Primex expands chitosan business, US presence

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Primex, the Iceland-based marine biotech company, has strengthened
its position as the world's leading producer of chitosan products
through the acquisition of the bulk chitosan business of Vanson
HaloSource - a move which also gives it the market leading LipoSan
brand in the US.

Primex produces chitosan and other chitin-derived products from the shells of North Atlantic shrimp, and has co-operated with VH in the US market since 1998, selling its chitosan ingredients to the US company.

But now the European group will take control of all of VH's bulk chitosan operations, including inventory, patents, trademarks, product and application technology and distribution channels, as well as the LipoSan Ultra range of dietary supplement ingredients. The price paid for the business was not disclosed.

Bjarte Langhelle, marketing director of Primex, told​ that the company had big plans for the US market. "We are the world's biggest supplier of chitosan products, with a market share in Europe and in Asia of around 50 per cent. We are targeting the same kind of share in the US market as well."

Langhelle explained that the US market was highly competitive, charcterised by a large number of low-cost (and, he claimed, much lower quality) Chinese chitosan ingredients. "The way in which we can compete with these low-cost providers is on quality,"​ he said.

"The patented production process for our chitosan products enables us to ensure that they are of a much higher quality than rivals. LipoSan Ultra, for example, is optimized for lipid binding - it has been widely documented as being highly effective as a weight loss product. It is also very quickly soluble, which means it can be taken with a meal."

Inghalle however declined to comment on how exactly Primex processes its chitosan to ensure this quality advantage.

He said that another major plus for LipoSan was that it had been around for a long time. "Lots of weight loss products are 'fashion-driven',"​ he said. "They last between two and three years and then disappear, to be replaced by the next fad. But chitosan has been recognised as an effective weight loss product for more than 10 years now, and has been proven to be a product which really works."

This consistency has helped LipoSan maintain its sales and market share even in the light of the Atkins diet fad, he said, although he declined to give precise figures. He said that consumers knew the LipoSan name - dietary supplements containing the ingredient always carried its branding, he explained - and that they trusted it to work, a significant advantage for the brand in a competitive market.

Under the terms of the deal with VH, the LipoSan Ultra brand will continue to be marketed by a third-party company, Wilke Resources.

VH, in turn, will focus on higher added-value products, rather than the bulk chitosan market, in particular its Sea-Klear pool and spa care products, Storm-Klear stormwater treatment products, and wound- and burn-healing applications for the biomedical market. The HaloShield and HaloPure technologies for healthcare, food service, water purification markets, and HaloFresh Coolant Xtender for the manufacturing industry will also remain part of the US group's activities.

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