Japanese market profits BioGaia

Related tags Lactobacillus reuteri Lactobacillus

Swedish probiotics developer BioGaia, made significant progress
towards profitability in the past year thanks to a take-off in
higher margin sales in Japan.

BioGaia's products are based on the lactic acid bacterium, Lactobacillus reuteri​. The value-added end of the business lies in novel delivery systems based around tablets, capsules and even straws.

The shift to higher margin business lifted gross profit by 81 per cent on sales growth of 64 per cent, to €3.9 million on the continuing business, excluding the fermentation business sold off in 2002.

Meanwhile overheads on the continuing business grew by just 8.1 per cent.However the relative cost reduction was insufficient to deliver the company into profit.

Operating losses amounted to SK 27.1 million, compared with SK 34.3 million the previous year.

With six contracts pending product launches BioGaia expects a significant increase in sales revenue for 2004.

"The reuteri tablet success in the Japanese market has been clearly reflected in BioGaia's annual sales results. We hope to continue moving further into the Far East after signing another licensing agreement for Taiwan and China,"​ said deputy managing director of BioGaia Jan Annwall.

Earlier this month BioGaia signed an agreement with German baby food manufacturer Hipp & Co to distribute Reuteri-fortified baby food in Europe.

BioGaia sells both license rights for the use of Reuteri in customers' own products and finished products such as Reuteri mixtures, Reuteri tablets and LifeTop Straw.

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