Forbes remains bullish despite Reducol failure

- Last updated on GMT

Related tags: Forbes, Contract, Food, Switzerland

Forbes Medi-Tech remains bullish about its prospects for the future
despite the failure of the Novartis-Quaker Oats joint venture which
was meant to promote a range of foods containing Reducol, the
cholesterol-cutting ingredient developed by the Canadian
nutraceutical group.

Forbes Medi-Tech remains bullish about its prospects for the future despite the failure of the Novartis-Quaker Oats joint venture which was meant to promote a range of foods containing Reducol, the cholesterol-cutting ingredient developed by the Canadian nutraceutical group.

Last month, Forbes announced​ that it would not take back the licensing and distribution rights to Reducol from the Swiss group Novartis. Forbes licensed the rights to Phytrol, its cholesterol-lowering food ingredient, to Novartis in 1999, and it was the Swiss group which gave it the brand name Reducol. Forbes is due to regain control of Phytrol in June.

Some critics had suggested that the failure of the Reducol venture would weigh heavily on Forbes' future prospects, but company president Charles Butt was quick to respond to the criticism.

"First and foremost, Forbes' business is fundamentally sound,"​ he said. "The termination of the Master Licensing Agreement (MLA) with Novartis was a difficult decision but it was made in the best interests of our shareholders. In the interim, Forbes is continuing to move forward with its commercialisation plans in North America and internationally, and is in discussions with Novartis with regards to the potential acquisition of the Reducol trademark and termination of the MLA prior to the 90 day notice period."

He continued: "We recognise that Forbes' long-term growth relies on the development of pharmaceutical compounds and the expansion of our pharmaceutical product pipeline. In order to generate the revenue needed to fund pharmaceutical initiatives and build shareholder value, the company is aggressively pursuing both third-party contracts and potential business partners for its nutraceutical and pharmaceutical steroid businesses."

As far as the nutraceutical business was concerned, Butt said that Forbes had signed confidentiality agreements with food manufacturers in Japan and was working to secure contracts to supply food-grade sterols to these customers. He added that discussions were also underway with several US food and beverage manufacturers to introduce products enriched with Forbes' cholesterol-lowering sterol-based food ingredient into the US market.

Forbes also recently appointed a US consultancy group to help it identify additional international clients and to develop new nutraceutical products.

Butt also announced that the company expected to make an announcement about additional funding within a month, following talks with a number of potential investors.

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