Large company starts selling glucosamine
Rexall -
Glucosamine /Chondroitin -2: To Mkt In U.S., Canada
03/31/97
Dow Jones
News Service
(Copyright (c) 1997, Dow Jones & Company, Inc.)
BOCA RATON, Fla. (Dow Jones)--Rexall Sundown Inc. (RXSD) signed an exclusive licensing agreement to market Nutramax Laboratories Inc.'s new dietary supplement, which contains Glucosamine and Chondroitin, in both Canada and the U.S.
In a press release Monday, the company said the product is designed to promote healthy mobile joint function and connective tissue.
Rexall said the product will be marketed as a National Brand called Sundown Glucosamine and Chondroitin. Nutramax will continue to market a higher dosage of the product, called Cosamin DS, through licensed health care professionals and behind the counter at pharmacies.
Marketing of the product will begin within eight weeks.
Rexall Sundown develops, manufactures and distributes vitamins, nutritional supplements and other consumer health products.
Nutramax Laboratories Inc., based in Baltimore, holds the patented formula for Glucosamine and Chondroitin.
Rexall Sundown Finds Success With
Nutritional Arthritis Supplement
By Kate Berry
12/31/97
Dow Jones Online News
(Copyright (c) 1997, Dow Jones & Company,
Inc.)
MIAMI -(Dow Jones)- When vitamin and nutritional supplement maker Rexall Sundown Inc. began marketing a supplement based on a best-selling book, "The Arthritis Cure," the company had no idea how big a winner it had.
"It caught on very quickly," said Chris Nast, Rexall Sundown's president and chief executive. "We didn't really expect it."
In just six months, Rexall Sundown's (RXSD) patented formula, Osteo-Bi-Flex, has become the third-best-selling nutritional supplement in the country, ahead of vitamins One-A-Day, Centrum and Centrum Silver, Nast said.
Sales of the product hit $12 million in the first quarter, ended Nov. 30, and the company forecasts at least $40 million in sales in 1998 - nearly twice its original estimate.
"The initial reception has been huge," said Michael T. Moe, an analyst at NationsBanc Montgomery Securities Inc.
For Rexall Sundown, based in Boca Raton, Fla., the new product is a springboard into a burgeoning area of the vitamin and supplement business: so-called "scientifically-based" products with the potential to blossom as national brands.
"This is a third vehicle of growth for us that wasn't even in our strategic plan three years ago," said Nast, a former vice president at Colgate-Palmolive Co. (CL) who joined Rexall Sundown in 1995.
Analysts said Osteo-Bi-Flex also is a demographic goldmine. More than 35 million Americans suffer from the most common form of arthritis, which affects the joints and causes chronic pain.
Though Rexall Sundown had nothing to do with "The Arthritis Cure," it is certainly benefiting from the word-of-mouth the book generated. That's substantial: More than two million copies have been sold in hardcover and paperback, and the book hit No. 1 on the New York Times best-seller list.
In the book, Dr. Jason Theodosakis examines more than two dozen studies world-wide that suggest a combination of two supplements, glucosamine and chondroitin, can reduce arthritis pain. Theodosakis told Dow Jones that the supplement combination has hit the market in at least 50 different formulas since "The Arthritis Cure" was published in early 1997.
"There are a lot of different products out there and some of them make my treatment program look ineffective," said Theodosakis, a sports-medicine specialist who suffered from arthritis himself and spent nearly 10 years searching for a cure.
"I've seen Rexall (Sundown)'s ads on TV and they're one of the few companies that's the cream of the crop," he said.
According to press reports, glucosamine and chondroitin are found in the joints and other connective tissue. Glucosamine encourages the production of new cartilage, while chondroitin keeps enzymes from tearing the cartilage down. Some doctors, however, dismiss the idea that nutritional supplements taken orally can do any good, while other are starting limited studies to test Theodosakis' claims.
So many arthritis products have come on the market in the past year that Theodosakis said he planned to endorse three formulas, including Osteo-Bi-Flex, before his second book, "Maximizing the Arthritis Cure," is published in a few months.
But some analysts question whether any arthritis product has staying power and can generate repeat business. Others say Rexall Sundown is throwing off exceptional numbers, far exceeding the results shown by other companies selling similar arthritis formulas.
Through heavy promotion and advertising directed at the over-50 crowd, Osteo-Bi-Flex has moved Rexall Sundown into the ranks of national brands.
The company, which is quick to get advance word of new studies and published articles, got a license for its formula in March from Nutramax Laboratories Inc. of Baltimore, which holds the patent.
"Osteo-Bi-Flex has become the Kleenex of the business," said John T. Mahoney, an analyst at Raymond James & Associates Inc.
Rexall Sundown went so far as to change its traditionally thrifty ways by opening its wallet to advertise for the first time in its 21-year existence. It plans to spend $10 million on advertising Osteo-Bi-Flex in 1998.
Geary Cotton, Rexall Sundown's chief financial officer, said the focus on science has heightened since the company began prowling for acquisition candidates and products. A proposed purchase of Twin Laboratories Inc., based in Ronkonkoma, N.Y., fell through in September.
Last week, the company bought Richardson Labs Inc., a Boise, Idaho, maker of diet and weight-management products, in a stock transaction valued at $85 million. The company plans to market and distribute Richardson's products, which include another arthritis formula, much as it has Osteo-Bi-Flex.
Rexall Sundown has at least $100 million in cash for future purchases, said Mahoney.
For the year ended Aug. 31, 1997, Rexall Sundown posted net income of $35.1 million, or $1.03 a share, on sales of $263.4 million. For the latest first quarter, ended Nov. 30, the company reported an 87% jump in earnings to $13.6 million, or 19 cents a share, on an 83% rise in sales to $102.5 million from a year ago.
Copyright © May 20, 2008 6:24 AM by Karl Loren on behalf of Vibrant Life, ALL RIGHTS RESERVED. Permission is granted for non-commercial downloading, copying, distribution or redistribution on two conditions: One, that some form of copyright notice is included in every copy distributed or copied, showing the copyright belonging to Vibrant Life, Burbank, CA, at www.oralchelation.com . The second condition is that the material is not to be used for any purpose contrary to the purposes and objectives of this site. This permission does not extend to materials on this site which are copyrighted by others.
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