Bevscape Innovation

FDA Rejects Petition to Change Name of High Fructose Corn Syrup

Corn refiners suffered a defeat in May as the U.S. Food and Drug Administration (FDA) rejected an industry petition to rename high-fructose corn syrup as “corn sugar” on nutritional labels.

The Corn Refiners Association (CRA), which includes major corn refiners such as Archer Daniels Midland and Cargill, sought the name change in a 2010 petition to the FDA as part of an effort to reverse years of controversy and negative publicity about the health effects of the sweetener.  However, the FDA ultimately decided that “corn sugar” does not “accurately identify or describe the basic nature of the food or its characterizing properties” and that the name change could “pose a public health concern.”

In its petition, the CRA argued that high-fructose corn syrup – a sweetener that has been widely used in processed foods and beverages since the 1970s – is a form of sugar with the same nutritional value as the everyday white sugar that most consumers are familiar with. Along with the petition, the CRA has been running a multi-million dollar marketing and public relations campaign using the term “corn sugar” in an attempt to improve the image of high-fructose corn syrup.

However, the FDA, which reviewed the CRA’s petition for nearly 20 months, stated that consumers would be confused if high fructose corn syrup was to be renamed “corn sugar,” particularly as the agency defines sugar as “a solid, dried and crystallized food,” and describes syrup as a “liquid food.” The FDA called its approach “consistent with the common understanding of sugar and syrup as referenced in a dictionary.” The FDA also noted that “corn sugar” is already a term used for a solid corn sweetener called dextrose and that a name change for high-fructose corn syrup could mislead and affect individuals with fructose intolerance.

The ruling was met with approval from the Sugar Association, which has been highly critical of the name change effort and filed a lawsuit against the CRA last year claiming that its public relations and marketing campaign is misleading to consumers.

“The FDA’s ruling represents a victory for American consumers,” said Dan Callister, an attorney working with the Sugar Association. “It reaffirms what most consumer advocates, health experts and policy officials have been saying all along: only sugar is sugar. HFCS is not sugar. The next step is for the federal court to end the CRA’s misleading propaganda campaign.”

In a brief statement issued following the ruling, the CRA said that the ruling was decided on “narrow, technical grounds” and did not “address or question the overwhelming scientific evidence that high fructose corn syrup is a form of sugar and is nutritionally the same as other sugars.”

PepsiCo Assembling New Innovation Team

PepsiCo has tipped its hand on its innovation plans, advertising for a position on a still-forming team designed to work with emerging beverages out of its Naked Juice offices near Los Angeles.

The Beverage Growth Ventures team would create a Pepsi-owned, California-based rival to Coca-Cola’s older Venturing and Emerging Brands (VEB) group, which runs out of Atlanta. It would also signal the first cohesive step by PepsiCo to create a business entity focused solely on incubating a portfolio of disruptive emerging brands.

The Beverage Growth Ventures team will be led by Chris Lansing, the General Manager of its Naked Juice and Izze division, BevNET has learned. Naked/Izze operates as a separate, West Coast entity, although it is owned by PepsiCo.

The hard-wiring of the project began to move forward under new Pepsi Americas Beverages CEO Al Carey, who took over for Massimo d’Amore in September. Naked had been suggested previously as a potential focus for new beverage innovation by d’Amore, who retired earlier.

While it is clear that the Beverage Growth Ventures group is expected to create or assemble a new portfolio of emerging brands, for now its current holdings seems to encompass Naked’s current lineup:  Naked Juice, Naked Coconut water and Izze, although that portfolio “will expand to include new brands and categories,” according to the recently posted job description, which is for a VP of Go-To-Market.

Conspicuously absent from that portfolio is O.N.E. coconut water, another product that is frequently pointed to as an example of Pepsi’s willingness to help grow emerging brands. PepsiCo owns a controlling interest of O.N.E. coconut water as well, although that company currently functions independently.

It is not yet clear if the new entity will focus on growing its portfolio through partnership with existing brands or new brand development.  But what is clear is that Pepsi and its Naked subsidiary have been surveying the market carefully as they began to move forward with a concrete plan for a venture-oriented entity.

Over the past few months, Lansing and other members of PepsiCo’s senior beverage leadership team  have met with a number of entrepreneurial beverage companies — as well as potential distribution and financing partners. The company has also begun creating a leadership structure and a 40-plus person team that encompasses supply chain, sales and marketing and other key functions.

In addition to small beverage companies, executives have also met with potential route-to-market partners as well as investment advisors as they attempt to formulate a cohesive strategy for investing, growing, and distributing those brands. PepsiCo has shown a willingness to work with third parties in the past, as it bought into O.N.E. at the same time as an investor group headed by Catterton Partners.

With the exception of O.N.E., in recent years the Pepsi organization has preferred to partner with growing beverage brands on a distribution basis only, taking products like FRS, Muscle Milk and Rockstar Energy Drinks onto its trucks. But that lack of willingness to write a check now seems to be changing.

For a short time Pepsi Bottling Group ran an incubation unit of its own, Learning Labs, that centered largely around testing the distribution of emerging coconut water brand O.N.E. in specific geographic areas, but since the takeover of PBG by its parent company two years ago that project has been much quieter. O.N.E. itself has been in a period of transition, with co-founders Rodrigo and Emilie Frits Veloso leaving the day-to-day operation and moving to Florida in March.

WILD Flavors Launches Global R&I Team

Coke and Pepsi aren’t the only companies looking at developing innovations that might be able to be deployed on a global basis. Supply company WILD Flavors GmbH announced in June that it has created a Global Research and Innovation Group (R&I), headquartered in Zug, Switzerland. This will be a cross-functional, cross-regional team comprised of highly technical, experienced research personnel and trained chemists, focusing on delivering a continual pipeline of robust, innovative concepts to the food and beverage markets.

Through very coordinated, standardized, and amplified flavor, color, ingredient and scientific research with increased emphasis on global efficiencies, WILD will now be able to provide its customers with the best offerings, unique technologies, and creative solutions on a worldwide basis.

“By bringing together the regional strengths and expertise of WILD into a Global team, WILD will be able to expand our capabilities, capacities, creativity, and expertise in many areas, including: in-depth flavor and color research and development, plant science, health ingredient technologies, fermentation, analytical analysis, biotechnology, and natural mint varieties and custom variations, and sweetening solutions,” said Michael Ponder, Global CEO of WILD Flavors.

Dr. Erik T. Donhowe will lead the Global R&I Team as Chief Global Research and Innovation Officer. Dr. Donhowe has been with the WILD organization since April, 2004 – Vice President of the North American Beverage Business Unit, and as North American Chief Operating Officer since 2010.