Supply chain integrity joins science on the marquee for branded ingredientsSupply chain integrity joins science on the marquee for branded ingredients

“Science-supported.”

“Evidence backed.”

“Clinical studies.”

This is the language of branded ingredients. Typically designed to be more concentrated, more bioavailable and generally more effective—with claims to match—branded ingredients are stories of science.

That could be changing. With more attention being placed on transparency, traceability and ingredient identity, the question of “What does it do?” hasn’t gone away. It’s just been joined by “Where does it come from?”

“Of course the science along with the quality and consistency of the ingredient go hand in hand with sourcing, but now the supply chain is becoming more and more critical,” says Loretta Zapp, CEO at Applied Food Sciences, makers of Kavoa and PurCaf.

“There’s more concern and more questions about quality, not about the brand, but about the quality,” says Bob Capelli, vice president for global marketing at Algae Health Sciences
Questions about the supply chain don’t end at quality or test results either, Zapp says. “Many brand companies are looking for specific information on where the ingredient material comes from and how it’s processed as opposed to just seeking a certificate.” Such questions can extend all the way into the marketing, Zapp says.

“Brand companies recognize that many of their customers desire products that are both ethical and sustainably sourced,” Zapp says. “This changes the communication between the ingredient supplier and the consumer product company.” 

Under pressure

At the ingredient quality level, multiple factors drive that new conversation. One of those factors has an office in Albany. The New York attorney general’s 2015 herbal supplement investigation challenged the industry and in that challenge delivered an opportunity, says Stephen Lukawski, business development director at Fruit d’Or, suppliers of cranberry and blueberry ingredients. “For the people who take pride every day working to deliver the best possible product, that situation in New York has helped them differentiate themselves from the rest.”

Herbs and botanicals did not suffer the hit people expected in the market last year, growing at 7.5 percent above the 5.9 percent of the industry overall, but the focus on quality across the industry has been felt in every corner. Observers note a growing awareness that adulteration puts whole categories at risk, and the more responsible players in such spaces know that. For ingredients categories where economic adulteration or shoddy manufacture is an issue, suppliers can band together to create a spec and method for verifying that spec. That was the case with astaxanthin. The ingredient became popular, and demand, as it often does, brought in adulteration, explains Capelli. “We saw all these startup companies come in and the quality was really horrible.”

In response, companies formed the Natural Algae Astaxanthin Association and agreed on a specification and standards. NAXA now collectively advocates for the ingredient and holds member companies to a set level of quality. “It’s so easy just to think of a brand. There are probably a half dozen. The hard part is getting quality,” Capelli says. The NAXA seal ensures that quality, he explains.

Implied integrity

Even without a seal, branded ingredients still carry the implied cachet of a more responsibly sourced and better manufactured product. The investment in science, customers might assume, would preclude any supply chain shenanigans. Who would risk the cost of studies and research on poorly sourced raw materials? Still, there is a “trust but verify” dynamic in the mix now that might not have been at play a few years ago. Companies shopping for branded ingredients are unlikely to be shopping by price alone. It follows that if you’re willing to pay the premium, you might want to know what you’re paying for.

More and more, that’s a matter of testing. Companies could demand to see the certificate of analysis or, increasingly, they send the product to a third party lab. Cypress Ingredients CEO Paul Willis calls that practice “the number one big change” in the relationship between ingredient supplier and manufacturer. Independent label analysis might be just a starting point. “The traceability is asking the right questions. Say ‘Ok, you are reporting this. Give us the third-party results, and give us your traceability and your supply chain.”

The problem, for some, is that the answers to such questions cost money. Not every brand wants to pay the added cost. Shaheen Majeed, marketing director at Sabinsa Corp. recalls a recent deal that fell apart when the client saw the bill. “One company has enforced DNA (testing) with us,’ Majeed recalls. “We enforced a price per kilogram extra they would have to pay since for us now, it’s an outsourced test, but then they backed off.”

Such companies want the quality without the cost. “So where’s the equity in this type of testing?” Majeed asks. “Price per kilogram still rules.” Majeed is quick to point out that not every client backs off, and Sabinsa is eager to test every order to spec. “It only elevates our branded ingredients, ultimately giving consumers more confidence,” he says.

Hitting spec isn’t just important for the quality and confidence equation. It’s vital to the science that branded ingredient suppliers are selling. Ingredients that don’t hit spec can’t match the results claimed in the science. If the product doesn’t live up to the science, the whole value proposition is damaged. Willis says he sees too many companies looking for bargains and too many suppliers piggybacking on “borrowed science” that doesn’t hold up with lesser ingredients. “Science-based ingredients means using the exact product in exact conditions at the exact dosage rate,” he notes.

Two stories to tell

The story of the science and the spec cannot be separated from the story of the supply chain, Lukawski says. He recalls working on Cran-Max in the early 1990s and outsourcing the drying and milling. “Every time it came back it was a different color, a different look, a different taste,” Lukawski says.

The process has evolved significantly. At Fruit d’Or every step is vertical—from the cranberry bogs to the standardized powders. The potency of cranberry extracts is based on proanthocyanidins, referred to as “PACs.” The company’s CRAN d’Or and the organic CRAN Naturelle can hit the PACs standard because the company controls the whole process, Lukawsi says. “I couldn’t achieve that unless we grew our own cranberries, brought the cranberries in fresh from the bog,” Lukawski says, going on to explain how the company stores, dries, mills and tests every lot to standardize at 7 to 10 percent potency, the same potency used in trials.

Lukawski wants to tell the story of the supply chain and invite customers to wade into the cranberry bogs. That’s what brands should be doing, he insists. Companies should be, “looking for growing operations where they can go around the world and see firsthand what’s going on, how it’s grown, how they run the companies, how they treat the people,” he says.

That doesn’t happen often enough, Majeed says. Brands are feeling the pressure and asking more questions, demanding more tests, but the site visits are rare. “Our usual invitations go out, but the actual audits that our customers are supposed to do as per GMP are not happening,” Majeed says. “There is something fundamentally wrong here, a disconnect.”

A different level of communication is vital, Majeed insists. In the new demands for quality and traceability comes “the opportunity for suppliers to make the case for a big picture approach to the supply chain,” he says. The supply chain should take into context the environmental impact and the stewardship of the “hundreds of species of herbs that are now on the endangered list.” “Consumers are ever more savvy and want proof that the product they buy is what it’s supposed to be, and meets their values.”

Values matter, not just for consumers but also suppliers.

Science matters too. But confidence may matter more than anything.