Beyond Benecol: Raisio diversifies in health arena

By Jess Halliday

- Last updated on GMT

Related tags Raisio Soybean

Ten years after Benecol first launched in Finland, Raisio is
developing new ingredients and consumer products that will extend
its dominion in the functional and health foods market.

Over the past decade, the Finnish company has built up the cholesterol-lowering Benecol brand from scratch. Now with 14 licensees and products sold in some 30 countries, it reported Benecol-ingredient turnover of €44.7 million in 2004 and has seen about 20 percent growth this year.

Raisio now considers that the time is ripe to reach out to other areas of the functional foods market. It is working with ingredients like omega-3 and healthy bacteria, and developing healthy soy- and oat-based foods under its GoGreen product line.

Last Spring, Raisio sold off its Chemicals division to Ciba Specialty Chemicals for €475 million - a decision which Taru Narvanmaa, Raisio's executive vice president for communications and IR told made the its balance sheet stronger and allowed it to invest in research and development.

Its R&D forces were united into one entity, which serves both its business areas, Raisio Life Sciences and Raisio Nutrition. While the former is concerned with ingredients and diagnostics and accounts for 15 percent of the company's €450 million turnover, the latter delivers the remaining 85 percent by supplying food (including the Benecol brand), feed and malt to the Finnish market and the Baltic Sea area.

Although Benecol is now a well-established brand, clinical studies are ongoing. In addition, the company is investigating imbuing the products with added function - healthy bacteria being one of the options, either in combination with plant stanols or for use in separate end products.

However Narvanamaa said that combining two functional ingredients in one product could present some drawbacks. "Pricing might be a problem, as two ingredients might be too expensive,"​ she said.

Another new direction for ingredients is omega-3. The company plans to add alpha-linolenic acid (ALA) derived from a plant called Camelina sative​ to its existing margarine brands in Finland, Russia and Poland. it is already used in its Beneviva margarine for heart health, and is found in salad dressings offered by Finnish brand Kesko.

Camelina sative​ was farmed in the middle ages, but it was largely forgotten as a crop until recently, when new studies showed it to have a good combination of omega-3 and omega-6, compared to other plant sources.

After having bought a small development company, Raisio's first farming contract this year yielded a crop of 2,000 hectares.

Vice president R&D Annika Mäyrä-Mäkinen explained to that in addition to its omega3:omega 6 ration, Camelina sative​ was chosen as the ALA source above flax since it was deemed less susceptible to oxidisation and to have a better taste.

"In the future, we want more farmers to take it into production,"​ said Narvanamaa. Once this happens, the company may look at offering it as an ingredient as well as in finished consumer products.

In March, Raisio formed a joint venture with Cerealia called GoGreen, under which it plans to introduce healthy soy- and oat-based consumer products initially to the Finnish market.

It has invested €5 million in a new factory in the Finnish town of Turku and is expected to begin producing drinks, yoghurts and desserts at the beginning of 2006.

Raisio already uses soy as an ingredient, but the initiative marks its first own-produced consumer soy products. Previously it has marketed a line of soy and oat-based drinks in Finland under the Beneviva range made by an outside manufacturer.

The largest soy product producer in Finland is Alpro, and oat-based products are also on the market through a competitor called Oatly.

Although it is too early to give any indication of target market share, Narvanmaa said Raisio will be seeking to differentiate itself from these established competitors with some innovative products and an emphasis on convenience and on packaging technology.

At a later stage, it may also consider adding plant stanols to the formulations, at which time it will become branded as Benecol. For now, they are considered to be healthy - rather than truly functional - foods.

"We can say that they are good for health, but not that they are providing something extra,"​ said Narvanamaa.

As for plant stanols, the company is increasing the capacity of its stanol ester plant in Raisio, the small Finnish town after which the company is named. This has been necessitated by demand in Europe; recently, it has been shipping ingredients from its facility in Charleston, USA, where capacity has been under utilized as the brand has not performed so well on that side of the Atlantic. This arrangement is expensive, however, prompting a solution to be found on home soil.

Presently, Benecol is showing more promise in the Latin American market than in North America, where McNeil is the license-holder. It is also making in-roads into the Asian market.

"Asians are starting to eat more Western foods, and their heart health has been worsening,"​ said Narvanmaa. "There has been a dramatic change, particularly for young people living in cities."

Traditional Asian diets are rich in soy, fish and grains, which are understood to have heart protective benefits.

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