Today, on October 13th, the 8th China Cosmetics Trends Conference (2023), organized and jointly hosted by CHAILEEDO Intelligence and CHAILEEDO, in strategic cooperation with Bathfeel and for/get, was held in Guangzhou. The conference, centered around the hot trend of “Chinese ingredients” in the Chinese cosmetics market in recent years, featured discussions on this theme. During the conference, Chinese skincare brands focused on skin youthfulness, such as for/get, the leading Chinese efficacy skincare brand BTN, the leading brand in domestic licorice-based whitening products Grain Rain, as well as Readline, the pioneer in green active ingredients, and Trautec, the leading platform in the synthetic biology industry, as well as Yatsen Holding and Mentholatum, shared their unique insights on Chinese ingredients. The discussions revolved around the shift from “Copy to China” to “Copy from China” in the cosmetics industry, exploring how Chinese ingredients can achieve breakthroughs.
R&D will be the main theme in the industry for the next 2-3 years
There has long been a misconception about the cosmetics industry: that scientific research is a false proposition and that the technological content in cosmetics is low.
In reality, within the context of global economic development, technology has always been the primary productive force, which also holds for the cosmetics industry. Research and development play a crucial role in driving innovative product development, improving product quality and safety, and staying in line with market trends.
During his keynote speech at this conference, Zhaoyang Cai the co-founder of CHAILEED, summarized the current trend of investment in scientific research in the beauty industry with four words: “Go with the flow.” Zhaoyang Cai believes that “R&D will be the main theme in the industry for the next 2-3 years, and the competition among beauty brands in scientific research has become highly intense. Whoever can tell a compelling scientific research story will be able to tell a compelling brand story.”
During the conference, Wang Nailong, the General Manager of R&D at Mentholatum (China), summarized several important global personal care research and development trends.
The first and most important trend is the focus on safety and stability. For consumers, safety is always the primary consideration when purchasing cosmetics. Transparency and the source of ingredients are key points of communication regarding safety. Ensuring safety and stability requires rigorous testing and evaluation of products in scientific research to guarantee their safety, stability, and quality. The keyword for safety has shifted from natural sourcing and plant-based ingredients to stability. It is not only about the safety of the ingredients sources but also about ensuring that the final product has no adverse effects on the skin.
The second trend is the focus on consumer experience and emotional aspects, moving from a simple emphasis on “beauty” to multidimensional development centered around “health.” The third important trend is the emphasis on product efficacy. The fourth trend is the focus on skin health and microbiome-friendly formulations. Skin health and barrier damage have gradually become consumer concerns, and they are associated with various skin issues. Natural, green, and sustainable development are also important trends in the cosmetics industry. Wang Nailong stated that sustainable strategies will become a key competitive factor for global beauty brands in the next 3-5 years.
During the conference, Cheng Jing, the Chief Scientific Officer of Yatsen Holding, the youngest beauty and cosmetics listed company in China, presented the global perspective on beauty and cosmetics research and development trends. Using Yatsen Holding as an example, Cheng Jing shared the impact of scientific research on the cosmetics industry.
Regarding the research and development trends in color cosmetics, Cheng Jing stated that the functional claims penetration rate of Chinese color cosmetics products is lower than that of other mainstream global markets. The innovation trend in color cosmetics has transitioned from being color-centric to a combination of “color + skincare + efficacy.” Additionally, the development of biotechnology, such as synthetic biology, bioprocess engineering, breakthroughs in single-cell sequencing technology, and genomics, can contribute to the advancement of functional color cosmetics.
In the thriving field of biotechnology, Yatsen Holding has already established platforms for bioprocess engineering, synthetic biology, plant biotechnology, biomimetic technology, and fundamental biological research.
Anti-aging has always been a hot topic of concern for cosmetics consumers. Ren Hankun, the Executive Deputy Director of the Expert Committee of the Chinese skincare brand For/Get, delivered a keynote speech on the breakthroughs in anti-aging ingredients in China at the conference.
Ren Hankun stated that aging, specifically photoaging, accounts for 80% of the aging process. The key to anti-aging is to extract the core indicators that influence youthful and healthy skin from the complex and real state of the skin, focusing on the “20%” core indicators to improve the “80%” skin issues.
One important breakthrough in anti-aging ingredients is μ-conotoxin (peptide), which originates from cutting-edge technology in Switzerland and is developed by Swiss laboratories with a background in biotechnology and pharmaceutical research. It has a mechanism of action that provides non-invasive cosmetic effects (strongly supporting anti-wrinkle claims of highly efficient “light medical beauty” skincare products). Another important anti-aging ingredient is Palmitoyl Pentapeptide-4 (3 ppm). Relevant studies have shown that Palmitoyl Pentapeptide-4 (3ppm) achieves the same skin improvement effects with less than one percent of the dosage of retinol (700ppm).
Ren Hankun mentioned that the core technology of Anti-AGE is the Nano-Ethosomes Tech, a carrier technology using nano-ethosomes. It replaces traditional liposomes with low-molecular-weight polyols instead of cholesterol, encapsulating and delivering active ingredients such as XEP-018, Palmitoyl Pentapeptide-4, and Dendrobium Polysaccharide DHA, thus significantly enhancing stability and bioavailability.
Wang Feifei, Vice President of BTN, the first publicly listed company specializing in functional skincare products in China, delivered a keynote speech at the conference on the topic of establishing a research path for China’s skin health ecosystem, highlighting the importance of research and development for Beterney.
“Approaching skincare with a pharmaceutical mindset” is the foundation of BTN’s positioning as the world’s leading provider of functional skincare products. What sets Beterney apart from other brands is its use of unique botanical ingredients sourced from Yunnan Province.
The confidence of BTN stems primarily from the professional and authoritative research expertise of its founder, Mr. Guo Zhenyu. With a Ph.D. from McGill University and a postdoctoral fellowship from the University of Western Ontario, Mr. Guo is also a senior researcher at the Montreal Clinical Research Institute, boasting extensive scientific and research background.
To enhance product efficacy, BTN follows a rigorous and meticulous process, starting from pre-research before project initiation, ensuring safety control during raw material selection, conducting formula development, and concluding with product evaluation to guarantee safety and compliance. Moreover, Beterney undertakes in-depth fundamental research to support product innovation, including skin physiology/pathology, Yunnan-specific plant research, and evidence-based medicine.
Wang Feifei concluded by emphasizing that, as researchers, crafting products with a craftsman’s spirit and gaining consumer recognition is the greatest reward for R&D professionals.
The role of research and development in the cosmetics industry is unquestionable, not only in the development of new products but also in ensuring product safety. As Ren Hankun mentioned, “Engaging in scientific research is not about showing off technology or simply accumulating research and technology. It is about finding the relationship between the brand and consumers through scientific research, and truly establishing a brand’s presence in the minds of consumers.” This also demonstrates that regardless of the industry, the ultimate purpose of research and development is to translate its achievements into products and deliver them to consumers. That is the ultimate goal.
China’s synthetic biology leads the trend in cosmetic ingredients
From an overall perspective, cosmetic ingredient development technologies can be classified into four main types, including chemical synthesis, biological extraction, bioprocessing, and biosynthesis. In recent years, due to consumer preference for natural and organic materials, synthetic biology has become a key focus in the development of the cosmetics industry.
At this conference, Dr. Fu Shengwei, a scientist from the leading domestic synthetic biology industry platform, the Trautec Advanced Technology Research Center, delivered a keynote speech on the topic of synthetic biology and cosmetic ingredient development, providing profound insights into the impact of synthetic biology on the cosmetics industry.
In the development of cosmetic ingredients, traditional sources mainly relied on plant and animal extraction. However, plant and animal extraction face challenges such as difficulties in sourcing, low yields, significant batch-to-batch variations, and high costs associated with chemical synthesis.
In the current industry trend, Environmental, Social, and Governance (ESG) factors have become a social responsibility priority for leading cosmetics companies. They are actively seeking more sustainable alternatives. Synthetic biology offers a green alternative solution. Therefore, there is a growing focus on using synthetic biology to construct cell factories for production, replacing traditional plant and animal extraction methods and chemical synthesis. This approach aims to increase production yields, reduce manufacturing costs, and enhance batch-to-batch consistency, which are key priorities for cosmetic companies today.
In the development of new cosmetic ingredients, there is a need for clear efficacy requirements such as whitening, moisturizing, anti-aging, antioxidant, and soothing effects. Artificial intelligence is utilized to rationally design molecules, peptides, and proteins targeting specific molecular targets. Synthetic biology is employed to construct cell factories for the production of these new ingredients.
Dr. Fu Shengwei shared several representative cosmetic ingredients produced through biosynthetic methods, including squalene, peptides, madecassoside, hyaluronic acid, and collagen. China has achieved a leading position globally in the development of collagen, peptides, and hyaluronic acid, which provides important confidence for the country to reduce reliance on foreign cosmetic ingredient imports.
China is the first country globally to achieve large-scale production of recombinant collagen and holds a leading position in the industry. According to Frost Sullivan, the market size of recombinant collagen products in China increased from 1.5 billion RMB in 2017 to 10.8 billion RMB in 2021, with a compound annual growth rate of 63%. The institution predicts that the market size will further increase to 108.3 billion RMB in 2027, with a compound annual growth rate of 42.4% from 2022. The penetration rate of recombinant collagen in the market increased from 15.9% in 2017 to 37.7% in 2022, and the institution estimates it will reach 62.3% in 2027. Recombinant collagen skincare products are the fastest-growing segment in China’s functional skincare market, with an estimated size of 30.8 billion RMB in 2021. Collagen, with its advantages in repair, anti-aging, and whitening, is expected to reach 64.5 billion RMB by 2027, surpassing hyaluronic acid.
In the capital market, several companies in China specializing in recombinant collagen have gone public. One of the largest companies in terms of recombinant collagen production capacity, Giant Bio, was listed on the Hong Kong Stock Exchange late last year, specifically on November 4, 2022. Giant Biogene’s recombinant collagen products are primarily used in the field of skincare and it is one of the first companies globally to achieve large-scale production of recombinant collagen cosmetics. Giant Bio has eight major brands under its umbrella, covering various applications such as cosmetics, medical dressings, intimate care, oral care, scar repair, and more.
In July of this year, Jinbo Bio also went public on the Beijing Stock Exchange. The company has completed basic research on humanized collagen types I, III, and XVII, and has applied them in multiple fields including gynecology, dermatology, surgery, otorhinolaryngology/dentistry, and skincare. Jinbo Bio’s goal is to develop all 28 types of human collagen and accelerate the original development of recombinant humanized collagen.
Domestic beauty brand Marubi has successfully developed stable recombinant dual collagen, which combines type I and type III collagen. The amino acid sequence of this protein is identical to that of natural collagen in the human body, offering advantages such as fast absorption, effective results, and high safety. The company’s skincare brand, “Wanmei,” has been developed for many years, forming a rich product range. The latest introduction, the Dual Collagen series, represents the main product line showcasing the technology of recombinant dual collagen.
As one of the important players in the domestic recombinant collagen industry, Trautec, attending this conference, has received investments from international beauty giants Shiseido and LVMH, which is a testament to the significance of recombinant collagen in the beauty industry.
Regarding the peptide market, Huang Hu, the CTO and Global Chief Scientist of Shanghai Chicmax, gave a presentation at this conference on the research trends of “peptides” in China. Huang Hu stated that retinol, peptides, and boswellia are the three recognized anti-aging powerhouses in terms of registration and consumer acceptance. Mild anti-aging properties are more suitable for Asian skin, and peptides are favored by brands due to their low effective concentration and gentle nature, indicating that there is limitless potential for peptide-based anti-aging products. Data shows that the anti-aging market in China reached a scale of 82 billion yuan in 2021 and is expected to increase to 153.2 billion yuan by 2026. Anti-aging has become an essential skincare need.
Huang Hu mentioned that KANS has had a connection with peptides since the beginning. Looking back 20 years ago when the Chinese cosmetics industry was just starting, everyone was contemplating how to use peptides. Last year, we took the lead in developing the group standard for synthetic peptides used in cosmetics, which provides clear directions and guidelines for the research, production, and efficacy evaluation of peptide ingredients, aiming to further standardize the development of the peptide track in China. In 2003, KANS established its first production base, focusing on anti-aging ingredients, particularly peptides. In 2023, KANS took the lead in drafting the group standard for Cosmetic ingredients – Peptides.
According to data from Frost Sullivan, the global market size of peptide cosmetic ingredients maintained a compound annual growth rate of 16.8% from 2016 to 2021. It is projected that the global market size of peptide cosmetic ingredients will reach $1.45 billion by 2025 and $1.97 billion by 2030.
China is an indispensable part of this market, with the market size expected to continuously expand at compound annual growth rates of 12.5% and 6.9% from 2021 to 2030. It is estimated to reach approximately 2.32 billion yuan by 2025 and is expected to reach 3.24 billion yuan by 2030. By 2022, the Chinese market for peptide cosmetic ingredients is expected to reach 22.5% of the global market size, demonstrating China’s leading position in this market.
In addition, regarding squalene as a cosmetic ingredient, in September of this year, Yichun Dahaigui Life Science Co., Ltd signed a listing guidance agreement with Huatai United Securities, officially embarking on the path to going public.
Yichun Dahaigui specializes in the production research and development of various high-end cosmetic and biopharmaceutical ingredients, with non-olive plant-derived squalene being one of its featured materials. According to publicly available information, Yichun Dahaigui currently accounts for approximately one-third of the global squalene production and owns skincare brands. In 2018, Yichun Dahaigui established a squalene production line, achieving mass production of squalene and squalane products, which are sold to regions such as Japan and Europe. It is reported that Yichun Dahaigui ranks among the top in terms of global squalene production capacity.
Lastly, regarding ergothioneine, Fang Xin, a senior scientist, and Vice President of the Product Center at Readline, a leader in green active ingredients, gave a keynote speech on the role of ergothioneine in cosmetics.
Ergothioneine is a natural ingredient with excellent antioxidant properties in skincare products. Its scientific name is L-thio-γ-glutamyl-L-methionine trimethylamine. Due to the strong acceptance, absorption, and utilization of ergothioneine by skin tissue cells, it has been widely used in the cosmetics industry. Estée Lauder considers ergothioneine as its signature ingredient, and its brands such as Clinique, Origins, and La Mer extensively use ergothioneine as an important component.
In the domestic market, popular products such as the fifth-generation Time Freeze Revitalizing Repair Essence by CHANDO, and Proya Fresh & Smooth Wrinkle Lifting Moisturizer, all contain ergothioneine. Additionally, there are skincare products directly named after ergothioneine in the market, such as Biophyto-genesis Aidiben Ergothioneine Night Repair Cream and HBN Ergothioneine Radiance Essence.
Ergothioneine not only has antioxidant effects but also combats glycation, brightens the skin, defends against radiation, reduces wrinkles, eliminates acne and eye bags, tightens pores, and slows down the aging process. Furthermore, ergothioneine also plays a role in preventing hair loss, promoting hair regeneration, and improving hair quality.
As a leader in domestic green active ingredients, Readline’s ergothioneine raw material has long been internationally recognized. In 2021, the 17th “Jungle 2021 Personal Care Industry – Technical Innovation Award” ceremony was held at the Kerry Hotel Pudong, Shanghai. In fierce competition, Shenzhen Redline “ergothioneine” stood out in the functional ingredient category with its outstanding advantages in technological innovation, stable quality, residue-free safety, and green environmental protection, successfully winning the Technical Innovation Award.
Overall, the confidence and ability of the Chinese cosmetics industry to propose the concept of “Chinese ingredients” is determined by China’s leading position in synthetic biocosmetic ingredients. At a deeper level, it is because more plant ingredients with Chinese characteristics are gradually being discovered and utilized.
From Copy to China to Copy from China
As the most upstream sector of the cosmetics industry, ingredients are not only the foundation for ensuring the quality of beauty products but also the source of product differentiation. Historically, China’s cosmetics ingredients have been dominated by international material giants. Fortunately, with the emergence of favorable new regulations and the registration and filing of new materials, domestically produced cosmetics are gradually gaining control over the raw material supply.
As of the third quarter of this year, according to data from the National Medical Products Administration, 35 domestic cosmetics have been filed, with 26 of them coming from Chinese companies, accounting for a significant 74.3%. This indicates that Chinese cosmetics ingredients are gradually reducing their reliance on foreign sources.
The ability of Chinese cosmetics ingredients, or “Chinese ingredients,” to confidently propose a shift from “copy to China” to “copy from China” can be attributed to two main reasons.
One reason is that China is gradually exploring plant materials with Chinese characteristics.
Wang Feifei, Vice President of BTN, stated at this conference that the most important factor that sets BTN apart from other brands is the use of distinctive plant materials from Yunnan.
Among BTN’s unique plant materials are PrinsepiautilisＲoyle, Portulaca oleracea, and Yunnan Camellia. PrinsepiautilisＲoyle is sourced from the Shangri-La snow mountain at an altitude of about 3,200 meters, and it contains powerful vitality and repair capabilities. Portulaca oleracea is an annual herbaceous plant, and BTN extracts the essence of Portulaca oleracea using patented extraction technology. It effectively alleviates skin irritation, enhances skin tolerance, and reduces sensitivity due to its anti-inflammatory and anti-allergic properties. Yunnan Camellia grows at an altitude of about 2,800 meters. After five years of research, BTN’s laboratory has maximized the beauty effects of its flowers and seeds. The petal extract makes the skin translucent and radiant, while the seed extract makes the skin moisturized and translucent.
Li Li, the founder of the BATHFEEL brand, highlighted the unique Chinese plant ingredient, Red Pine Nut Oil, in her keynote speech on “Root-Seeking,” a cutting-edge brand focused on Chinese ingredients. Red Pine Nut Oil is rich in unique pinoresinol and unsaturated fatty acids and is mainly found in China’s Changbai Mountains, Jilin, and the Greater and Lesser Khingan Mountains.
Li Li explained that common skincare issues among Oriental women include underdeveloped sebaceous glands due to genetic factors, excessive cleansing, and body care products that do not address practical problems resulting in dullness, dryness, bumps, and itchiness. Therefore, she believes that body skin is more prone to dryness compared to facial skin. BATHFEEL incorporates a high proportion of natural plant oils into its products, which are “sebum-like films” that are readily accepted by the stratum corneum.
In addition, Lin Yuting, co-founder of GrainRain, a leading domestic brand in whitening products featuring Chinese licorice, also highlighted the Chinese characteristic of Glycyrrhiza glabra in her presentation at the conference. Guri’s research has found that the stratum corneum of Chinese individuals is relatively thin, highly photosensitive, and susceptible to external stimuli, making it more prone to darkening. In contrast to the direct and intense approach of Western chemical treatments, the power of Oriental plant extracts appears to be gentler yet potent. Glycyrrhiza glabra is safe and gentle, does not require tolerance building, can be used without avoiding sunlight, and a single ingredient can achieve efficient whitening through four major pathways.
Lin Yuting stated that GrainRain’s ingredient catalog currently includes 119 plant ingredients, with 12 unique to China, including Glycyrrhiza uralensis, Chinese Lingzhi, Chinese ginseng, peony, osmanthus, Rehmannia chinensis, Houttuynia cordata, soapberry, Salvia miltiorrhiza, Lycium barbarum, mulberry, and Guangxi sand mandarin. These ingredients are unique Chinese plant ingredients that urgently need to be explored and are more suitable for Chinese consumers.
Overall, in the Chinese cosmetics industry, both mature and emerging brands are seeking Chinese characteristic plant materials and developing products that are more suitable for Chinese consumers.
In addition to continuously seeking Chinese characteristic plant materials, infusing Chinese cultural connotations into products is also one of the important reasons why the Chinese cosmetics industry has the confidence to say “Copy from China.”
Wang Nailong, the R&D General Manager of Mentholatum (China), emphasized at the conference the importance of rooting down as a Chinese brand, incorporating Chinese ingredients, and Chinese formulas. It signifies that it is crucial for the Chinese cosmetics industry not only to create brands and products but also to infuse Chinese culture into them.
Li Li, the founder of the BATHFEEL brand, believes that Oriental culture is of utmost importance on the path to high-end Chinese brands. In product development, it is essential to not only focus on exploring Chinese culture but also on promoting it.
“Today, when we talk about Chinese ingredients or Chinese treasure ingredients, it is essentially not just about discovering China’s treasure ingredients, but about paying attention to the people behind Oriental ingredients and exploring Oriental culture. This is the only path for us to differentiate ourselves and create high-end brands that can command higher prices,” said Li Li.
Lin Yuting, co-founder of GrainRain, stated that the name “GrainRain” is a familiar Chinese-style name to Chinese consumers. The cultural essence of the 24 solar terms, including the Grain Rain, flows in the genetic makeup of every Chinese person. Being a Chinese brand named after a solar term, Guri’s meaning is deeply rooted in the starting point and origin.
“The younger generation’s love for traditional Chinese culture is growing, and their pursuit of Chinese ingredients is becoming more profound. Therefore, Chinese brands’ demand for product safety and natural ingredients is also increasing,” added Lin Yuting.
Infusing products with more cultural attributes is an important part of the path to high-end Chinese brands. Chinese brands have long been seen as substitutes for foreign luxury brands, unable to truly reach the high-end market. As Li Li mentioned, the essence of Chinese ingredients should focus on the Oriental people and the Oriental culture behind them. Only on this basis can Chinese brands embark on the path to high-end success.
Since its development, the Chinese cosmetics industry has gone through stages of foreign capital influx, the rise of emerging brands, and the current flourishing of diverse brands. With the reliance on Chinese characteristic plant materials and the cultural significance behind the products, the Chinese cosmetics industry has shifted from “Copy to China” to “Copy from China.”
