Marketing and sales
BioGaia takes a new approach
BioGaia’s products are available at drug stores and pharmacies around the world. To get closer to the markets, BioGaia will open two new regional offices.
BioGaia’s products are sold and marketed by a global network of partners. Over the years the partner network has grown, but so has the need for closer collaboration with the local distributors. The partners require more support and assistance, for example in matters related to sales, marketing and research.
“Here, we have taken a new approach and will open local BioGaia offices in Miami and Singapore”, says Urban Strindlöv, Executive Vice President and Sales Director at BioGaia. The Miami office will open in 2017 and the plan in Singapore is to have an office in place by the beginning of 2018. In Latin America we are already well established, at the same time that the USA is the world’s largest market for probiotics. In view of that, the Miami office is strategically located and can serve as a base for both North and South America. In the same manner, Singapore will function as a hub in Asia, which is a market with strong growth and potential for BioGaia.
“Another advantage of these locations is that they are attractive places to work. This is important”, says Urban. “We want to attract skilled and talented people who can both convey the BioGaia “spirit’ and work independently in their regions.”
Regional offices are a whole new step for BioGaia
The offices will be focused on supporting the local markets with sales, marketing and research. The Americas and Asia are regions where BioGaia has large and important partners and several ongoing research collaborations.
“Being closer to our partners will facilitate relations and make it easier to cooperate,” says Urban. “We will be able to reduce long business trips and different time zones.”
Europe is BioGaia’s most established market
“Europe is BioGaia’s most established market, where we have the greatest geographical penetration, good coverage in many countries and longstanding partnerships in the majority of markets. Overall, Europe accounts for around 65 percent of BioGaia’s sales. Italy, Spain, France, Germany and Turkey are markets where we have a strong position today.”
Strategically important partnerships in Europe
Italy is one of the world’s largest markets for probiotics and is extremely competitive, with more than 450 different probiotic products.
“In 2016 one of BioGaia’s distributors was acquired by Recordati, which is also our distributor in Spain and Portugal, a move that has made Recordati an even more strategic partner for us,” says Urban. “In Germany, our collaboration with InfectoPharm has been deepened and we are seeing an increased focus on BioGaia by the company. Their positioning toward midwives has proven highly successful.”
“We also have a strong position in France but believe there is further growth potential, particularly for our pediatric products. Here we need to support our partner PediAct, which is a relatively small but focused company.”
Latin America going strong
In Latin America BioGaia has continued its excellent partnership with Aché in Brazil. For many years Abbott/Recalcine has been BioGaia’s partner in a number of Latin American countries, such as Chile, Peru and Colombia. In 2016 Abbott also launched BioGaia’s products in Mexico, a country with a large population and many children that has the potential o become an important BioGaia market. At the end of 2016 an agreement was signed with Abbott for Thailand, thereby expanding the partnership to outside Latin America. In total, the partnership with Abbott now covers 13 countries.
Building networks in the USA
“In the USA we have launched a long-term initiative to build a network of opinion-leaders in the pediatric area,” says Urban. “We are doing this in collaboration with one of our partners, Everidis, and is part of the strategy to strengthen our brand. We also have long-term ambitions to get more clinical studies performed in North America. Much of the preclinical work on BioGaia’s patented strains of reuteri is already being carried out in the USA.”
Several new agreements in Asia
In December 2016 BioGaia Japan signed major agreements with one of the leading confectionery and dairy companies in Japan, Nippon Kabaya Ohayo Holdings, whose subsidiary Kabaya Foods will market BioGaia’s products to consumers at drug stores, supermarkets and similar outlets. Another subsidiary, Ohayo Dairy, will use BioGaia’s probiotic strains in beverages and dairy products.
“Expectations for the collaboration with Kabaya Ohayo are high and it will be exciting to follow the developments in Japan,” says Urban.
Indonesia is one of the biggest markets for probiotics in Asia and the focus there is on treatment of diarrhea. Together with the partner Interbat, the use of BioGaia’s products is being widened to also include colic and other digestive problems.
China is a complex market in terms of the regulatory environment, with time-consuming regulatory procedures that take several years. While waiting for the desired registration there are limited opportunities to market the products, which is reflected in sales. There is currently a study underway in China on infants with colic.
“One of many bright spots in Asia is that after several years of registration work, sales have now commenced in the Philippines. Our partner Unilab has a strong position and the successful launch of the tablets will be followed by the drops later this year,” says Urban. “Hong Kong, on the other hand, is a market where we have been active for many years and which has the highest per capita sales of tablets in Asia. In 2016 we signed an agreement with a new partner, Biowelltech, for sales of our oral health products.”
BioGaia’s relationship with Nestlé began in 2008 and today Nestlé is BioGaia’s largest partner. The areas of collaboration are mainly related to infant formula and Growing Up Milk for children over the age of one year, where Nestlé uses bacteria culture of L. reuteri Protectis in its products. Growing Up Milk was launched in 2014 and now generates substantial revenue for BioGaia. The close collaboration between the companies also includes research and product development.
Strengthening the brand
“We have a clear and explicit ambition to strengthen our brand in the countries where the products are sold under the BioGaia brand,” says Urban. “At the moment, this work is focused on supporting a few strategic partners, including PediAct in France and Everidis in the USA.”