Earlier this month, Nestlé--the world’s largest food and beverage corporation—announced that it was acquiring Atrium Innovations, a Canadian company that holds several of the top practitioner-focused nutraceutical brands—for $2.3 billion in cash.
Atrium’s portfolio includes Pure Encapsulations (ranked in Holistic Primary Care’s annual practitioner surveys as the most commonly dispensed professional brand), Douglas Laboratories, Seroyal, Sedona Labs, Wobenzym, and several other well-known companies within the holistic and functional medicine space.
Atrium also owns Garden of Life, one of the most popular direct-to-consumer retail brands in the natural products industry.
Right about the same time, Mitsui—one of Japan’s biggest keiretsu (an integrated grouping of enterprises)-- and one of the world’s largest corporations--announced a strategic investment in Thorne Research, another key player in the US professional channel.
Both deals have potential to vastly expand the reach—both in the US, and globally—of top quality supplements and nutritional products, and to bring them into markets previously inaccessible to smaller companies.
Nestlé Health Science already has a strong portfolio of specialty nutrition products that includes PamLab, a medical foods company that makes specialized methylfolate products to treat depression, diabetes, and memory loss,
The global food and beverage titan will likely be able to bring Atrium’s practitioner-grade nutraceuticals into mainstream healthcare channels inaccessible to smaller brands. It is already channeling products into 4,500 US hospitals and clinics.
On its own, Pure Encapsulations had already made major inroads into more mainstream clinical settings, particularly at the Cleveland Clinic. Similarly, Thorne Research has developed an exclusive research collaboration with the Mayo Clinic.
The backing of two of the world’s biggest corporations could provide the credibility needed to open minds—and doors—at other mainstream medical centers that have previously been averse to supplements, even the top-tier practitioner-only brands.
Many industry-watchers are calling the Nestlé-Atrium deal a watershed moment in the evolution of the natural products industry, one that indicates the degree to which the worlds biggest businesses are recognizing the importance of good nutrition, and the public’s demand for it.
Brands like Thorne, Pure Encapsulations, and Douglas Labs have deep legacies within the communities of holistic, naturopathic and functional medicine practitioners. These relationships are built on trust, service, and commitment to product efficacy, safety, and quality.
Some clinicians who’ve been long-time customers of these companies worry that the fiscal imperatives of multinational corporations will distort the values on which these brands were originally founded.
Nestlé, known primarily as a candy producer, also has a questionable track record on environmental issues. The company has been aggressive in the US and worldwide in acquiring aquifers to supply its for-profit bottled water business, which is one of the world’s largest. It has also been cited in allegations of child labor exploitation in its cocoa harvesting operations.
In blogs and Facebook posts, a number of practitioners who currently dispense Atrium’s pro-only brands have voiced discontent about the merger, and have vowed to switch to other professional-only brands that remain independent or at least unaffiliated with massive multinational corporations.
For it’s part, Nestle has signaled that it intends to sell off its venerable candy assets, and commit more of its resources and intelligence to health-focused, eco-friendly businesses.
It remains to be seen whether the company will follow through on that vision.
One thing is clear: dietary supplements—including those in the practitioner-only channel—are very much on the table in the world’s largest corporate boardrooms.