When chocolate’s not enough

Nestlé’s new Health Sciences arm ventures into specialty pharma with purchase of Prometheus

Kimberely Sirk
LUTRY, Switzerland—Nestlé Health Science SA purchased SanDiego's Prometheus Laboratories Inc. in late May as the Swiss food giant seeksto enter the space where food companies and drug companies meet, but do notquite intersect.
 
Prometheus, which was founded in 1995 and was activelylooking for new owners, specializes in diagnostics and in-licensed specialtypharmaceuticals in gastroenterology and oncology, focusing on conditions suchas inflammatory bowel diseases like Crohn's disease and ulcerative colitis.
 
Nestlé SA first entered the healthcare nutrition field in1986. It announced last September the creation of Nestlé Health Science and theNestlé Institute of Health Sciences to pioneer a new industry between food andpharma.
 
These two separate organizations will allow Nestlé to delveinto the burgeoning domain of personalized health science nutrition, whichseeks to prevent and treat health conditions such as diabetes, obesity,cardiovascular disease and Alzheimer's disease, based largely on patientcharacteristics.
 
Nestlé Health Science, a wholly owned subsidiary of Nestlé,launched Jan. 1. The new company will be run at arm's length from Nestlé's mainfood, beverages and nutrition activities, and incorporates the existing globalNestlé HealthCare Nutrition business. Nestlé Health Science will also haveaccess to external scientific and technological capacity through Nestlé'sinnovation network, as well as a number of venture capital funds in which thegroup has interests.
 
The Nestlé Institute of Health Sciences is part of Nestlé'sglobal R&D network. The institute conducts research in relevant areas ofbiomedical science to translate this knowledge into nutritional strategies toimprove health and longevity. The institute is based in the multi-disciplinaryscientific environment of the Swiss Federal Institute of Technology in Lausanne,where Nestlé is already involved in two life-science initiatives.
According to a statement by Nestlé Health Science, whoserepresentatives did not respond to a request for an interview, Prometheus'capabilities strongly support Nestlé Health Science's ambition of pioneeringscience-based nutritional solutions to deliver improved personalizedhealthcare.
 
Luis Cantarell, Nestlé Health Science's president and CEO,said in a prepared statement that the purchase successfully moves the companyinto a strategic position within the gastrointestinal diagnostics space.
 
"Prometheus' leading-edge diagnostics and highly experiencedmedical sales representatives together constitute a robust platform for NestléHealth Science to accelerate its current and future healthcare business,"Cantarell said. "It will enable new personalized healthcare solutions based ondiagnostics, pharma and nutrition."
 
For its part, Prometheus reps look forward to sealing thedeal, which will transpire after the normal regulatory process, and moving onto support the work of the recently created Nestlé Institute of HealthSciences.
 
"The new health science subsidiary of Nestlé is looking tooperate within the white space between where drug companies stop and where foodcompanies stop," says Mark Spring, Prometheus' senior vice president of financeand chief financial officer. "We have capabilities in the gastrointestinaldiagnostic space that Nestlé was very interested in—our diagnostic platform,and our market position in the gastro space."
 
Prometheus's strong expertise and R&D ingastrointestinal diagnostics will accelerate the research program that is beingestablished in the newly created Nestlé Institute of Health Sciences. It willcreate new opportunities for developing personalized nutrition strategies thatwill help in the management and prevention of chronic health conditions. TheR&D pipeline will encompass other areas of strategic interest for NestléHealth Science, such as metabolic conditions and brain health.
 
Joseph M. Limber, Prometheus' president and CEO, indicatedin a prepared statement that he is pleased to see his company evolve in thisway.
 
"We are delighted to join Nestlé Health Science, and sharetheir commitment to personalized healthcare," he stated. "Together, we willaccelerate the development of our innovative diagnostic platforms forgastroenterology and oncology. We intend to leverage Nestlé Health Science'sproducts and geographic presence to add the nutritional dimension to oursuccessful business model."
 
About 500 employees of Prometheus will join Nestlé HealthScience as a result of the acquisition.
 
Spring says the two companies are now in the process ofintegration planning, with the deal expected to close in July. He saysPrometheus will retain its individual identity and its own autonomy in itsoperations.
 
"Wesee ahead continued growth," Spring concludes. "Our joint perspective is thatwe'll see that growth as we move ahead and foresee continued revenue synergiesworking with Nestlé and its nutritional division in the future."

Kimberely Sirk

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