“When I came on board with Stepan, after 11 or 12 years with Roche and then DSM and after working with Cognis in their omega-3s business, they had just acquired the lipid nutrition business. After the integration was complete at the beginning of last year we brought in a consultant to consider how we might reposition the ingredient,” Bailey told NutraIngredients-USA.
Bailey said the timing of the launch into the US was complicated by the recent downturn in the market. After years of strong, steady growth, the omega-3s sector saw its first actual decline, which has been attributed both to recent negative publicitiy and a possible maturation of the market, which could change its essential nature.
“We’ve had a lot of internal discussions. Should we be investing any money here now? I saw all the differentiation benefits this product provides and I said this product is simply undermarketed,” Bailey said.
A finished product manufacturer seeking entry into the omega-3 marketplace has no shortage of places to look for supply. The offerings range from commodity-priced 18/12 oils all the way up to ingredients at EPA/DHA concentrations that rival the pharmaceutical products. There are EPA- and DHA-only ingredients available, and algal and krill sources of omega-3s, too. What makes Stepan’s ingredient different?
According to Bailey, the difference in Stepan’s Marinol ingredient lies in its propriety extraction method. Many other extractors rip the EPA and DHA molecules off their original backbone in the fish oil and then offer them as ethyl esters or are put them back together into trigylcerides in a resterification process. Stepan’s technology takes a gentler, more direct approach, Bailey said.
“It really comes down to the process. Our process is a enzymatic process. We concentrate and purify the EPA and DHA without changing the original structure of the molecules,” Bailey said.
“If you look at the lipid structure of omega-3s in nature, 60% of them are in the Sn2 position,” Bailey said. “There are a lot of messages from nature that show that the positon of the fatty acid matters. We are the only concentrate that preserves that original Sn2 position.”
“(Other suppliers) are taking the molecule off the glycerine backbond and putting it back together in whatever way they do,” he said. “We are purifying the ingredient and maintaining that original position.”
Simplifying the message
According to Hiskias Keizer PhD, Stepan’s senior scientist, cites a 1995 study to show that uptake of essential fatty acids by the cells is improved when most of the molecules are in the Sn2 position on the glycerine backbone as opposed the Sn1 or Sn3 positions. Ingredients that have a preponderance of fatty acids in the sn-2 position also exhibit improved oxidative stability, he said. Keizer will offer a talk on the subject at the upcoming Ingredient Marketplace trade show in New York next week.
But lengthy discussions of chemical differentiation can make the eyes of even the most engaged customer glaze over, Bailey said. It could even lead to the suspicion that you are trying to hide something behind clouds of chemical obfuscation. Bailey said he saw the need to simplify and refine the message for an ingredient that up to now has been mostly used in the infant nutrition sphere in Europe.
“It’s not well known here and needed to be repackaged. The understanding of our product can be a little complex,” Bailey said. “We distilled it down to three buckets according to what is important to the consumer. Does it taste good? Does it deliver what I need in terms of EPA and DHA? And is it safe, with heavy metals and other contaminants removed?
“We are offering a product concentrated up to 40% to 50% depending on the product form. The process we use improves the the TOTOX values down the line so manufacturers are going to get better sensory performance. We are delivering an ingredient that goes beyond the levels that are asked for in the global monographs. And there are some efficacy benefits.
“This is not a commodity product. It is a unique process that we use. When you look at the whole value, line item by line item, then it becomes very easy to stubstantiate the value this product provides,” Bailey said.
Differentiation key for future
Stepan is offering several different forms of the ingredient, including a powder form and emulsions that can work in beverages. That diversity, and having a high quality base ingredient to start with, will be the key to future success in the market, Bailey said. He believes that as the market recovers from its recent downturn, it will exhibit a fundamentally different character, and old rules of how to compete will no longer apply.
“We know that people will not come back after a bad sensory experience,” Bailey said. “I don’t think people are going to be able to compete in the same way as they have, especially in the developed markets. I think it’s going to be about differentiation and uniqueness. That’s what this product delivers and that’s what we are going to talk about.”