Tapping into fungi’s potential: 2023 SupplySide West Report


Current innovations and building a future for fungi ingredients.

Photo © AdobeStock.com/ExQuisine

Photo © AdobeStock.com/ExQuisine

Within the dietary supplement industry, fungi-based products represent a growing category with a number of promising applications. According to data from SPINS, the 52 weeks ending October 30, 2022, mushrooms were among the top 25 best-selling ingredients in the natural channel, growing 15% compared to the previous year. While there are extracts derived from specific mushrooms on the market, our knowledge of mushrooms and other fungi-based products is really in its infancy.

“We barely scratched the surface in understanding fungi. It's a huge kingdom. We really only understand 5-10% of all fungi that exist in the world,” says Lisa Wetstone vice president, marketing, innovation and strategy at MycoTechnology (Aurora, CO). “So, when you think about how much we've achieved with plants…the fungi kingdom has even more potential than that. And yet, right now, all we kind of think about are, you know, mushroom powders or the mushrooms you see at the grocery store.”

Looking ahead at the potential for innovation and product development, mushroom ingredient supplier, Sempera Organics, has signed three memorandums of understanding with different firms to help drive this innovation. Namely, the company has partnered with Alkemist Labs to advance bioactive testing of fungi, Sinoveda Canada to develop fungi-based bioactive formulations, and Good Machine to accelerate and scale fungi-based food production.

“No one company can do it all. And there are a lot of specialists out there. And we'd like to partner to get to our final goals fast,” says Nirmal Nair, CEO of Sempera Organics. In the case of its MOU with Sinoveda Canada, for example, Nair explains: “[Sinoveda is in] the business of figuring out how these various bioactives found in nature can work together to address a particular need. They have several patents that they already filed for other ingredients and other spaces, but not in mushrooms. So, they are looking forward to working with us because we are creating all these [products from] various species of mushrooms, and ingredient blends. We want to truly understand what is the exact bioactive from each of those that can interact together. And they bring years of that knowledge and actual practice of having done bioactive-based drug discovery.”

We attribute so many health benefits to various fungi species but our understanding of the underlying mechanisms behind these benefits is rather small, and there is so much potential for discovering exciting new benefits from fungi. Commenting on the potential health benefits for bioactives derived from fungi, Nair emphasizes the importance of immunity. While it seems like well-trodden territory, the COVID-19 pandemic woke us up to just how vulnerable we are to new diseases, reinforcing the need to novel ways to defend ourselves. There is also the potential for stress and other brain health benefits, as well as physical performance, aging, and skincare.

“I actually feel that there's a lot more out there that has not been discovered yet,” says Nair. Specifically, he looks to the potential of fungi to help our bodies heal and defend themselves. “That’s a lot of what fungi do, as opposed to a drug which can go and attack a virus by itself, [fungi] really tells the body how to defend itself and change itself,” Nair explained.

Fungi innovations

One brand unlocking the potential of fungi is Nammex, which launched two fungi-based whole food ingredients at SupplySide West: ErgoGold and MycoD2. ErgoGold is an extract of golden oyster mushrooms that delivers a high concentration of ergothioneine which is an amino acid and antioxidant commonly found in mushrooms.

“We found this specific strain of golden oyster that has high levels of ergothioneine. Ergothioneine is present throughout the body and all of our cells and current research is showing that as we age, there is a decrease in our ergothioneine levels,” explains Skye Chilton, CEO of Nammex. “In fact, some researchers have stated that ergothioneine is potentially a longevity vitamin. Research is still ongoing, but certainly to get a beneficial amount of ergothioneine, you need to eat mushrooms. We don’t get a lot from our diets normally, so a fungal based mushroom extract like ErgoGold is an excellent supplemental source.”

Chilton explains that the ingredient is made by grinding the oyster mushroom into a powder, doing a hot water extraction that produces a spray dried powder. After that, Nammex analyzes the ergothioneine content to make sure it meets its standards. “Because it’s a whole food, it still contains all the mushroom components,” says Chilton. “You’re getting things like beta glucans, ergosterol, and a lot of the other mushroom compounds that are still present, as opposed to a pure isolated ingredient.”

The company’s MycoD2 is a plant-based vitamin D derived from maitake mushrooms. Chilton explains that mushrooms contain ergosterol and that when mushrooms are exposed to UV light, ergosterol converts to ergocalciferol, which is vitamin D2. Specifically, the company uses a special high pulse UV light technology. Chilton says that Nammex can guarantee 10,000 IU per gram of vitamin D2 and hopes to increase this number in the near future. Most vitamin D comes from lanolin in sheep’s wool, so having a plant-based option is of value to consumers, especially since many are deficient of the vitamin, adds Chilton.

Some manufacturers are using fungi to transform other ingredients. Mycotechnology, for example, is using mycelia to ferment plant proteins to improve their nutrition and organoleptic properties. “We like to refer back to the centuries of history of fermentation. It's essentially just the process of transforming or breaking down a substrate to change, transform, make it better. And there's lots of different microbes that could perform that type of process, and for us the magic is really just the enzymatic capabilities of mushrooms or fungi,” explains Mycotechnology's Wetstone. She goes on to explain that mycelia, the part of the fungi that grows underground, has over 500 times the number of digestive enzymes than the human body. “There's a lot of activity that's happening. Mushrooms are secreting things to break down food, to defend themselves underground, to reproduce. And so we're essentially tapping into all of those biological processes.”

For example, for MycoTechnology’s FermentIQ line of proteins, the company uses mycelia to ferment pea and rice protein in order to improve the taste, texture, aroma of the proteins, as well as improve digestibility. “You start with a teeny little bit of mushroom mycelia. You put it on a plate, then you put it in a larger flask, and you grow and grow and grow. Then you mix the mycelia with our plant protein inputs – and this is where the fermentation process happens,” explains Wetstone. “We're tailoring the conditions to make it achieve a desired outcome. So, for example, we discovered a strain of mushroom that secretes molecules that act as a bitter blocker and flavor clarifier, and we use them in teeny, tiny parts per million to try to eliminate off notes such as bitterness associated with plant proteins and [alternative] sweeteners [in the case of MycoTechnology’s ClearIQ flavor ingredients].”

An ingredient Mycotechnology has in the pipeline is a sweetener made from honey truffle. According to Wetstone, the company is using precision fermentation to isolate a protein in this unique truffle that gives it a sweet taste. Some of the advantages of this new sweetener are clean label (honey truffle sweetener on the ingredient deck), a clean flavor profile, and high potency, meaning it will have a low cost of use for Mycotechnology’s customers.

Mushroom or not?

Given the growing popularity of fungi-based products, industry stakeholders have been advocating for updating the regulations for the labeling of fungi-based products. The Natural Products Association (NPA; Washington, D.C.) submitted a citizen petition to FDA, asking the agency to “amend 21 C.F.R. § 101 to incorporate the following labeling aspects, primarily based on the American Herbal Products Association (AHPA) labeling guidelines/guidance, for mushrooms and/or (2) commit to exercise enforcement discretion until the Agency provides guidance or publishes a regulation concerning a standard of identity for ingredients and supplements derived from any multicellular fungal species, along with the terms ‘mushroom,’ ‘mycelia,’ and ‘fruiting bodies,’ and their combinations and associated constituents.”

Similarly, Nammex submitted a citizen petition to FDA, asking the agency “to address the mislabeling of dietary supplements and functional foods as ‘mushroom’ or containing ‘mushrooms’ when they contain other fungal parts, and do not contain ‘mushrooms’ as claimed, or fail to disclose added grain ingredients.”

For example, Nammex argues that while FDA’s current labeling guide acknowledges the distinction between mushrooms and mycelium, it is not sufficiently clear or transparent to consumers what is in the product when companies use the term “mushroom mycelium.” Instead, the company advocates for manufacturers identifying the specific fungi the mycelium comes from, such as “shiitake mycelium” or “reishi mycelium.”

An open letter from a diverse group of stakeholders from the mushroom industry were critical of the letter. “Our collective use of ‘mushroom mycelium’ is scientifically accurate, just as the use of ‘mushroom spores’, ‘mushroom fruit bodies’ are descriptively accurate,” states the letter,” the letter states. “The word ‘mushroom’ describes the organism itself, whereas terms like ‘mycelium’ and ‘fruit body’ refer to distinct parts of the mushroom organism. This is perfectly parallel to saying ‘plant roots’, ‘plant seeds/spores’, and ‘plant flowers’. Both sets of terminologies describe the parts of the organism. To propose the elimination of the word ‘mushroom’ (again, the name of the organism), results in confusion; for example, ‘mycelium’ on its own would not distinguish mold mycelium from mushroom mycelium.”

“One thing that's quite basic is that a mushroom is comprised of the mycelia and the fruiting body,” says Wetstone. “Mycelia is actually the bulk of the mushroom. If we're talking about a button mushroom, most of that organism is the mycelia underground, and the button mushroom itself is the sporulating organism or fruiting body; that's what’s reproducing. In either case, it's all part of the mushroom organism.”

While scientifically this may be accurate, Chilton argues that in practice, when marketing a product, consumers don’t understand the distinction [between fruiting body and mycelium]. “Basically, right now there’s a lot of products in the marketplace that will just use the term mushroom to be the entire organism, and we feel that that is just incorrect,” explains Chilton. “People know what a mushroom is. When people go to the grocery store to buy mushrooms, they’re not buying mycelium, they’re buying mushrooms.”

Chilton pointed to a lot of marketing material at SupplySide West that contained imagery of mushrooms as people understand them, but weren’t necessarily made with mushrooms. He argues that this is inherently misleading. Additionally, when it comes to mycelial products, he explains that many are grown on grain substrates which are ground up with the mycelium and included in the final product without full disclosure.

“It's true, really often products made using mycelia are grown on sorghum or oats, and your end product doesn't have that much mushroom in there, and that's a 100% valid criticism,” acknowledges Wetstone. For its part, MycoTechnology only grows mycelia using liquid-state fermentation. She also agrees that it’s important to be specific about the strain of fungi a manufacturer is using. Ultimately, transparency is the best practice, and as consumers become more educated about fungi, it may pay off for manufacturers to be more nuanced about the way they label and market fungi products.

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