Lonza aligns structure, partners with DuPont on HMOs: Food-pharma convergence becomes central to new strategy

27 Feb 2019 --- Swiss multinational Lonza Specialty Ingredients (LSI) and DuPont Nutrition & Health have announced a joint agreement on Human Milk Oligosaccharides (HMOs), under which Lonza will manufacture and supply CARE4U 2’-FL HMOs. The news comes as Lonza unveils plans for an internal alignment of its business structure and scope designed to accelerate growth.

With an ever increasing world population there is likely to be an increased and growing demand for infant nutrition products, including HMOs for infant formula. Through the agreement with Lonza, DuPont Nutrition & Health will obtain a reliable supply chain to be able to provide functional human milk oligosaccharide 2-fucosyllactose (2’-FL) for these growing global markets.

“Partnering with DuPont, Lonza will apply its leading science and biotechnology expertise in consumer health and nutrition applications to develop and manufacture superior quality human milk oligosaccharide CARE4U 2’-FL,” says Erasmo Schutzer, President of Lonza’s Consumer Health Division.

“By engaging strategically with Lonza, DuPont will be able to accelerate commercialization and offer high-quality HMOs to customers and prospects. The collaboration with Lonza will play a key role in DuPont’s business growth strategy by focusing on providing high-quality consumer health and wellness products,” says John Rea, Global Business Unit Leader, Cultures, Probiotics, Food Protection, HMO & Fibers, DuPont Nutrition & Health.

Naturally present in human milk, HMOs have been shown to support digestive, immune and cognitive development in infants by modifying the gut microbiota. Infant formula attempts to mimic the nutritional composition of breast milk as closely as possible and clinical studies have shown that CARE4U 2’-FL can mimic some of the health-promoting effects of HMOs. CARE4U 2’-FL is produced by microbial fermentation and the final product contains more than 98 percent 2’-fucosyllactose, the most abundant of the more than 130 oligosaccharides in human milk. Superior powder properties (high purity and density) of CARE4U 2’-FL make it easy to use in infant formula and dietary supplements, note the companies.

Blurring boundaries: Food and pharma
The news comes as Lonza launches a new structure, which puts food-pharma convergence and developments in microbial control at the core of Lonza’s strategy. It is aimed as better position the company to create new solutions and develop offers across pharma, biotech and nutrition. 

“Our new structure will allow us to create more compelling offers, particularly with regards to nutrition, as it facilitates our ability to capture organizational synergies along the Healthcare Continuum and capitalizes on the growing trend of the convergence of food and pharma,” Lonza spokesperson Constance Ward tells NutritionInsight.

“The two sectors can no longer be viewed in isolation as consumers continue to be empowered to make better health choices and the healthcare sectors look to improve quality of life rather than just prolonging it,” Constance adds.

The boundaries between food and pharma are blurring.As part of the realignment, Lonza will maintain two segments spanning the Healthcare Continuum – one dedicated to LSI that will retain Consumer & Resources Protection and Consumer Product Ingredients and a second to Lonza Pharma Biotech & Nutrition (LPBN), combining Pharma & Biotech and Consumer Health & Nutrition.

With this move, Lonza says it is positioned to leverage its innovation programs and technology platforms to create new solutions. The segments will also focus on “operational excellence,” including an integrated global asset strategy that “enables a more-cohesive supply chain and asset utilization,” says the company. 

For the LSI segment, synergies across R&D and commercial functions will open up new market opportunities for the Microbial Control business and enable faster innovation. In the LPBN segment, translation of technology and know-how from pharma to nutrition, including regulatory and scientific expertise, will strengthen Lonza’s offering.

Lonza aligning its business structure comes at a time of blurring boundaries between food and pharma. Indeed, the topic has been under the spotlight recently through the Bill and Melinda Gates Foundation which is investing millions of dollars in new strategies to create consumable gut-microbe therapies that could be a game-changer in the probiotics space. It’s hoped that new complex and microbe-rich probiotics will help undernourished and obese children live healthier lives.

Consumers are also increasingly seeking to take control of their health through preventative means and this is having an impact on this playing field. Shifts in consumer understandings of health are impacting how they may approach nutrition, for example. 

Stefan Stoffel – who has been with Lonza since 1991 setting up a number of successful strategic projects, including Ibex – has been appointed to a new role on the Executive Committee as Chief Operating Officer, LPBN. He begins the role on March 1 and will cover operations, quality, engineering and strategic growth initiatives across the LPBN segment. 

“Our new structure will nurture synergies and increase operational efficiency, which will create customer benefits. More importantly, it will enable Lonza to develop a more compelling offer across pharma, biotech and nutrition and to extend our competitive advantage in the market,” says incoming CEO Marc Funk. 

“Stefan is a well-regarded, long-established and a strong leader in the Lonza business. His oversight of LPBN segment operations will help us to galvanize our offering and capitalize on future opportunities.”

Stoffel will join Funk, Sven Abend (COO LSI) and Rodolfo Savitzky (CFO) on the Executive Committee. The commercial functions of the new LPBN segment will be driven by Funk for the time being, says Lonza. 

All future financial reporting will be based on the two new segments.

From speciality ingredients such as HMOs, to advanced personalized medicines, to functional foods, nutrition and a healthy environment, the new strategy will enable Lonza to will focus on driving differentiated offerings to support healthy living and keep pace with consumer demands.

NutritionInsight has reached out to Lonza for more details. 

By Gaynor Selby