Executive Interview: Q&A with Terry Lemerond, EuroPharma

Terry Lemerond is one of those industry legends who, while not as visible as some industry leaders, has had pivotal impact on our businesses and products. He founded and ran Enzymatic Therapy for many years, which became a standard bearer for quality and integrity in the supplements industry. Terry has a history of innovation driven by his extensive travels in Europe, where botanicals in particular have long been an accepted part of health care protocols.

NPI: You first entered the supplements industry as a retailer; did you intend to eventually become a manufacturer? How did that evolve? What kind of expectations did you have?

No, I did not intend to become a manufacturer, but being in the retail business for a number of years gave me a chance to listen to my customers’ requests, desires and complaints about the products that existed during that time. It was like having a focus group on a daily basis with a chance to ask questions and listen to your customers. Most of the customers wanted higher quality products that would assure them of providing benefits so they wouldn’t spend money without obtaining benefits. They also desired to take fewer products by having more ingredients in one product.

After listening to my customers, my desire was to increase and improve the quality of supplements, create formulations for specific indications which included a variety of nutrients that research showed would improve that condition. I wanted my customers to get results or their money back.

NPI: What was it that made Enzymatic Therapy become so successful?

The primary reason was innovation and creativity in the development of new ideas, concepts and product research. Enzymatic Therapy was the first to introduce glucosamine sulfate and IP-6 as well as create the category for menopause by the introduction of Remifemin. Enzymatic Therapy introduced botanical standardization and new herbs to the U.S. market that were not in the health food channel such as saw palmetto berry, ginkgo and milk thistle plus dozens of others that are now commonly sold. Enzymatic Therapy was also the first to offer a combination of nutrients called a ‘formulation’ for specific indications. All of these innovations have now become quite common concepts that are marketed by other companies.

NPI: With companies that are so strongly identified with a founder there is the issue of the company and that person’s identities being intertwined. It’s often been stated that entrepreneurs and visionaries are challenged to develop to the next level where the company stands independent from the women or man who began it. Some fail. What are the success factors to make the transition more likely? To what degree did this happen with Enzymatic Therapy?

When an entrepreneur sells a company, in my mind what probably would help the new owners succeed, would be to involve the past owner and founder for a specific period of time to learn what ideas and concepts were tried in the past, and were they successful, to listen to management and the employees for their input as to what was successful or not successful in past operational concepts, allow time for the customers to adjust to the change and still feel the past owner and management supports the new owners, and time for the new owners to gain the trust of the retail customers before the past owner moves on. This probably would be a period of 18-24 months. This did not happen with Enzymatic Therapy. It was their intention to involve me for 24 months, but it never happened. I can give you all kinds of ideas why I think it didn’t happen but they would all be assumptions. They did not think creatively how to best use my skills, contacts and relationships that I built over 22 years. Therefore, I think they lost some connection to the retail customer and the culture that was created by a family company that did things like offer massages. I was supposed to be a company ambassador. But the family oriented culture was not viewed by the new investors as economically sound. A lot of good people were lost because they were not appreciated for their efforts, contributions and knowledge.

NPI: Your bio says you introduced botanical standardization into the US supplements market. How did this come about? How has this changed the industry?

Prior to the introduction of standardization by Enzymatic Therapy in 1981, all herbal products sold in the US were just powdered plant parts without any regard to the length of time the plants were stored, where they were stored, how they were dried and proper identification of plants. Lab analysis was viewed as an unnecessary expense. To be quite frank, herbal products were very crude in relationship to what was being produced in Europe.

The European philosophy was, and still is, much more sophisticated and professional. In Europe, botanicals were considered medicines for minor, self limiting indications, and therefore, were treated as drugs and required much more detailed analysis. Therefore, strict regulation and registration was required to introduce an herbal product to the european market including proper identification of the herb, lab analysis and standardization of active principles. They were classified as drugs not because they were drug substances but because they were indicated for a specific illness or condition.

In the late 1970’s I discovered an old German drug manual that intrigued me and piqued my interest as to why this approach to quality wasn’t done in the U.S. So, after long discussions, and in some cases many months of negotiating, with european companies, Enzymatic Therapy introduced to the U.S. market some of the premier herbal ‘drugs’ sold in Europe.

In the U.S., Enzymatic Therapy sold them as a superior form of herbals. In this case each herbal capsule contained the same level of active materials versus who knows what would be in an herbal capsule produced in the U.S.

The way herbals are manufactured and sold in the U.S. has dramatically improved and they provide a tremendous amount of benefits in terms of support for a specific body structure or function. The quality assurance, lab analysis and plant identification have all helped to improve the professionalism of herbal products in the U.S.

NPI: What was your involvement in the introduction of glucosamine? How did you find it? To what do you attribute its popularity? Where does the category go from here?

Glucosamine sulfate, prior to the introduction to the U.S. market by Enzymatic Therapy in February 1993, was sold as a ‘drug,’ in several countries in Europe. A doctor at the University of Wisconsin, Madison called me and shared his work with glucosamine sulfate and hip dysplasia in dogs. The research was fascinating and pointed to a new way to help humans with joint dysfunction. Enzymatic Therapy was the first in the world to introduce it as a dietary supplement. Glucosamine sulfate was the first proven product that could provide benefit for people who complained of joint discomfort. Today, even physicians recommend it to their patients.

Glucosamine sulfate is a good product for joint health care but it has its limitations. Its primary function is to increase the quality of cartilage in the joint which seems to be successful in 40% of those who use the product. And, because of its function, it takes 8-12 weeks to see results. It’s mechanism of action is not as an anti-inflammatory. The next level of joint care to use alone or with glucosamine sulfate is a proven natural anti-inflammatory.

EuroPharma has obtained the rights to a fruit extract that is effective in 65-70% of the users and works as quickly as 2-3 weeks through an anti-inflammatory function. Since it’s a general anti-inflammatory it can be useful for a variety of indications such as gum, intestinal, cardiovascular and skin health. From the preliminary studies, the results are phenomenal. This does not mean that glucosamine sulfate does not have value but it has its limitations and works in a totally different manner. The ideal recommendation would be to use both the fruit extract and glucosamine sulfate.

NPI: What was your motivation to adopt GMP’s at Enzymatic Therapy in 1996? How unusual was this then? What was your biggest obstacle?

Our philosophy was that when you want to become the best you put standards in place way before anyone else adopts them. If we were to increase the level of professionalism for the health food industry, it would require putting GMP’s in place and lab analysis for the complete product line.

This was not a common practice because it entailed a large financial obligation. If all your competitors are not following the same concepts then eventually their products would be cheaper because they had not taken on the financial obligation to improve manufacturing quality. Most retail customers and consumers would not be knowledgeable of the fact that GMP’s put into place were causing your price to increase versus your competitor who is taking the easy way out. Our competitors just thought we were crazy, but retailers touring the company would talk about seeing other manufacturing facilities that were dirty and so messy you couldn’t walk though their facility with tripping over debris. They saw that at our plant you could eat off the floor.

If you don’t police the industry someone will do it for you.

NPI: You sold Enzymatic Therapy in 2000. Why?

A number of reasons: Bad advice; I was burned out; The price was quite generous. However, I sincerely regret having sold Enzymatic Therapy. It did make sense to some degree to prepare for my eventual exiting of the company and a way to give some of the company to my family who had helped Enzymatic Therapy become successful.

NPI: You founded EuroPharma in 2002 to find products in Europe and introduce them into the US, with notable successes such as the skin care product Renouvelle. Recently you announced a deal with Enzymatic Therapy to market and distribute several of your products. Can you share some of the rationale behind this arrangement? Tell us about your current focus.

The current focus of EuroPharma is to find new, innovative and exciting products to introduce to the market. My past history has been with a company that was very innovative and creative. We have a sense of doing this well and have made many contacts around the world that open up new doors for innovative products.

EuroPharma could build the infrastructure of a sales and marketing team or we could spend our resources researching and developing new products. We chose the latter and wish to partner with companies who have a sales and marketing force but don’t have the expertise EuroPharma has displayed for finding new products.

Two very successful products introduced by EuroPharma and which are now sold in many countries around the world were licensed to Enzymatic Therapy in 2005. Enzymatic Therapy is a solid company representing a high quality line of products that are manufactured and lab tested in a 175,000 sq. ft. state-of-the-art FDA registered facility. EuroPharma’s relationship with Enzymatic Therapy makes great sense since it’s a company I still have a lot of respect and admiration for. They are one of the leading quality companies in the industry. I’m proud that they represent EuroPharma’s products.

Moving forward, EuroPharma will soon introduce a fruit extract that is a highly researched anti- inflammatory supported by 13 clinical studies through several nutritional companies. Also available this summer will be the most potent and highly effective fat blocker with the ability to block more than 17 grams of fat per capsule. Another new product is a carb blocker that is 120 times stronger than what is currently on the market. Coming this fall will be one of the most potent anti- viral herbs yet to be released. Herbal products under development are: One to reduce PSA scores, one to increase muscle mass for body builders and the elderly, and an immune enhancer that is 100 times stronger than anything else on the market.

NPI: What is your assessment of the current state of the industry? What would you like to see change?

I don’t think our industry has policed itself successfully enough to gain increased confidence of the consumer. There’s a whole host of problems that exist with quality and regulation of the industry.

Many products still do not meet label claims. In some cases, herbs are not identified correctly in their selection and are not the right species, for example. A lot of companies try to do a great job but others take short cuts. They think a CA from the supplier is enough. They don’t check for identity. Rather than working together as an industry to reach a wider and broader base of customers, companies view each other as competitive enemies. Advertising is usually a bunch of hype and claims are made that are usually not substantiated. Certainly our industry lacks a degree in ethics.

While many companies are excellent and are trying to do everything to meet a high level of quality assurance, there still are a high percentage of companies dragging down those who are trying to increase the quality of life and serve the customers well. I would like to see some form of regulation and quality assurance guarantee for product introduction, a simple form of product registration to guarantee quality assurance and safety, and most importantly truth in advertising.

NPI: What do you like best about our industry? What do you like least?

I think our industry has a lot to offer in terms of serving the consumer if quality and integrity is built into the product. There are many products that can eliminate minor health concerns if we use them as our first line of defense, similar to OTC drugs. This is a great industry and we have a lot to offer the consumer who is looking for a safe, natural remedy with a reduced level of risks of side effects. However, this is dependent on the quality of the product.

Natural medicine in Europe and many other countries has reached a high level of acceptance and is supported by the respective governments. What I like least of this industry is when companies take the easy way out and lack the ethics to create scientifically based products. They try to catch sales on the shirttails of those who spend large sums of money to insure their product meets all specifications. Companies who use PR and advertising and spend large sums of money on GMP’s and lab analysis are leaving holes in the industry that get filled by those who jump on the band wagon with a “me too” product and don’t have to meet any regulatory specifications, such as the ones in Europe. A good company will always have higher standards.

NPI: If you could have done one thing differently over the years, what would it have been?

I would have concentrated and focused on a smaller line of products and spent more company resources on clinical research and scientific documentation. Eventually this industry has to emphasize more on the science side and less on the glorified hype. PR and marketing stories are great and the results are even far more excellent when they are used to support a science based product.

NPI: If we gave you a stage at a trade show, what would you want to say to the industry?

What we are selling is not pills, tablets & capsules. We are selling an outcome or result. We know we can’t make the claims to say that, but we are. People are coming to stores for a natural alternative to alleviate something that hurts. We have an obligation to those people to meet standards and promise them that if you use the products you will be able to alleviate the condition. They really want some kind of benefit, maybe to slow down aging process, or help with arthritis pain, or Irritable Bowel Syndrome. We promise in some fashion that if you buy our products we are going to do something for you. We should honor that promise. Some companies put products on the shelves that are junk.

Final GMP rules will help a lot of this, but it will still be hard to regulate. It will require scientific evidence, proper plant selection, lab analysis, but GMP’s are a major step in the right direction. Any good manufacturer will embrace this.

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