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Bioprogress to introduce vegetarian capsule technology

Corporate concern over mad cow disease is accelerating interest in vegetarian- based encapsulation technology offered by Bioprogress plc (Atlanta, Ga.).


"Leading pharmaceutical companies have told us collectively that they do not want to introduce any new products in gelatin because of testing," said Larry Shattles, executive vice president of Bioprogress. Bovine-based gelatin capsules raise the specter of mad cow disease, an issue most companies would prefer to avoid "before they put a couple of billion dollars into a new product," Shattles said.

Bioprogress began researching vegetarian alternatives to gelcaps long before mad cow disease (bovine spongiform encephalopathy, or BSE) was discovered in the United States. "We haven't tried to jump on this bandwagon," Shattles said. But BSE has fueled interest among companies seeking non-gelatin capsules not only for vegetarian consumers but nonvegetarians as well, he confirmed.

Bioprogress sells machinery to produce non-gelatin capsules, along with a nongelatin, vegetarian-based film called hydroxypropyl methylcellulose (HPMC). Like gelatin, the nongelatin film masks tastes and odors. "We have other possibilities in terms of technology. One is a tablet wrap-wrapping an existing tablet in our film as opposed to dipping it or spraying it," said Shattles.

Founded in the United States over than five years ago, Bioprogress initially listed on the Over the Counter bulletin board. But last year, the company moved its operations to England in order to be listed on the London Stock Exchange. "In this depressed market, we were having trouble getting started," recalled Shattles, the only remaining U.S. employee at the company's Atlanta office. "You have to be over $5 a share here to talk to investment banks... so we moved all of our scientists and technology over to the U.K."

The move has paid off. The company has raised $13 million on the stock market and seen its stock price soar from 25 cents to $1.30 a share. To date, the company has worked primarily with pharmaceutical clients, including Peter Black Healthcare, a leading English capsule manufacturer recently purchased by Perrigo, a U.S. company. "They are a big private label manufacturer for the mass marketers, " Shattles said.

Recently, Bioprogress announced that it has signed a letter of intent to enter into a global strategic alliance with a major U.S. pharmaceutical company. Under the agreement, the U.S. company will purchase an exclusive license for XGEL dosage forms for a specific market sector and for the geographic areas of America and the European Union. The agreement also provides Bioprogress with exclusive pharmaceutical standard film production capacity in the North American market.

Next up, Bioprogress hopes to enter the North American dietary supplement market. "There is a huge market here in the states that we haven't really hit yet," said Shattles, who plans to introduce the nongelatin capsule technology at the Natural Product Expo in Anaheim this spring.

Harro Hoefliger, a German company, will produce machinery for the encapsulation technology, which Shattles maintained is "quite simple in terms of a physical plant. Someone who is not even making capsules now, who might be using a supplier, could conceivably become a manufacturer." The nongelatin capsule technology is suitable for all non-aqueous substances, he added.

As an added inducement, Bioprogress said it plans to offer attractive pricing compared gelatin encapsulation. How attractive? "It should be less expensive than animal-based gelatins," said Shattles.

Although Bioprogress has seen short-term growth in Europe, long-term Shattles believes that North America holds even greater promise. "We know that the U.S. will be our biggest market," he predicted.