Unit to capture bioactive health opportunities

Fonterra business unit to capture bioactive health opportunities

Fonterra this morning opened its Health and Nutrition specialty ingredients unit in Auckland. The unit aims to become a leader in the development and commercialisation of bioactive ingredients for health and wellness.

It incorporates existing products from the three legacy companies and expects to double its earnings to US$40 million in three years.

Fonterra Chief Executive Craig Norgate says the Health and Nutrition unit will allow for tighter focus on bioactive ingredients research and ensures the company will become a leading speciality milk components innovator and solutions provider, one of the key themes from The Fonterra Strategy.

"Milk is a total health food product. Apart from the obvious benefits like providing daily calcium requirements, milk also contains bioactive components that can improve overall health, fight specific diseases and contribute to resolving health issues like arthritis," says Mr Norgate.

"The opportunities are virtually endless and we now have a strategy and discovery unit in place to identify, capture and maximise these opportunities. This will ultimately play a key role in increasing returns to shareholders and ensuring that we stay ahead of the competition.

"At the same time, we can improve the quality of life for consumers worldwide by unlocking the benefits of milk-derived bioactives," he says.

Key areas of focus include ingredients products aimed at showing benefits for the immune system, modified milks, bone health, dermatology, gastrointestinal, therapeutics, sports and animal health.

Mr Norgate says the bioactives market has huge potential.

"In the United States alone, we expect to see growth double to a value of more than US$60 billion in the next four years. By focussing on specialised research and development now, we will be well placed to capture a good share of this growth."

A number of projects are already underway, including the development of gastrointestinal anti-infective products that will aid in the prevention of stomach complaints. The products have already been developed and will head into clinical trials shortly.

The unit is headed by Patrick Geals, who has joined Fonterra from international pharmaceutical companies Novartis and Glaxo Smith Kline. The team also includes experts from within the health, nutrition, pharmaceutical and dairy industries.

Key markets for the specialty ingredients products include the United States, Japan, Korea, China,Taiwan and Malaysia. The market is also emerging in South America, Australia, the Middle East and New Zealand.

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