Food Meets Pharma
By Elizabeth Esfahani

(Business 2.0) – The future of the $550 billion U.S. food industry? Nutriceuticals. The "functional" foods trend started five years ago with cholesterol-lowering spreads like Benecol, and the segment is climbing 8 percent annually. But the real boom is coming soon, thanks to relaxed FDA requirements: Food companies can now make "qualified claims" about ingredients—that is, suggestions, not guarantees, about their benefits. In September the heart-healthy virtues of omega-3 fatty acids from fish and algae were the first approved under the new rules. "We're going to see an explosion of functional foods," predicts analyst Kyle Stults of Wm Smith. Here's a look at the most promising (and potentially profitable) ingredients. — ELIZABETH ESFAHANI