Who's the sugar daddy now?
The Indian company representing the most serious challenge to Tate & Lyle's monopoly of the highly lucrative sucralose market claims it will be capable of producing 2,000t of the sweetener a year by 2011 using a process that does not infringe any of Tate & Lyle's patents.
Speaking exclusively to FIHN on the London leg of an international business trip to discuss strategic alliances for sucralose and other products, Pharmed Medicare president Sundeep Aurora said: "Because Tate & Lyle pretty much patented everything in the 1980s and 1990s, we had to find a different method, and we found a way of doing it that was simpler and safer when everyone was telling us it couldn't be done.
"However, sucralose production is still incredibly complex and we have spent an enormous amount of money on R&D in the last six years. So much, in fact, that if we hadn't got it right, it would have been utterly disastrous."
He added: "Forty patent applications later, we have come up with something that has significant cost advantages over Tate & Lyle's method, and it doesn't use phosgene.
"While this is used in the production of several ingredients in a highly controlled manner, it's deadly, and I am of the view that if something can go wrong, it will."
Pharmed was currently making several hundred kilos a month, he said. "The next step is to build the proof of engineering concept plant, which will be operational in June and capable of making 60,000kg of sucralose a year.
"If everything goes to plan, we will be producing 5,000-6,000kg a month by this summer - enough to launch a tabletop sweetener under the Solo brand."
After that, Pharmed would build a facility capable of producing 1,000t a year that should be operational by the end of 2008.
This would require the backing of a third party, Aurora said. "I am confident we will be in a position to announce a joint venture with a strategic partner of global reputation this year.
"The interest in having more than one supplier of such a strategically important product is clear to everyone.
"By 2011, I envisage that two of these plants will be operational and producing 2,000t a year."
While several Chinese firms had entered the market, they had already run into patent infringement problems, Aurora claimed.
"When you combine Tate & Lyle's and our patents, we have created a firewall for any newcomer that is going to stop any newcomer from being able to produce a legal [non-patent infringing], economically viable method of sucralose production until 2020."
He added: "Of course, you can never say never. Someone may discover something new that doesn't infringe these patents, but if they do, it will take at least five years to produce it on a commercial scale."
