As regulatory requirements for foods and health products tighten across the world and product categories become increasingly competitive, more companies than ever are investing in research and development (R&D) to help their products stay novel, comply with regulations and stand out in the marketplace. Product-specific data is the common and trending theme that meets these objectives. In order to generate this data successfully and within budget, companies must ensure they are maximizing their return on investment (ROI) as it relates to product sales and marketing. This lecture will provide you with valuable information about the value of product-specific data for marketing and sales, and discuss specific strategies your company can use to maximize your return on this investment.

1. Nutrasource Diagnostics Inc.
The Value of Product-Specific Data for Sales
and Marketing Return on Investment
Friday, March 7th, 2014
William Rowe, BA
President & CEO
wrowe@nutrasource.ca
www.nutrasource.ca

2. Outline
• About Nutrasource and our product commercialization
platform
• Product claims and product-specific data
• 3 unique case studies: food, raw material ingredient,
dietary supplement
• 4 stages of development:
–
–
–
–
Systematic scientific literature reviews
Product analytics
Human clinical trials
Health/product/marketing claims
• Return on investment
• Additional Nutrasource information
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

3. About Nutrasource and Our Product
Commercialization Platform
www.nutrasource.ca
Booth # 176

4. About Nutrasource
• Nutrasource Diagnostics Inc. (NDI) is a full
service R&D department for the consumer
health products industry from ‘farm’ to
‘pharm.’
• Delivering commercialization
since 2002
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

5. Product Development:
2 Key Scenarios
1. Launching a new product
2. Re-launching/re-positioning an existing
product
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

6. Answering the 5 Key Questions
To help determine your product’s sales, marketing,
regulatory and R&D strategy, we ask the 5 key
questions:
1. Where is it made?
2. How is it made?
3. What is it?
4. What would you like to say and what can you
say about it?
5. What country would you like to sell it in?
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

7. From Concept to Claim/Market
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

8. Start with the End in Mind
Reverse the concept to claim pathway with the
product claims as your starting point to ensure
all research, development, regulatory,
intellectual property and marketing are
positioned with this common thread
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

9. Product Claims and
Product-Specific Data
www.nutrasource.ca
Booth # 176

10. Product Claim: Part 1
Remember – your product claim (health claim,
nutrient content claim, structure-function claim)
drives your marketing, your collateral, and your
intellectual property
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

11. Product Claim: Part 2
Remember – your product claim is the intersect
point where science, legal and marketing
converge and this is
where ROI on new
product launches and
product re-positioning
occurs
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

12. Product Claim: Part 3
Remember – it is time to stop thinking about
these aspects of product development as
individual silos of activity but as one continuous
commercialization strategy
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

13. Product-Specific Data
Product-specific data is data
that provides unique and novel
marketing, sales and regulatory
information and positioning
specific to your product’s
formula, its characterization,
its attributes, and its implied
or direct health benefits
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

14. Why is it important?
• Strengthen company name and product brand
• Establish integrity and credibility
• Create research rights and intellectual
property
• Product claims substantiation
• Increase sales exponentially
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

15. General Observations
• Companies are providing very similar marketing
messages within categories
• Companies do not see the ROI on clinical trials or
similar larger budget research and development
• Companies see the FDA, EFSA and Health Canada
as an adversary instead of an ally
• Companies fight the tightening of the regulatory
environment instead of using it for marketing
leverage
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

16. 3 Unique Case Studies:
> Food
> Raw material ingredient
> Dietary supplement
www.nutrasource.ca
Booth # 176

17. Case 1: Seafood Situation
• Company provided fresh seafood meals to the
cruise line industry
• A rogue employee set up down the street
began taking market share up to ~30%
• Regular marketing using terms
like “fresh,” “natural,” “delicious”
• Traditional marketing was not working
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

18. Case 1: Product-Specific Data
Difference
• Stability testing to demonstrate novel production
process gave an additional 3 days shelf life over
competitor
• Regulatory and nutritional analysis assessment to
provide insight to more aggressive claims around
EPA and DHA levels in seafood dishes
• Define reported adverse events profile from FDA
in the public record to show low frequency of
issues and strong lack of illness track record (over
1 billion meals served and only 10 reported
events to the FDA)
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

19. Case 1: The Result
• Rogue competitor shutdown in 3 months
• Company returned to industry leading status
in category
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

20. Case 2: Moving Right Along
• Company with an insoluble oat hull fibre wanting
novel fibre claim applicable across multiple food
categories for the US and Canada
• Precedent had not been
set for one submission
covering this many
applications in various
cereals, breads and pastas
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

21. Case 2: Product-Specific Data
Difference
• Create systematic literature review on
scientific rationale for metabolic controlled
diets
• Design a ‘free range human’ study with
assessment of 9 product arms following
subjects for 5 months
• Use Radio Opaque rings to track stool volume
and transit time
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

22. Case 2: The Result
• Most widely applicable novel fibre claim ever
approved in North America
• Company can transfer related claims up to the
end user on the supply chain for food and
dietary supplement applications
• IP around process technology allows company
to retain IP and tie claim back into IP
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

23. Case 3: Breast is Best
• Company required an implied breast cancer
prevention claim
• Breast Cancer claims in Canada are a Schedule
A disease claim typically
reserved for large scale
pharmaceutical
development
• What to do next?
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

24. Case 3: Product-Specific Data
Difference
• Systematic literature review to confirm
theoretical formula optimization and biomarker
identification based on published literature
• Health Claim strategy around brand name and
actual claims relating to estrogen metabolite
levels and ratios
• Clinical trial in pre and post menopausal women
specific to health claim strategy and regulatory
filing
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

25. Case 3: The Result
• The only Natural Health Product ever licensed
in Canada with implied breast cancer
prevention health claims
• A publication in an oncology journal
• ‘Immeasurable ROI’ according to the client
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

26. 4 Stages of Product Development:
> Systematic Scientific Literature Reviews
> Product Analytics
> Clinical Trials
> Health & Marketing Claims
www.nutrasource.ca
Booth # 176

27. Strategies and Tactics: Systematic
Scientific Literature Reviews
• Assessment biomarkers of interest for your
formula and claims
• Theoretical formula optimization from a
claims perspective
• Jurisdictional assessments of level of
aggressiveness around the claim
• Assessing the research gap of where you are
vs. where you need to be for claims
substantiation
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

28. Strategies and Tactics: Product
Analytics
•
•
•
•
Contamination assessments
Stability assessments
Active ID and Concentration
Characterization of
formula and unique
attributes
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

29. Strategies and Tactics: Human Clinical
Trials
•
•
•
•
•
Efficacy assessments
Safety assessments
Publication strategy
Biomarker strategy
Study design to answer
as much as possible!!!
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

30. Strategies and Tactics:
Health/Marketing Claims
•
•
•
•
•
Marketing collateral
IP strategy
Certification strategy
Government approval/compliance strategy
Label messaging strategy
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

31. Return on Investment
www.nutrasource.ca
Booth # 176

32. Strategies and Tactics: ROI for New
Product with Clinical Trial
Dietary Supplement - Enhanced Competitive Positioning
The Scenario
$500
$150,000
New Positioning Revenue
$350,000
Baseline Revenue Growth
5.5%
Revenue Growth Increase
0.0%
Change in Profitability
0.0%
$300
Discount Rate
Net Present Value
Internal Rate of Return
Payback
10%
$54,939
45%
3.0 years
Current
Positioning
$200
$100
$0
Year 0
$35,000
The Business Case
New
Positioning
$400
Investments in
$K
Investments
Net Profit and
Revenue $K
Baseline Revenue
Year 1
$30
$20
Phase IIa Study
$10
Phase I Study
$0
Sources: Frost & Sullivan (2005); NHP Insider (March 2012)
www.ifosprogram.com
www.nutrasource.ca
Year 2
Booth # 176
Year 3
Year 4
Year 5

33. Strategies and Tactics: ROI for New
Product with Clinical Trial
• Such an investment would yield a 45% return
and a 3 year payback generating a Net
Present Value (NPV) of $54,939
• The NPV is a measure of how much profit the
investment produces in today’s dollars and is
determined by adding the discounted cash
flows of the project over its lifetime
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

34. Strategies and Tactics: ROI for Existing
Product with Clinical Trial
Nutraceutical (OTC) Supplement - Enhanced Competitive Positioning
The Scenario
$4.0
$1,000,000
New Positioning Revenue
$3,000,000
Baseline Revenue Growth
13.8%
Revenue Growth Increase
0.0%
Change in Profitability
0.0%
$2.0
$1.0
Year 0
$400,000
The Business Case
Discount Rate
Net Present Value
Internal Rate of Return
Payback
10%
$511,387
32%
5.8 years
New
Positioning
Current
Positioning
$3.0
$0.0
Investments in
$K
Investments
Net Profit and
Revenue $M
Baseline Revenue
Year 1
$300
$200
Phase IV
$100
Phase III
$0
Sources: Frost & Sullivan (2005); NHP Insider (March 2012)
www.ifosprogram.com
www.nutrasource.ca
Booth # 176
Year 2
Year 3
Year 4
Year 5

35. Strategies and Tactics: ROI for Existing
Product with Clinical Trial
• Such an investment would yield a 32% return
and a 5.8 year payback generating a Net
Present Value (NPV) of $511,387
• The NPV is a measure of how much profit the
investment produces in today’s dollars and is
determined by adding the discounted cash
flows of the project over its lifetime
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

36. Additional Information About
Nutrasource and Our Services
www.nutrasource.ca
Booth # 176

37. Our Memberships & Affiliations
NDI is a proud and active member of:
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

38. Our Testing & Certification Programs
• Nutrasource is also the developer and
exclusive provider of testing and
certification program for:
• Fish oils – International Fish Oil
Standards Program (IFOS™)
“
IFOS played a significant role in Renew Life’s
ability to grow in the omega-3 category in 2013
despite the category’s decline of approximately
10%. – Peter Agostino, Renew Life
”
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

39. Our Testing & Certification Programs
• Nutrasource is also the developer and
exclusive provider of testing and
certification program for:
• Krill oils – International Krill Oil
Standards Program (IKOS™)
• Sports & fitness supplements –
International Fitness Ingredient
Testing Program (IFIT™)
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

40. Diteba: Analytical and Bioanalytical
Laboratory
• Testing performed in accordance with the U.S.
FDA 21CFR Part 210 & 211, Health Canada
GMP guidelines and ICH guidelines
• Licensed by Health Canada as a GMP drug
establishment (#102117-A) and registered as a
Drug Establishment with the FDA and licensed
by Health Canada to handle controlled drugs
and substances.
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

41. Have a product you’d like to
launch or re-launch? We can help!
Stop by the Nutrasource booth #176
for a one-on-one consultation with
myself or a member of my team to
discuss your product R&D and
marketing strategy.
www.ifosprogram.com
www.nutrasource.ca
Booth # 176

42. Thank you!
William Rowe, BA
President & CEO
wrowe@nutrasource.ca
Connect with Nutrasource:
www.nutrasource.ca
facebook.com/nutrasourcediagnostics
@Nutrasource_NDI
linkedin.com/company/nutrasource-diagnostics-inc.
© Nutrasource Diagnostics Inc.
www.ifosprogram.com
www.nutrasource.ca
Booth # 176