Size of the Market:

Perhaps the best "third party" information that we would recommend regarding the size and demographic profile of the Osteoporosis market can be found on the website of the World Health Organization (WHO) (http://www.who.int). Secondarily, we would recommend one website link of the Canadian Osteoporosis Society (www.cma.ca/disease/osteo_pl/).

On the WHO website you will be able to access a press release issued by the WHO in October 1999. To summarize, this press release notes that "the number of hip fractures worldwide due to osteoporosis is expected to rise three-fold by the middle of the next century, from 1.7 million in 1990 to 6.3 million by 2050… Demographic changes over the next 50 years will lead to unprecedented increases in the number of the elderly in Asia…Annual direct medical costs to treat 2.3 million osteoporosis fractures in Europe and in the U.S.A come up to US$ 27,000 million…. WHO's recommendations to the general public include…a balanced diet providing intake of at least 800-1500 mg per day in children and adults…" At your request, we can forward a copy of this press release to your attention under separate cover.

In addition, the WHO website has provided statistical data pertaining to the aging population in Japan. According to their statistics, in 1999, 22.6% of the population was in the 60+ years age category. This is a significant increase over the 17.4% of the population noted in 1990.

The Canadian Osteoporosis website link will provide you with a copy of the "Consensus statements from the Scientific Advisory Board of the Osteoporosis Society of Canada: Prevention and management of Osteoporosis". It is critical to recognize that the source of the information is the Canadian Medical Association. This information is important as it clearly outlines why osteoporosis is a condition of women. It also recommends prevention and or treatment strategies that provide the rationale for why the calcium/magnesium/vitamin D supplementation market continues to expand. In addition, these recommendations and the clinical research outline some of the current problems associated with leading "brands" of cal/mag preparations. Again, at your request we can forward a copy of this information to your attention under separate cover.

We believe that after reviewing this information buyers will clearly understand the current size of the market, and, given the current demographic trends pertaining to the aging population, they will see what the future holds.

At this time, we have no specific data pertaining to the Cal/Mag market in Japan. However, based on a 1999 report on the Pharmaceutical Industry in Canada by IMS (a Dunn & Bradstreet Company) we do know that for the prevention and or treatment of Osteoporosis in Canada, physicians recommend or prescribe a calcium/magnesium supplement no less than 2 million times per year. This corresponds to a 4-year average compound growth rate of 13%. With a government mandate of a shift from prescription to over-the-counter purchases, especially regarding the prevention of osteoporosis, we anticipate that the overall calcium/magnesium market is very healthy in Canada.

This premise has been recently substantiated in an AC Nielsen report that included data pertaining to the grocery sales of nutritional supplements in Canada. In the 52 weeks ended June 17,2000, the sales of calcium/magnesium supplements in the grocery retail channel exceeded $6.4 million CDN, a dollar and physical volume increase of over 30%.

Data compiled and reported in Natural Foods Merchandizer Magazine indicates that the grocery retail channel is the least productive channel for the sale of vitamin/mineral supplements in terms of volume and percent growth.

Under separate cover, we will forward this information to your attention.

Leading Calcium/Magnesium Brands:

At this time, data is only available for the largest Mass-Market retail channel in Canada, the pharmacy market. Brands and "generic versions" that contain primarily Calcium Carbonate are the products that are currently most recommended by physicians and pharmacists. This is regardless of the fact that Calcium Carbonate has such a poor absorption profile and the fact that patient acceptance of these formulations is poor. However, at this time brand options are limited. These brands include: Caltrate, Calsan, Gramcal and Os-cal.

What is responsible for the market growth?

The primary vehicle driving market growth is consumer/patient awareness and education pertaining to the prevention of Osteoporosis. This is a mandate that is heavily funded by governments, insurance companies and pharmaceutical houses as well as established patient and medical advocacy groups and associations (e.g. Osteoporosis Societies (regional, national and international), Canadian Medical Association, WHO, etc.)