By the time he co-founded Orlando, Florida-based Xymogen Inc. in 2003, Brian Blackburn had already spent 20 years working in the nutrition sciences business, including a stint as president of a successful supplement distributorship for a leading supplement company that sells solely via healthcare practitioners. Blackburn jumped ship because he saw an opportunity to create a practitioner supplement company that improved upon those that came before it and helped solve some key problems associated with practitioner supplement sales, such as Internet competition and the peddling of overpriced formulas with less-than-efficacious ingredient amounts. The goal was to “build a better boat,” said Xymogen President and Co-Founder Will McCamy.
Xymogen currently offers a line of more than 100 different dietary supplement formulas in a full range of wellness categories, including adrenal/thyroid and gastrointestinal support and general men's and women's health. Twenty eight sales representatives sell Xymogen's products directly to medical doctors and other practitioners. Xymogen currently reaches about 35%-40% of the United States, though the company's coverage is on track to expand given the impressive growth it has experienced over the last few years.
In 2009, Xymogen's sales totaled about $26 million, growing 25% over 2008's revenue, according to Nutrition Business Journal estimates. The company told NBJ that sales in March of this year leapt a full 40% over sales from March 2009. In total, Xymogen has seen 24 consecutive quarters of sustained growth since its launch in October 2003. This success, said Blackburn and McCamy, stems from the quality and efficaciousness of Xymogen's products; the close ties it keeps with customers; and the growing interest among practitioners and patients alike in using nutritional supplements to support general health and disease prevention.
Noticing what was broken in both the mainstream healthcare system and the dietary supplement industry, Blackburn and McCamy set out to revamp the latter in order to improve the former by providing practitioners with superior supplement products and the knowledge of how to integrate them into a holistic wellness model.
Although practitioners such as chiropractors, acupuncturists and traditional Chinese medicine specialists have typically been the ones to integrate supplements into their practices, medical doctors are increasingly embracing nutritional therapy. In fact, MDs generate the majority of Xymogen's sales and are the focus of the company's outreach and sales efforts. “Medical doctors form the biggest part of our revenues, especially when it comes to anti-aging,” Blackburn noted. “But we work with everyone: dentists, chiropractors, veterinarians — any physician who uses functional medicine.”
The Rolex of Supplements
Xymogen's first step in revolutionizing clinical nutrition was to build a range of supplements that provide the most efficacious dosages possible. “We felt we could vastly improve all the formulas if we could put an end to window dressing — that is, loading formulas with all these costly ingredients in order to raise the price of the product, but not enough to make it efficacious,” explained Blackburn, Xymogen's CEO. “So our first commitment was to evidence-based dosage for all of our formulas.”
Along with focusing on quality and efficacy, Blackburn and McCamy wanted to set Xymogen apart from other practitioner supplement companies by prohibiting all Internet sales of its products and, thus, giving its practitioner customers exclusive access to the Xymogen brand. “When we started Xymogen, we felt this obligation to retain our products' exclusivity in the practitioner channel and to remain dedicated to preventing Internet sales,” Blackburn said. To follow up on this ideology, Xymogen set precedent by being the first nutraceutical manufacturer to make customers sign a legally binding form forbidding them from selling or even mentioning the prices of the company's products on the Web. Remaining “anti-Internet” has been “a huge, Herculean undertaking,” said McCamy, and one that hasn't been without its temptations. Recently, for example, Xymogen was forced to reject a $100,000 bid from an online retailer interested in selling the company's products.
But for Xymogen, exclusivity doesn't just function as a complement to some mystique of inimitable quality (“You can't buy a Rolex online; you can't buy Xymogen's products online,” Blackburn said). The concept also represents Xymogen's dedication to its customers, as well as the company's understanding of the value doctors and other healthcare practitioners provide their patients. “[Consumers] can go to mass market retail and MLMs, but people always go back to their practitioners,” McCamy said. “Your practitioner can give you what the floorwalker in a muumuu and Birkenstocks at your local health food chain can't.”
Clinically Applicable Education
In turn, Xymogen tries to offer practitioners something they can't get from many other supplement manufacturers: real knowledge about how to most effectively use nutritional supplements. Since its inception, Xymogen has been active in practitioner education, hosting weekend seminars, Webinars and other events that place a distinct emphasis on the applications for its products. “We focus on presenting compelling and cutting-edge science, but we also want to make it relatable to practitioners' everyday lives,” McCamy said.
Prior to founding Xymogen, McCamy and Blackburn noticed that oftentimes practitioners felt overwhelmed by the research presented in seminars and would spend a week sitting in their offices trying to digest a glut of science. Providing too much science in functional medicine may seem oxymoronic — especially given that practitioners are usually the ones to roar the loudest over extravagant claims and a pervasive lack of science in the supplement industry — but practitioners, McCamy noted, require “scientifically germane” information that is also clinically applicable. “We want, in a weekend, to teach practitioners something they can bring into the office on Monday,” McCamy added.
Xymogen's education programs also allow the company to form closer relationships with practitioners. “In these weekend seminars, you spend eight hours a day getting to know these practitioners,” said Blackburn, who himself has developed and presented functional medicine continuing education programs for 15 years.
Robert Rountree, Xymogen's medical director and chairman of the company's board of advisors, also engages in practitioner education. Like many on Xymogen's board of advisors, Rountree is certified in holistic medicine and, because he still practices two days a week, is able to bring to the company's training relevant and current knowledge of what it takes to successfully incorporate dietary supplements into a physician's practice.
Partners in Innovation
Xymogen's eagerness to provide practitioner exclusivity and evidence-based dosing make it an attractive partner for innovative ingredient suppliers and research firms, such as Proliant Biologicals. The biotech firm's ground-breaking immune-boosting ingredient ImmunoLin is now used in several Xymogen products. “ImmunoLin is the world's first GRAS-certified immunoglobulin concentrate ingredient available for the dietary supplement market,” said Eric M. Weaver, PhD, Proliant's chief scientific officer.
Weaver said Proliant partnered with Xymogen because the ImmunoLin ingredient gels well with the practitioner supplement company's business model. “For most of our products, we tend to accommodate companies operating in any sales channel. But ImmunoLin is definitely more of an exclusive product,” Weaver said. The ingredient supports immune response and gut health and has demonstrated positive results for a variety of health issues, ranging from allergies to cardiovascular disease to diabetes. ImmunoLin is featured in some of Xymogen's most successful supplements, including immune supporter IgG 2000 DF, a dairy-free, immunoglobulin concentrate product that is included in about seven different SKUs for the company.
“This partnership [between Proliant and Xymogen] has been really good for both of us,” said Weaver. “They give their customers proprietary access to our ingredient, and they're really focused on exclusivity, so it's almost ideal. And we were really looking for a company dedicated to efficacious dosing. The minimum dosage for ImmunoLin in immune boosters is five grams per day, and Xymogen was the very first company to guarantee that.”
Xymogen's commitment to cutting-edge research allows it to be very selective as it considers a multitude of partnership offers from research firms and biotechs. Proposals are put before Xymogen's board of advisors, a panel of 22 clinical practitioners hailing from a wide variety of disciplines, and are evaluated for their potential for clinical efficacy, as well as for generating sales. “We won't shy away from telling researchers what will produce revenue,” McCamy said.
Xymogen is currently engaged in several research ventures, including studies in bone mineral density, COPD (chronic obstructive pulmonary disease) and supplement programs for chronic AIDS patients. Xymogen has also worked extensively with Johns Hopkins University on investigation into sulforophanes, compounds with antioxidant and detoxifying properties that may be useful in cancer protection. The compounds, derived from broccoli seed extract, are employed in Xymogen's OncoPLEX and OncoPLEX ES formulas, which provide antioxidant and detox support for patients undergoing clinical chemotherapy. Xymogen's catalog also includes the gastrointestinal supplement Lacidofil, a probiotic blend developed by Institut Rosell, a leading researcher and manufacturer of probiotics.
On the horizon is a significant partnership with leading neurologist David Perlmutter, MD, and his company iNutritionals, which markets supplements geared toward brain health. Xymogen plans to work with iNutritionals to develop a line of neurological nutrition supplements targeted toward mood, mind and memory disorders. “The partnership offers us significant growth opportunities and will help to build the credibility of Xymogen,” said Blackburn, “David [Perlmutter] is the most well-published, well-respected doctor in the field of neurological nutrition.”
Also forthcoming is a line of water-soluble food powders that contain Xymogen's proprietary VegaPro ingredient, a rice/pea protein combination that functions as a non-dairy, vegan counterpart to whey protein. Food powders had been part of Xymogen's initial agenda when it started in 2003, but, until now, flavor had always been an obstacle. VegaPro contains fructose, but in combination with stevia, so it keeps a low glycemic index, has a neutral taste and, all in all, adds up to what Will McCamy likes to call the “Obi Wan Kenobi of flavor proteins.” VegaPro is currently included in Xymogen's FIT Food Lite Vegan food powders and its i5 gastrointestinal health powder combination, which is on pace to be the manufacturer's best-selling product of 2010.