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Cholesterol is a fatty substance made by the liver and is vital for every cell of the body. As the body makes what it needs, we don't generally need to add cholesterol through the diet. However, many diets include foods rich in cholesterol such as foods high in saturated fats like pork, beef, sausages and dairy foods.
Red Yeast Rice contains small amounts of naturally occuring Monacolin K which appears to inhibit the action of an enzyme in the liver (3-hydroxy-3-methylglutaryl coenzyme A reductase) that is responsible for producing cholesterol.