BioGaia has been developing probiotic straws for several years but progress has been admittedly slow with sales at “low volumes” for three years in half a dozen markets.
But in the company’s Q3 results, which saw its operating profit surge 557 per cent from €330,000 to €1.84m, a recent deal was highlighted that sees its probiotic-laden straws being used with Nestlé children’s products called Boost Kid Essentials in the US.
Another partnership will see BioGaia supply Nestlé with its Lactobacillus reuteri probiotic strain for a new range of Nestlé infant nutrition products. Those products – NatureNes – will reach global markets in 2009.
Pro-straw
As a key developer the company is obviously pro-straw, but BioGaia’s managing director, Peter Rothschild, said better probiotic strain and straw technologies, along with a broader consumer acceptance of probiotics, were merging to heighten interest in the delivery mechanism.
“The technology has come on a lot so that the straws are delivering more and more,” Rothschild told NutraIngredients.com. “This year has been a breakthrough year – volumes have increased 10-fold. The Nestlé interest has been significant and now other major food companies are interested too. Next year is looking very good.”
Probiotic straws provide a clinical dose to a beverage at the point of consumption and, in theory, preserve the integrity of the ‘dorment strains’ that only become active when liquid is introduced to the straw.
Benefits include dose accuracy and extended shelf-life with BioGaia saying its straws can reliably achieve a shelf life of one year. He said a straw loaded with a clinical dose of about 100m active bacteria (or colony forming units) could be delivered for a few centimes a serving.
BioGaia recently launched a beverage under its own name in Japan that incorporates the probiotic straw. “Our research indicates Japanese consumers like the idea, they see the logic behind it and there is a little novelty value there too, which the Japanese are very fond of.”
BioGaia is developing a bottle cap that works on a similar delivery principle for the gut health and immunity boosting bacteria.
While its pharma and food supplements businesses remained the biggest part of BioGaia’s business, Rothschild said the potential of probiotic foods and beverages was increasing
“We are not noticing any negative effects of the financial crisis or market downturn, as our products are sold primarily via pharmacies and belong to a segment that is generally not as cycle-sensitive as many others,” he said. “We therefore look forward to continued strong growth.”
Packaging giant Tetra Pak, Danisco and Unistraw are other players in the probiotic straw area. Danisco and Unistraw recently teamed up to deliver a probiotic straw and Unistraw and Tetra Pak’s Tetra Brik Aseptic cartons will be able to carry the probiotic straws from mid-2009.
Q3
BioGaia’s Q3 results showed no signs of being affected by the global financial downturn with, with sales up 42 per cent to €10.62m in the nine months to September 30, compared to the same period in 2007.
Rothschild said the company’s near-debt free status and the Swedish banking sector’s relative stability meant the company had to date felt few effects of the financial crisis.
Euromonitor put the global market for probiotic dairy drinks at $10.2bn in 2007.