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NY Times Today Mentions Splenda and Aspartame


Published: December 22, 2004

Vance Collins, the chief executive of Fuze Beverage, had planned to introduce three more flavors in the company's fast-growing line of Slenderize juice and tea drinks next year. But now, he will introduce only one.

Cadbury Schweppes will be selling two new Snapple flavors beginning in January but is rethinking what other new products it will be able to offer next year.

The problem, these companies say, is that they cannot get enough sucralose, the no-calorie artificial sweetener that has grown from a tiny piece of the sweetener market four years ago to a major player this year. In fact, sold under the brand name Splenda, its yellow packets are now more popular than the blue packets of Equal and the pink ones of Sweet'N Low.

The company that makes sucralose, Tate & Lyle of London, informed customers last month that it could not keep up with demand and that all shipments would have to be rationed on a monthly basis and calculated from past sales.

"Tate & Lyle has decided that we will not be in a position to supply any new customers effective today," Tate & Lyle's vice president for sales, Robert Turner, wrote. Because sucralose is under patent, there are no other manufacturers.

Driven by low-carb dieting and the general desire of many Americans to cut calories, sales of sucralose have skyrocketed over the last year. Its little yellow packets carry the tagline "Made from sugar so it tastes like sugar." Some consumers and health professionals have interpreted this to mean sucralose is less of a chemical than other major artificial sweeteners like aspartame (marketed as Equal and NutraSweet) or saccharin (Sweet'N Low). Dr. Arthur Agatston, a cardiologist and deviser of the South Beach Diet, has endorsed sucralose and has plugged it as "natural."

Manufacturers love it because it has at least twice the shelf life of aspartame. And unlike aspartame, it does not react to heat and can be easily used in baking and in products like yogurt and cereal that use high temperatures during their manufacture.

Even though the market for artificial sweeteners has grown, the success of sucralose has left its rivals struggling. Losses have been particularly acute in the American market for tabletop sweeteners. For Merisant Worldwide, a company in Chicago that makes Equal, its share of the American tabletop sweetener market dropped to 19.4 percent as of Oct. 31 from 23.7 percent last year, according to Information Resources Inc., a market research firm. Sweet'N Low's share also declined, to 15.6 percent from 17.8 percent. The share for Splenda, which is sold by McNeil Nutritionals, a division of Johnson & Johnson, under a long-term contract with Tate & Lyle, has risen to 48.5 percent from 37.3 percent a year ago.

For Tate & Lyle, which also makes traditional sugar products and more than 100 kinds of food starches, the sucralose supply constraints are good problems to have. Thanks in large part to sucralose, which carries much higher margins than the company's other products, profits were up 9 percent for the six months that ended Sept. 30. Since January, Tate & Lyle's shares, which trade on the London Stock Exchange, have soared 54 percent.

The combination of low-carb dieting and the popularity of sucralose among manufacturers has led to a much wider universe of food products that are artificially sweetened. According to Productscan Online, the number of new products introduced each year using sucralose continues to soar, from 573 new products last year to 1,330 through Dec. 13 of this year. Many of these are not just traditional candidates for artificial sweeteners like sodas and gum, but foods like salad dressings, orange juice, breakfast cereal and bread.

Manufacturers say they believe that adding synthetic sweeteners will make their products more appealing to consumers who are conscious about eating less sugar, which, according to the NPD Group, a market research firm, is currently 22 percent of all Americans.

Paul R. Block, the chief executive of Equal's maker, Merisant, acknowledged in a recent interview that the brand had become "a little bit dusty." Mr. Block said he was focused on doing a better job on the marketing and packaging of Equal. He also said that Merisant was considering creating different flavors of Equal. He declined to elaborate.

The NutraSweet Company, which sells aspartame to food and beverage companies, is hitching its future to a new sweetener called neotame, which was approved by the Food and Drug Administration in 2002. The chemical is far sweeter than any of its competitors, so manufacturers will need less of it to sweeten their products, resulting in a cost that is nearly half that of sucralose, according to NutraSweet's chief executive, Craig R. Petray. Mr. Petray said the first products with neotame would reach the market in the next 6 to 12 months. NutraSweet is a unit of J. W. Childs Associates.

In the meantime, Merisant hopes to take some of the air out of Splenda's success with a lawsuit filed on Nov. 26. The suit contends that McNeil's marketing is elaborately misleading and intended to trick consumers into thinking sucralose is similar to sugar. "There is no sugar in Splenda and Splenda's sweet taste does not come from sugar," the lawsuit says. "The truth is that Splenda is sweetened with a synthetic compound that is the result of a complex chemical process."

Two weeks later, on Dec. 10, the Sugar Association also fired a legal shot at McNeil, filing a lawsuit contending that McNeil has "positioned Splenda to compete in the market for wholesome, natural sweeteners, like sugar, molasses and honey." Tate & Lyle is not mentioned in either lawsuit because it has not been involved in Splenda's marketing.

According to the McNeil Web site, sucralose is made by adding chlorine to sugar. Aspartame is not made from sugar but from two amino acids that are isolated from bacteria. Saccharin is produced from a combination of the flavor chemical methyl anthranilate and ammonia.

McNeil officials said they thought the suit had no merit. "We never represented our product as being natural, only that it is made from sugar," said a McNeil spokeswoman, Monica Neufang. NutraSweet said it was not involved in Merisant's lawsuit.

Not everybody has been so taken by sucralose. Whole Foods Market decided four years ago to remove all products containing sucralose from its stores. Margaret Wittenberg, vice president of marketing and public affairs at Whole Foods, said that she was skeptical of the safety of sucralose and that the product did not fit into the company's philosophy of promoting "real food."

Ms. Wittenberg notes that no long-term human studies have yet been conducted on sucralose and that the 172 studies done so far have been financed by Tate & Lyle, McNeil or organizations representing them. Whole Foods also does not carry products containing aspartame, which has been mired in safety concerns on and off since it was introduced in the early 1980's, or saccharine, which for 20 years carried a warning label that it could cause cancer. That label was removed four years ago after new studies.

David L. Katz, a nutrition specialist who is a professor at the Yale School of Public Health, said he had a problem with all sugar substitutes. He said studies had shown that they did nothing to curb sugar cravings and might even cause overeating. "If people really care about eating healthy, they would consume less processed food and eat things like vegetables, fruit, legumes and fish," he said. Ms. Neufang, of McNeil, said that sucralose was safe and that it had been deemed so by the F.D.A.

The immediate problem for manufacturers is getting enough sucralose for products in development. Tate & Lyle has announced plans to increase its capacity, but those moves - spending $75 million to expand its sole sucralose plant, in McIntosh, Ala., and building a new $175 million plant in Singapore - will not have a significant impact until April 2006.

Coca-Cola and PepsiCo both insist that they will not have supply issues. "I think the big companies will likely be in pretty good shape because they will have the resources to reallocate ingredients globally," said John Sicher, publisher of Beverage Digest.

Pepsi has said that it will reintroduce its no-calorie soda Pepsi One next year with the sweetener, and Beverage Digest has reported that Coke will also offer a sucralose sweetened drink.

But smaller manufacturers say they are hurting. By killing two of Fuze's three planned new drinks, Mr. Collins is forfeiting not only future sales but also several million dollars in promotion fees that were already paid to retailers. This was no small move as Fuze's Slenderize line is growing 75 percent a year and represents more than a third of its sales.

Jim Trebilcock, senior vice president of marketing at Cadbury Schweppes, said that the company would have enough sucralose for existing products like 7Up Plus and the two new Snapple flavors, but that Tate & Lyle's rationing was constraining what it could do in terms of creating new products. "I can't get as much as I want," Mr. Trebilcock said. "We're making strategic choices about how to allocate it for our products."

Posted on February 23, 2005 in Aspartame, News | Link To This Entry | Comments (0)


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