Nestle to expand medical food arm
Published 28/09/2010 | 05:00
NESTLE, famous for products such as Kit Kat, Aero and Yorkie, revealed yesterday that it is to promote low-protein chocolate bars and non-fattening soups.
The move came as the Swiss food group announced a significant expansion of its medical nutrition activities. It is to pump hundreds of millions of dollars into Nestle Health Science, a subsidiary to be launched next year.
The idea is to boost sales in the growing market for foods designed to treat illnesses ranging from diabetes to Alzheimer's.
The company will set up an institute of health sciences in Switzerland to oversee research and development into a sector tipped to produce high profits and a better corporate image.
Analysts said Nestle's announcement could presage a move for Abbott Laboratories, the American healthcare group that makes products such as Juven, a powder supposed to accelerate the healing of wounds.
Peter Brabeck, Nestle's chairman, said that the group was seeking to "pioneer a new industry between food and pharma".
The new division will incorporate Nestle's health nutrition business, which had sales of SFr1.6bn (€1.15bn) last year and makes products such as Optifast Chicken and Tomato meal substitute soup, and low-cholesterol Carnation Instant Breakfast Essentials.
The division will also include Vitaflo, the British company acquired this summer, which makes foods for people suffering from metabolic disorders.
Mr Brabeck set out to paint Nestle's initiative as a form of global public health programme that will alleviate the burden on welfare systems.
"Personalised health science nutrition is about finding efficient and cost-effective ways to prevent and treat diseases in the 21st century," he said.
However, Paul Bulcke, the group's chief executive, described the venture in more down-to-earth terms as a "promising business opportunity". He added that Nestle Health Science would be looking for acquisition and licensing opportunities.