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Cyanotech courts consumers
By staff reporter

2/1/2006 - Hawaiian microalgae producer Cyanotech has become the latest company to tout its wares direct to consumers, with the initiation of an advertising campaign aimed at end users of BioAstin.

Traditionally ingredients suppliers conducted their marketing in the business-to-business sphere, looking only so far as attracting new industry clients. But in the last two years many have started supporting their clients with awareness-raising efforts of their own; naturally, demand for the finished product filters down to demand for the ingredient.

For some this has involved developing a consumer-oriented website with an accessible explanation of the science, whilst others have developed their own brand and logo to sit alongside that of the finished product on the packaging.

Cyanotech's approach is to retain the services of Minnesota-based Media Relations for a campaign promoting BioAstin to run across consumer print and broadcast media.

BioAstin is used in products from a number of well-known supplement makers, including Now Foods, Health Plus, Twin Laboratories, Jarrow Formulas and Pure Encapsulations.

Bob Capelli, Cyanotech's VP of sales, said: “This represents a major initiative by Cyanotech to support our customers' marketing of BioAstin. It comes at an opportune time as consumer awareness of natural astaxanthin for such health benefits as fighting inflammation is increasing steadily.

There are no FDA-approved health claims relating to astaxanthin, but Cyanotech holds three usage patents, for carpal tunnel syndrome, for cold and canker sores, and as an internal and topical sunblock to prevent skin damage from UV radiation.

A number of other uses for the carotenoid have also been identified: Valensa holds both US and world patents for its use in retarding and ameliorating central nervous system and eye damage, and Fuji has world patents for its use in physical and muscle endurance, gastric health, fertility and for the immune system disorder Crohn's disease.

Fuji also has a patent pending for eye fatigue and visual acuity.

Cyanotech has identified great opportunities for its astaxanthin in Asia – it is thought that its sales in Japan could double this year.

But the US market is also important, since around 50 percent of the company's overall sales are to clients in the US.

In full fiscal 2005 it reported net sales of $11.45 million. Net income increased 200 percent on the previous year to $399,000, however income from operations dropped 23 percent to $562,000.

This was attributed largely to issues with the Japanese acquaculture market, an increase in R&D expenses and decreased gross profit.


Bruce Russell: [email protected]
(310) 559-4955 x101


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