Believers, Achievers, Industry Leaders

January 19, 2007

Profiles of the people behind the natural product industry's best companies, ideas, products, and technologies.

 

LOREN ISRAELSEN

Make no mistake, Loren Israelsen is a nice guy, but beneath his polite exterior lurks a tenacious, skilled infighter. Over the years, he and his association, the United Natural Products Alliance (UNPA; Salt Lake City), have taken on FDA, Congress, various trade associations, the Codex Alimentarius Commission, and, on more than one occasion, the industry itself.

Israelsen became interested in natural products as a Nature’s Way (Springville, UT) intern in 1979. A lawyer, he was instrumental in the creation and passage of the Dietary Supplement Health and Education Act (DSHEA). In 1992, he helped found and build UNPA.

His passions lie with issues that cast shadows on product quality. He cajoles companies to adopt third-party quality programs as a means to shore up consumer confidence. He has pushed FDA on BSE and ephedra. And he criticizes lawmakers who try to impose limitations on supplements or drive wedges in DSHEA.

He says he does it for two reasons. “First, I have no other useful job skills. The other is that my industry friends really are extended family,” says Israelsen. “The longer I am at this, the clearer it becomes that the continuing battles we seem to fight as an industry are really about first principles that make a huge difference in people’s lives. Now that is a motivator.”

Looking ahead, Israelsen wants to preserve the industry’s cultural tradition and heritage. “No doubt there is a bit of nostalgia involved here, but meeting some of the legendary figures from the last several generations of our industry had a profound effect on me,” he says. “Their passion, charisma, and willingness to sacrifice for a shared belief really affected me. Many of these legends are quickly fading away in our hearts and memories. Who will inspire the next generation?”

He feels that projects, funded by industry leaders, could have a wonderful and transforming effect on the present and future generations of consumers and industry members. “The Boulder History Museum has opened the Tea to Tofu exhibit, which tells the story of Boulder’s natural food phenomenon,” Israelsen says. “Brilliant idea, and hats off to our industry friends in Boulder.”

“FDA is celebrating its 100th anniversary. It commissioned a big and very nicely done coffee-table book to commemorate this history,” says Israelsen. “Even if you don’t like FDA, one must admire the value and contribution of such a book. I would love to see a traveling exhibit about our industry’s history that would be given prime real estate at the trade shows. I think it would be a huge hit (and some good laughs) to see what our magazines, product labels, political battles, and even fashions looked like 30, 40, or 50 years ago.”

Israelsen also believes the industry should establish memorial scholarships and internships in the name of industry visionaries for young people and students.

Among other projects, UNPA has been working on a history of the Utah supplement industry. “It seems a tragedy to me to fight so hard to protect our natural health rights and lose that tradition of health freedom along the way,” says Israelsen. Who would argue otherwise?

XANGO

What are the odds that by 2009, a group of young entrepreneurs can build a $1 billion market from an obscure, slow-growing, finicky fruit that is virtually unknown outside of Southeast Asia?

Welcome to XanGo, a beverage based on a whole-fruit puree of mangosteen (Garcinina mangostana), and a company created by Aaron Garity, Gary Hollister, Joe Morton, Gordon Morton, Bryan Davis, and Kent Wood.

XanGo, the beverage, is a blend of reconstituted Garcinia mangostana juice from whole fruit puree, and apple, pear, grape, blueberry, raspberry, strawberry, cranberry, and cherry juice concentrates, along with citric acid, natural flavor, pectin, xanthenes gum, and sodium benzoate. The beverage is said to be high in xanthones, antioxidants that may protect against free radicals. It may support the immune system and also support joint health and flexibility.

XanGo, the company (Salt Lake City), is a mixture of tried-and-true network-marketing principles and digital-era pyrotechnics. The results are dramatic. In three years, XanGo recruited 400,000 distributors, all selling 25-oz bottles for $25–$40. Nutrition Business Journal ranked XanGo fifth among network retailers. Its national conventions attract thousands of distributors as well as political figures such as Salt Lake City mayor Rocky Andersen and Senator Orrin Hatch (R–UT).

Gordon Morton, chief marketing officer, known to use XanGo and Rosa Parks in the same sentence, attributes XanGo’s growth to his upbringing. “My father opened the first division of Nature’s Sunshine in Canada, and my mother owned a natural products, healing life-styles store,” he says. “I was fortunate to experience the ‘latest and greatest’ in nutritional supplements throughout my formative years. My natural affinity for the nutritional industry led me to my inevitable career path and the opportunity to bring the mangosteen to a worldwide marketplace.”

Part of XanGo’s appeal is its commitment to social issues. Part of every XanGo Juice sale goes to charity. The XanGo Goodness program urges distributors and consumers to use their social consciousness for positive change.

“Since day one, we made a commitment to give back,” says Morton. “Before any profit was made or investors paid, we knew this would be an integral part of the company’s philosophy. XanGo Goodness is a movement! Leadership is action, not position. Our driven, global distributor network is making a huge grassroots difference by selling XanGo Juice and getting involved with their respective communities.”

Critics charge that research does not support XanGo the beverage or XanGo the company. Morton disagrees. “The mangosteen is an amazing botanical, and science is catching up to consumer demand,“ he says. “We are in the process of developing and providing expanded research and science to the marketplace. We feel the natural-products industry needs to take responsibility to lead research initiatives and reinforce established science. In a nutshell, as our industry grows, so must our sophistication with regards to brand, social conscience, and science.”

VITAMIN ANGEL ALLIANCE

Howard Schiffer, founder and executive director of the Vitamin Angel Alliance (Santa Barbara, CA), has put more holes in suits than a bad dry cleaner.

Schiffer carries around what seems to be an infinite supply of Vitamin Angels pins. Spend five minutes with him and you’ll have one in your lapel. Spend 10 and you’ll wonder how best to support his cause.

His mission is compelling. In malnourished third-world populations, a few cents worth of multivitamins or supplements translates into enormous health benefits. With its partners, Vitamin Angels sends hope to millions.

The Alliance, formed in 1994, is prolific. Last year, the Alliance donated more than 100 million supplements to 40 countries, including Honduras, India, Guatemala, Haiti, the Dominican Republic, Jamaica, the Congo, Iraq, South Korea, Tanzania, Venezuela, Kenya, and Mozambique, plus New Orleans and dozens of other locales.

Vitamin Angels partners with relief agencies, suppliers, and manufacturers. When a survey uncovered that 70% of Tibetan children were vulnerable to rickets, Vitamin Angels teamed with the Terma Foundation (Half Moon Bay, CA) to send monthly shipments of 650,000 multivitamins to Tibet. Vitaquest International (West Caldwell, NJ) recently pledged $60,000 in product and financial contributions. Vitaquest will produce a UNICEF-approved formula of children’s multivitamins for distribution to thousands of children in Honduras and the Dominican Republic. And Rainbow Light (Santa Cruz, CA) has delivered nearly 4 million prenatal multivitamin tablets to pregnant and lactating women since July 2000 and supplied hundreds of thousands of children’s chewable multivitamins over the last year to underserved areas around the world.

Schiffer’s latest initiative is Operation 20/20. The goal: in 2007, eliminate nutrient-deficient childhood blindness by giving vitamin A tablets to 4.5 million children in 26 countries worldwide. “Vitamin A–deficiency childhood blindness is a preventable global health crisis of alarming proportions,” says Schiffer. “This ravaging form of blindness is preventable with vitamin A supplements at a cost of about 5 cents per child per year, and we will reach 6 million children, lactating mothers, and infants in the three-year pilot program.”

In October, industry leaders donated $1.5 million in cash and products during a fund-raiser hosted by Schiffer and Tom Aarts, one of Vitamin Angels’ directors. Among the corporate contributors: Airborne (Bonita Springs, FL); Allen Greene; Andrew Lessman/Procap Laboratories (Henderson, NV); Cantox (Bridgewater, NJ); DSM (Parsippany, NJ); Econet/Univera Life Sciences (Lacey, WA); END Merck; Hidden Villa (Los Altos Hills, CA); Kang Nian Zhu; LPNY Ltd.; Marine Nutriceutical (Mt. Bethel, PA); Natrol (Chatsworth, CA); Natural Factors (Everett, WA); Nature’s Way (Springville, UT); NPI Center (Georgetown, ON, Canada); NTI Corp.; Ocean Nutrition (Dartmouth, NS, Canada); Paragon Labs (Torrance, CA); Pharmachem (Kearny, NJ); Pure Fruit Technologies (American Fork, UT); Purity Products (Plainview, NY); Red Roxx, Skyline (Henderson, NV); Solar Nutrition; Source Salba (Toronto); Tishcon (Westbury, NY); SPINS (Schaumburg, IL); Vitamer (Lake Forest, CA); Vitaquest (West Caldwell, NJ); and Wild Oats (Boulder, CO).

Angels, one and all.

CAFFE SANORA

A few cups of coffee might be good after all. In November, scientists analyzing data from the Iowa Women’s Health Study discovered that women who drank from one to three cups of coffee per day were less likely to suffer from inflammatory ailments including heart disease. The study didn’t pinpoint why, but researchers suggest antioxidants may play a major role.

The study is the latest installment in the ongoing debate about coffee’s risks and benefits. In the past, coffee has been linked to a host of ailments. Today, however, science has shown positive health benefits from moderate coffee consumption. While not definitive, studies published in 2006 correlate coffee with reduced risk of type 2 diabetes, inflammatory diseases, Alzheimer’s disease, and blood clots.

The intense investigation has focused attention on the role that antioxidants play in coffee. While scientists haggle over coffee’s risks and benefits, they tend to agree that the antioxidants in coffee are beneficial.

This is good news for Loretta Zapp, CEO of Applied Food Sciences (AFS; Austin, TX). AFS developed the HealthyRoast Process, which delivers coffee beans with 30% higher antioxidant content than green tea. Conventional roasting destroys many of the antioxidants in the green beans.

Armed with HealthyRoast, Zapp launched the Caffe Sanora brand of premium gourmet coffee in 2005. Available in light, medium, and dark roasts, and whole bean, regular, and espresso grinds, Caffe Sanora is available in select health-food stores such as Wild Oats, mainstream grocery stores such as Ralphs, and Caffe Sanora’s Web site.

Originally, Applied Food Sciences was involved with cancer research. When angel investor funds dried up, AFS explored the compounds in green coffee beans. The question that begged an answer: If so many polyphenols reside in green beans, shouldn’t coffee be healthy?

HealthyRoast was the solution. Whereas other roasting processes extract polyphenols, HealthyRoast adds back antioxidants at a crucial point in the process.

AFS expected to sell or license the technology to big beverage companies. “We didn’t set out to build a brand,” says Zapp. “It worked out that way.”

Using guerilla marketing methods, the company spread the news about the antioxidant content of Caffe Sanora. Eventually, the brand caught on in select health-food stores and mass grocery chains. The rest is almost history.

According to the company, the number of coffee drinkers continues to increase, with more than 52% of Americans drinking coffee daily. This is the ideal environment for Caffe Sanora, derived from the word sano, which means health in Italian. “The good news for coffee lovers is that coffee can actually be healthy,” says Zapp. “Consumers who are taking an interest in their health can now enjoy their morning cup of coffee knowing they are doing something good for their bodies. Caffe Sanora is 100% organic, contains more antioxidants than most green teas, and has a rich, full-bodied flavor.”

JACQUELINE SHAN

Jacqueline Shan, PhD, grew up in China during the Cultural Revolution. Today, she is witnessing a revolution of a different kind: a new way of combating cold and flu symptoms. This fall, her company celebrated the American launch of Cold-fX, Canada’s top-selling natural cold and flu remedy.

When Shan took over as CEO of CV Technologies Inc. (CVT; Edmonton, AB, Canada) in 2003, the company had sales of just $1.5 million, a balance sheet that was in the red, and a market capitalization of $5 million. Today, CVT has annual sales of more than $30 million, profits of more than $10 million, and a market cap that exceeds $400 million. The company has set its sights on the congested North American market for cold and flu products, which could be worth at least $3 billion.

Shan has had an ambitious agenda for CVT and Cold-fX, a patented extract of Panax quinquefolius. In 2006 alone, CVT received New Dietary Ingredient clearance from FDA for Cold-fX, launched the product in the United States, recruited hockey legend Mark Messier as its celebrity spokesman, and broke ground on its brand-new $10 million corporate headquarters. CVT also managed to get Cold-fX included in the 2007 Physicians’ Desk Reference, a publication read by hundreds of thousands of healthcare professionals around the world. Since 1992, CVT has poured more than $20 million into R&D for its standardized ingredients, including seven clinical trials for Cold-fX. One of the trials was a Phase II investigational new drug trial completed in 2001.

Shan also has an important long-term goal for CVT: In February, she announced that the company plans to seek FDA approval of Cold-fX as an OTC drug, a process estimated to take at least three years and cost at least $30 million. It’s often said that when America sneezes, Canada catches a cold. If Shan continues on her path, America’s sniffles could bring Canada billions of dollars instead of just a runny nose.

SENATOR-ELECT JOHN TESTER (D–MT)

At first glance, farmer Jon Tester seemed an unlikely candidate for the halls of the U.S. Senate. Born and raised near the small town of Big Sandy, MT, Tester holds a degree in music and has spent much of the past three decades raising organic crops like wheat, barley, lentils, peas, millet, buckwheat, and alfalfa on his family farm. But in this year’s midterm election, Tester defeated Conrad Burns, the longest-serving Republican senator in the history of Montana.

Tester began his political career eight years ago in response to energy rate hikes in Montana. Since then, he has been a strong advocate of small farmers, championing causes such as renewable energy, country-of-origin labeling, and improving access to healthcare. Tester reportedly took a week off from campaigning in the fall to harvest grain. In July, he admitted to Time magazine that he does some of his best thinking on his tractor.

It would be a mistake to think that Tester doesn’t have the solid political credentials that will help him get his views across in Washington, however. He completed four terms as a Montana state senator, including stints as minority whip, minority leader, and president of the Senate. Now he plans to put his skills to use in the nation’s capital.

Time will tell if Tester’s approach will benefit the country’s organics industry, which sells about $15 billion worth of products a year. In October, the Organic Trade Association (OTA; Greenfield, MA) asked Congress to add provisions to the 2007 Farm Bill that would help foster the transition to organic agriculture and strengthen the National Organics Program. OTA, and others involved in the manufacture of organic foods and supplements, may finally have at least one set of receptive ears in DC.

Angela Caudle, executive director of the International Federation of Organic Agriculture Movements (Bonn, Germany), praises Tester’s knowledge of the field. “His understanding of of soil ecology and the economics of organic production systems will undoubtedly bring a fresh perspective to the U.S. Senate and contribute to the establishment of more-sustainable agriculture programs,” Caudle says.

SENATOR ORRIN HATCH (R-UT)

A little-known fact about Orrin Hatch is that he is an accomplished musician and vocalist. It’s common knowledge, however, that Utah’s longest-serving senator has been a leading voice for the natural products industry for more than a decade.

First elected to the Senate in 1976, Hatch was instrumental in the passage of the Dietary Supplement Health and Education Act (DSHEA) as well as many other important pieces of health-related legislation. As a member of the Senate Health, Education, Labor, and Pensions Committee (HELP), Hatch also has played an important role in overseeing FDA and other food-safety issues.

One of Hatch’s greatest strengths is his willingness to work on building a consensus with other members of Congress who are less receptive to the supplement industry. For example, earlier this year, Hatch reached an agreement with Senator Dick Durbin (D–IL) on mandatory adverse-event reporting for supplements and over-the-counter drugs, crafting the Dietary Supplement and Nonprescription Drug Consumer Protection Act (S. 3546).

A strong believer in DSHEA, Hatch has defended the act numerous times before Congress. In a 2004 speech to the Senate, Hatch cited extensive research documenting the benefits of multivitamins, including a Lewin Group (Falls Church, VA) study linking supplement use to a potential cost savings to Medicare of more than $1.5 billion over five years. More recently, on June 21 this year, Hatch called the growing popularity of supplements “a testimony to a vibrant industry that is producing positive benefits for our people and our economy.”

“As a consumer of dietary supplements myself,” Hatch said, “I know the health benefits they can produce.”