to accommodate religious diversity (Hinduism, Islam, Jainism, and others), plant-based capsules are favoured. Particularly because the vegetarian population is large, HPMC capsules that can clearly demonstrate they contain no animal-derived components are broadly accepted. India is also one of the world's leading capsule-producing countries, and local manufacturers satisfy the majority of domestic demand.
Price sensitivity is also an important characteristic of this region. Due to purchasing power constraints, cost-efficient capsules are required. Indian-made capsules achieve low prices whilst satisfying international quality standards, and exports are expanding not only within the region but to global markets as well.
In the affluent nations of the Middle East (UAE, Saudi Arabia, Kuwait, and others), quality-oriented tendencies are also observed, premised on halal certification. Consumption of imported health foods and pharmaceuticals is substantial, and European and American brands possess a strong presence. Capsules used in these products are required to satisfy international quality standards together with halal certification.
The share of Japanese-made capsules is extremely limited in this region, at an estimated less than 1 per cent. The principal reasons are as follows:
Delays in halal certification acquisition (some Japanese manufacturers respond, but awareness is low)
Insufficient price competitiveness (the price differential with Indian-made products is large)
Lack of local sales networks
Insufficient understanding of cultural and religious markets
However, when Japanese companies deploy to this region, cases exist where Japanese-made capsules are used. Moreover, for niche products emphasising ultra-high quality, adoption opportunities exist. In future, if Japanese manufacturers strengthen halal certification acquisition and deepen cooperation with local partners, possibilities for market share expansion exist.
4.5 Characteristics of the Japanese market and capsule usage trends
The Japanese market occupies a distinctive position within the global market. Market scale is estimated at approximately 10 billion capsules annually, accounting for approximately 4 to 5 per cent of the global market. Whilst not large in scale, it is one of the world's most challenging markets in height of quality requirement standards and stringency of regulations.
The greatest characteristic of the Japanese market is extremely high demands for quality. For pharmaceuticals, complete compliance with the Japanese Pharmacopoeia is essential, and for health foods as well, quality control at levels equivalent to pharmaceuticals is expected. Consumer quality consciousness is also at the world's highest standard, and even slight quality problems carry the risk of substantially damaging brand trust.
Stringency of regulatory compliance is also a characteristic of the Japanese market. In the PMDA (Pharmaceuticals and Medical Devices Agency) approval process for pharmaceuticals, consumer affairs agency notification for foods with function claims, and other procedures, submission of detailed technical materials and test data is required. In these procedures, comprehensive document provision from capsule suppliers (SDS, specifications, test methods, manufacturing flows, stability data, and others) becomes indispensable.
In terms of materials, the Japanese market is conservative, and gelatine capsules remain mainstream. In the pharmaceutical field, it is estimated that approximately 80 per cent or more use gelatine capsules. In the health food field as well, because gelatine has a long usage history and abundant safety data, cautious selection is favoured. However, in recent years, with rising health consciousness, adoption of HPMC plant-based capsules is also showing an increasing trend.
Behind the ability of domestically produced capsules to maintain high market share in the Japanese market lie several structural factors. First, in the pharmaceutical field, through long-standing transaction relationships and quality track records, stable transactions with major pharmaceutical companies have been established. In the health food field as well, many major domestic manufacturers prefer domestically produced capsules from the perspectives of quality control structures and regulatory compliance.
Examining the breakdown of imported capsules (50 to 60 per cent), supply is centred mainly on major global manufacturers from Europe and America. When special functional capsules (advanced delayed-release technology, etc.) are necessary, or in cases where the same capsules used in the home country are employed in Japanese deployment of global products, imported capsules are selected. In terms of price as well, when premised on bulk procurement, imported capsules may become more advantageous in some instances.
4.6 Characteristics of the South American and other emerging markets
The South American market (Brazil, Argentina, Chile, and others) has a scale of approximately 10 billion capsules annually. Price sensitivity is high, and standard gelatine capsules are mainstream. However, in large nations such as Brazil, with expansion of the middle class, premium markets are also growing, and demand for HPMC plant-based capsules is also showing an increasing trend.
In the African market, capsule consumption itself is still limited, but with economic growth and improvement in medical access, future growth is anticipated. Price sensitivity is extremely high, and low-cost capsules for fundamental pharmaceuticals and health foods are central.
The share of Japanese-made capsules in these emerging markets is in a situation close to virtually zero. The principal reasons are insufficient price competitiveness, logistics costs, and absence of local sales networks. However, when Japanese companies advance into these markets, cases exist where Japanese-made capsules are used as part of quality appeals for their own products.
4.7 Comprehensive assessment of Japanese-made capsules in the global market
The share of Japanese-made products in the global capsule market as a whole is estimated at approximately 5 to 7 per cent. Against market scale (approximately 2 trillion capsules or more annually), Japanese-made supply remains at approximately 100 to 140 billion capsules.
The strengths of Japanese-made capsules lie in non-price elements: quality, precision, data, and support. In scenarios where these elements are emphasised, price premiums can be justified:
Pharmaceuticals and foods with function claims in markets with strict regulations (Japan, Europe and America)
Quality-appeal products in premium markets
Speciality products requiring precise functional design
Products deployed as Japanese brands
Product categories where Japanese-made products demonstrate advantages
Enteric and delayed-release supplements are one of the categories where Japanese-made capsules demonstrate strengths most fully. When handling components vulnerable to gastric acid or components with gastric irritant properties, such as probiotics (lactic acid bacteria), omega-3 fatty acids, and enzyme supplements, acid dissolution delay characteristics determine product efficacy. By using capsules with demonstrated dissolution behaviour, such as QUALI-V-S, scientific substantiation can be provided for the appeal 'reaches the intestines'. Consumers more easily perceive product efficacy, leading to repeat purchases.
Products handling formulations with high humidity or interaction risks are also areas where Japanese-made capsule technology proves valuable. In composite supplements blending multiple active ingredients, products using herbal extracts sensitive to moisture, and products containing components that may react with gelatine, capsule selection significantly determines product stability. By selecting appropriate capsules at the initial stage, formulation changes and retesting in late development can be avoided, and delays in market launch can be prevented.
For products aimed at markets with stringent auditing and regulatory compliance, the rich documentation structure of Japanese-made capsules possesses value. When aiming for approval within Japan as foods with function claims, quasi-drugs, or pharmaceuticals, by using capsules compliant with the Japanese Pharmacopoeia, the approval process is simplified. In European and American markets as well, manufacturing track records under GMP management and comprehensive quality documentation facilitate negotiations with regulatory authorities.
Products aiming at differentiation in the premium price range are also scenarios for utilising Japanese-made capsules. For products targeting quality-oriented consumer segments, the appeal 'using Japanese-made capsules' becomes material justifying price premiums. Particularly in Asian markets such as China, Taiwan, Hong Kong, and Singapore, trust in Japanese products is high, and this quality appeal contributes to brand building. By displaying 'Made with Japanese capsules' on product packaging, commitment to quality can be visualised.
Conversely, challenges of Japanese-made capsules are also clear. In terms of price, cases where they become 20 to 40 per cent more expensive compared with global majors are common, and for mass market products premised on bulk procurement, competitiveness is lacking. In global supply structures as well, limitations of multi-site manufacturing exist, and for projects requiring simultaneous supply to multiple regions, this becomes a constraint. Insufficient sales networks and awareness in emerging markets, and delays in responding to religious certifications such as halal and kosher, also become barriers in global deployment.
Observing these market characteristics by region, the capsule market is decidedly not homogeneous. In North America and Europe, functionality and regulatory compliance are emphasised; in China and Southeast Asia, balance of price and quality; in the Middle East, India, and South Asia, religious consideration; and in Japan, quality and regulatory compliance are prioritised. Whilst Japanese-made capsules remain at a limited share of 5 to 7 per cent in the global market as a whole, they have established a firm position in specific high-value-added fields where quality, data, and support are emphasised.