09.01.10
Almost a decade ago, Cognis separated from its parent company, Henkel, to become Cognis Corporation, which included the Nutrition & Health division. Today it has a new parent, BASF, who reached an agreement to acquire the specialty chemicals company in June for a total transaction value of €3.1 billion. Final closing of the transaction is expected in November 2010. While some acquisitions can prompt feelings of worry and anxiousness, Sharrann Simmons, North American marketing director, Cognis Nutrition & Health, is very upbeat about this latest development. “We look forward to a successful integration and quickly delivering value. The combination of BASF and Cognis will provide benefits and broader solutions for all our customers.”
According to BASF, the purchase of Cognis helps strengthen its position in personal care ingredients, home care and health and nutrition products. Also, because Cognis has a leading position in “green” products and sustainability, it provides BASF with a broader and more attractive offering of products and services that in today’s market are key in attracting new customers and maintaining existing ones.
During the last several years, Cognis Nutrition & Health has rolled out a massive campaign geared toward health, wellness and beauty. Under the tagline “Newtrition—Eat. Feel. Live.” the company continues to bolster its ingredient portfolio with new innovations, research and market-driven solutions. Some of its star ingredients include: Covitol natural vitamin E, Heart Choice natural phytosterols, Tonalin CLA, Xangold natural lutein esters, Omevital omega 3 and Covi-Ox natural antioxidants.
Hoping to add to this list, the company continues to collaborate with InterMed Discovery (IMD), a research partner it joined forces with in early 2008. InterMed’s role is to screen natural product candidates for Cognis that are applicable to the life science, food and cosmetics fields. Most recently, the collaboration birthed two new natural product candidates for weight management and cognitive performance. Cognis plans to carry out in vivo tests and research studies for these ingredients later this year.
Cognis has already licensed four other ingredients from IMD targeting weight management and heart health. Clinical studies for one of these projects will begin later this year. The other licensed ingredients are currently in advanced preclinical testing and scale-up process.
Eventually these ingredients will be developed for use in functional foods, supplements and cosmetics, which are primary market targets for Cognis. In fact, Ms. Simmons points out, more than 50% of the company’s portfolio in North America is geared toward supplements, although most of the growth and development is taking place in functional foods. Discussing the latter, she said, “The challenge with functional foods is educating consumers about the value of that food because there will always be a price premium when adding a functional ingredient. The good news is if consumers have a good understanding of the value and health benefits they will pay premium prices.”
Cognis has been busy outside the U.S. as well, particularly in Asia and Latin America. “In terms of the last three years, our business has grown tremendously in China, India and Latin America,” Ms. Simmons said. “Due to this growing business we have established offices in some of these emerging markets.”
In these parts of the world, Cognis is focusing heavily on regulatory approvals, where in some cases it has taken up to three years to gain access in some markets. “The approval process is changing around the world and companies need to be prepared to meet the high hurdle in terms of safety and efficacy,” Ms. Simmons commented.
However, although the approval process requires a large investment of time, money and resources, Ms. Simmons believes the efforts are well worth it. “Looking at functional foods, we wanted to make sure we had the right products and approvals in place,” she said. The recent Novel Foods approval for plant sterols in Canada is just one example of how expanding regulatory approval is paving the way for the launch of new functional foods that resonate with consumers. Last year, Cognis also obtained regulatory success in China where Tonalin CLA now has Novel Foods approval.
For the future, Ms. Simmons anticipates a lot of growth coming from outside the U.S. “There is huge growth potential outside the U.S. market,” she said, adding that multi-level marketers (MLMs) are already very active in getting their products into these developing regions. And she believes Cognis can do well anywhere “because our customers see the value in what we do.”—R.W.
Cognis Nutrition & Health
5325 S. Ninth Avenue
La Grange, IL 60525
Telephone: 708-579-6204
Fax: 708-579-6152
E-mail: sharrann.simmons@cognis.com
Website: www.cognis.com
