Raisio extends rights to cholesterol-busting Benecol

By Alex McNally

- Last updated on GMT

Related tags United states European union Raisio

Raisio has reached an agreement with its European and American
partners to extend its rights to the cholesterol-lowering Benecol
brand in France and the United States.

The firm said yesterday that an amendment had been signed between McNeil Nutritionals in the States and Cilag GmbH International, which will put Raisio in the driving seat of Benecol and its plant stanol ester. The Finnish company has struggled to remain profitable in recent times. Its food division experienced a 'deeply unprofitable' 2006, struggling to cope with price increases and major restructuring. Neither McNeil Nutritionals nor Cilag are active in the French or American markets, Raisio said, but the firm will make royalty payments and provide marketing support to McNeil and Cilag as part of the agreement. The amendment will also return rights to Raisio's stanol ester back to the company in United States, UK, France and Ireland. A Raisio spokesperson said the firm wanted to be an "active player" in the European, Asian and United States markets for cholesterol-lowering functional foods. Over the past decade, the Finnish company has built up the Benecol brand from scratch. In 2005 it had 14 licensees and products sold in some 30 countries, and reported Benecol-ingredient turnover of €44.7 million in 2004. However, since then Raisio has been hit by a fall in cash after revealing its half year results in August. The firm indicated that sales of the Benecol brand were strong, and saw a rise in sales; however, the company did not reveal exact numbers. Earlier this month Raisio announced a round of job losses in a bid to boost profits in the wake of this summer's financial results, which saw a shortfall in its ingredients arm by nearly €4m. The firm's interim results showed a plunge in turnover, falling from €27m to €23.1m year-on-year. The last few years have proven difficult for Raisio, which shed nearly 90 jobs as part of a restructuring effort to save €9m last year, and its efforts to boost is profitably are far from over. Cilag will retain exclusive rights to the Benecol brand in Great Britain, Ireland, Belgium, and Luxembourg. McNeil and Cilag will also retain rights in the categories in which they currently hold strong positions in both France and the United States. A spokesperson added: "Raisio aims to be an active player in the growing European, Asian and United States markets for cholesterol-lowering functional foods by introducing innovative product applications. "Raisio's strength in different market areas is its adaptability. This means that Benecol brand products are launched in the market with local partners in applications matching the local consumption habits."

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