Post on 25-Feb-2016
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Innovators and Entrepreneurs of MSPApril 24, 2014
The Health & Nutrition Markets Commercialization of Value Driven Products
Commercializing an Ingredient Start Up
• An Insatiable Market
• The Right to Succeed
• The Commercialization Scope of Work
• Commercial Successes
An Insatiable Market
Nutraceuticals – An Insatiable Market
One of the fastest growing industries in the world is the nutritional supplement group, or more broadly known as Vitamins, Minerals and Supplements, or VMS. Producing about $32 billion in revenue for just nutritional supplements alone in 2012, it is projected to double that by topping $60 billion in 2021 according to the Nutritional Business Journal.
According to Partnership Capital Growth partner Brian Smith, a leading industry expert since 2000, the reason for the growth is it has gone mainstream. “Ten years ago, it was just the muscle heads and the weekend warriors. Now, it’s the full spectrum with men and especially women,” he said.
Additionally, the Cosmecetical market has grown over the past 5 years at an 11% clip – to a level of $5 Billion annually. Companies in this industry manufacture cosmeceuticals, which are cosmetics with pharmaceutical capabilities. Some of the most popular products include wrinkle-reducing moisturizers and creams that even skin tone.
According to Euromonitor, the functional food and beverage market has reached the level of $176.7 Billion in global sales, representing 5% of the total food market worldwide. Consumer demand for nutritious food solutions and unique delivery systems for efficacious ingredients is driving the market.
Uncovering the Right to Succeed
Creating a Right to Succeed
The following key steps are instrumental in developing the Nutraceutical and Food and Beverage markets for nutritive and/or functional ingredients… Performing a comprehensive analysis of the product’s
core functionality Identifying the range of relevant product applications
that best leverage the ingredients inherent value Isolating a Value Proposition with measurable value
drivers
Creating Go To Market and Entry strategies across a wide variety of relevant markets
Executing on a comprehensive strategic marketing plan aimed at maximizing exposure and extending reach to the target market.
Selling the relevant markets through the execution of targeted sales and marketing strategies and game changing strategic alliances
Ultimate success is directly related to sound, relevant applications development work and the creation of a marketable value proposition that clearly demonstrates value to the end user.
“ The people at Ingredient Technologies have been instrumental in identifying and correlating our product performance to achieve the maximum inherent value of our ingredients. With their help we have broadened the core applications for our products and identified new opportunities for growth .”
Carl PacificoBusiness Development Director Balchem Corporation
The Commercialization Scope of Work
The Scope of Work
I Feasibility & Market Readiness Concept Feasibility
- Confirm Source of Supply o Availability o Input Costs
- Determine the Optimal Product Format
o Isolated Extract o Inert Carrier
- Determine and Analyze Competitive Ingredients
o Known to Express Similar Efficacy o List of Sources & Distributors o Pricing & Pack Sizes o Specifications and Quality Parameters o Terms of Sale o FDA Warning Letters if Applicable o Contrast with Initial Research and Findings
Identify and Commercialize the Supply Chain
- Develop the Supply Chain Required to Produce a Commercializable Ingredient o Extraction of the active o Purification and/or Concentration o Drying o Packaging o Quality Assurance
The Scope of Work
II Market Development & Entry Plan
Market & Product Application Research
- Application Research o Commercial Fit o Required Functionality o Optimal Formulations
- Validation of Core Applications o Food & Beverage
Bakery & Bar Products Dairy Beverages Functional Food & Beverage Etc
o Nutraceuticals Dietary Supplements Suspension Liquids
o Pharmaceutical OTC Tablets Other OTC Applications
The Scope of Work
II Market Development & Entry Plan (Continued)
- Competitive Assessment o Competitive Benchmarking & Value Driver Assessment
Performance Benefits Stability Pricing Availability
o Execute Test Applications with Food and Beverage Manufacturers Prove out Performance Provide the Data for Fact Based Sales Tools
- Regulatory Requirements
o NDI o GRAS o Foreign Markets
The Scope of Work
II Market Development & Entry Plan (Continued)
Strategic Market Entry Planning
- Volume & Revenue Assessment by Market o Food & Beverage Industry
All Segments o Nutraceutical Industry
All Segments o Pharmaceutical Industry
OTC Market
- Develop Go To Market Strategies By Market o Food & Beverage o Nutraceutical o Pharmaceutical
- Comprehensive Marketing Strategies & Tactics
o Comprehensive Marketing Plan o Pricing Strategy o Product Application Platform Development o Sales Tools & Execution Plan
The Scope of Work
II Market Development & Entry Plan (Continued)
- Identify and Determine Optimal Market Penetration Strategies o Develop the Markets through a Strategic Distribution Network
Global Presence Agreements by Market Generally the Best Strategy for Nutraceutical Market
o Direct Sales to Food and Beverage Manufacturers Middle Market Large Multi-Nationals Direct Approach Where it Makes Sense
o Execute a Technology Transfer License Leading Nutraceutical Ingredient Company Leading Pharma Company
- Prioritize Sales Approach Based on Key Factors
o Overall Market Demand o Speed to Market o Value Proposition Potential o Resource Requirements o Competitive Landscape o Return on Investment
The Scope of Work
III Strategic Sales Execution and Ongoing Support Sales Execution
- Leverage the New Technology Adoption Process o Awareness and Knowledge o Interest and Evaluation o Trial and Adoption
- Develop Effective Selling Materials
o Value Proposition Based Selling System o Proven Case Studies o Product Technical Data Sheets
- Product Sales Strategy Execution
o Targeting and Prospecting o On-Going Sales Development o Account Management o Database Management & Reporting on Prospects and Customers
Strategic Counsel to Management
- Provide Counsel to the Management Team on all Relevant Areas of Expertise o Business Model Development o Supply Chain o New Markets of Entry o Ongoing Pricing Strategy
Commercial Successes
Relevant Commercial Successes
Shoreline Fruit, LLC• Developed the Strategic and Tactical Plan to Enter the Food and Nutraceutical Markets for the Leading Marketer of Tart Cherries in North America
• Developed Raw Material Extract Products with Standard Antioxidant Levels From Raw Material Bi-Product (Anthocyanins, Polyphenols)
• Executed the Plan and Achieved Global Distribution within first Year with Annual Estimates of $2-$3 Million in Sales by Year 2
• Developed Multiple Product and Applications from Tart Cherry
• Concentrate• Powder Extracts• Chewable Tablets• Animal Health Products• Etc.
Relevant Commercial Successes
BioEnvelop Agro • Developed the Business Model to Launch a Line of Nutraceutical and Pharmaceutical Products From Dairy Protein Based Gel Technology
• Commercialized Multiple Products from their Technology Platform
• Edible Film• Drug Delivery• Bari-Kade Film• Teeth Whitening System• Drinkable Gels
• Achieved Revenues of $3.5M in First Year
• Led by Sales of Melatonin Strips to Jamieson Labs
• Company was Sold to a Canadian Pharma Company – Paladin Pharmaceutical
Relevant Commercial Successes
Tersus Pharmaceuticals • Developed the Business Model to Launch a Purified Palmitoleic Acid Product called Provinal™.
• Set up International Distribution for Tersus to Quickly Penetrate the Dietary Supplement and OTC Pharma Markets
• Achieved $1,000,000 in Sales in Initial Year of Operation
• Product Shows Significant Lipid Management Benefits in Raising HDL, Lowering LDL, and TG
• Product Featured on Dr Oz in late 2013.
Relevant Commercial Successes
CK Nutritional Ingredients • Supported Company’s Business Development Efforts in
the US Market• Company based in Toronto, CA• Market a Number of Specialty Nutraceutical
Ingredients
Balchem Corporation • Applications Development & Strategic Sales Support in
Food and Nutraceuticals• Balchem is a Public Company with Sales in Excess of
$100M• IT Played a Critical Role in Developing New
Opportunities for their Products
BioSym Technologies• Developed Market for North America for Nutraceutical Raw Materials
• Assisted in the Development of Fermentation Based CoQ10 Compound
• Spearheaded Strategic Alliance with leading Distribution Company
• Estimated Sales of Over $12M in 2nd Year on CoQ10• In Negotiation to Market Technology Licenses
Corporate Contacts
Ingredient Technologies has successfully sold ingredients to the world’s industry leaders in Nutraceuticals, Food, and Pharmaceuticals.