ESTEVE LABORATORIES JOINS THE FOOD INDUSTRY BY WAY OF PASCUAL GROUP
The group announces a 5-year sales forecast of 60 million Euros in diabetic food.
Rosa Salvador (La Vanguardia)
Laboratorios Esteve has joined the food industry by way of the Pascual Group. These two firms have created a joint society ―Balance Labs― to manufacture and market food products for diabetic people. With product sales to be started off by late April, the new society's initial investment has been small ―1 million Euros. However, sales of 60 million Euros in 5 years are forecast.
Esteve wanted to copy the successful business model developed in the cosmetic industry ―by way of the Puig Group with the creation of the company Isdin― and looked for a partner in the food industry "that would be similar in size and philosophy, as well as a family business, with executives having already met at forums of the Institute for Family Business", Balance Labs' CEO José Ramón Pérez said. Mr. Pérez has participated in the development of the project as Esteve's business development manager. The two firms share equal ownership and have agreed to make decisions by qualified majority ―which in practice leads to unanimity.
"The partners, rather than capital, have so far supplied the equipment required to design and launch our products, and will also take charge of marketing activities", Mr. Pérez explained. Balance Labs manufactures two lines of diabetic food products: one to be sold by Pascual in department stores under the brand name DiaBalance, and another line ―DiaBalance Expert― to be distributed by Esteve in pharmacies.
"Fourteen percent of the Spanish population ―around 5 million people― is affected by diabetes, a condition where nutrition and a healthy lifestyle are critical. Also, despite the increasing prevalence of this disease, there is still a lack of diabetes-specific products and services. Our aim is to become the brand of choice in Spain", Mr. Pérez added. "While diabetes-specific products are already available in other countries, this will be the first alliance of two firms from two different sectors to cover these two distribution channels ―pharmacies and supermarkets", he concluded.
Balance Labs product sales will be started off by the end of this month, and a website "intended to provide a services platform and healthy lifestyle training" is already available. Over the first two years, the firm will concentrate its financial efforts on the development of its brand image, and balanced accounts are expected as of 2015.
The food industry represents yet another step forward in Esteve's diversification process. Indeed, drug product sales are already down to a mere 30% of overall sales (792 million Euros in 2011).
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