Kirin Holdings is developing new skin care products by leveraging subsidiary Fancl’s expertise as part of its strategy to become a leading health science company in the Asia-Pacific region.
The Japanese brewery group, which completed its ¥230 billion ($1.5 billion) acquisition of Fancl earlier this year, plans to target the growing “dermocosmetics” segment that blends skincare with nutritional supplements. Products are expected to launch in Japan by 2026 before expanding across Asia.
After acquiring a 33% stake in Fancl for approximately ¥130 billion ($873 million) in 2019, Kirin converted it into a wholly owned subsidiary this year. The integration gives Kirin access to Fancl’s 2.8 million customers and proprietary technologies.
Following the tender offer completion in September, executives from both companies created about 30 joint initiatives, with skin health products identified as the most critical opportunity.
The move comes as Kirin attempts to diversify beyond its core beer and beverage operations. The global supplements market reached $132.4 billion in 2023 and is projected to hit $150 billion by 2029, while the cosmetics market is forecast to exceed $220 billion by 2028, according to Euromonitor.
However, analysts remain skeptical about Kirin’s health science ambitions. JPMorgan’s Satoshi Fujiwara cited concerns about unclear synergies and regional strategies, particularly questioning how Fancl’s cosmetics business aligns with Kirin’s operations.
After three consecutive years of losses, Kirin expects its health science division to become profitable this year. The company projects the segment will generate ¥30-33 billion ($201-221 million) in profit by 2030, representing about 10% of group revenue.
