Thanks to the still soft economy and sharp scrutiny from regulators, the year past proved another challenging one for nutrition companies looking to grow. However, NBJ's award winners took courageous steps down the road less traveled in 2010, and it led them straight toward double-digit, even triple-digit, growth.

Nutra Bridge, Small Company Winner

Scott Steil, president of Nutra Bridge, describes his business like this: “We help nutrition companies improve their pedigree.” Nutra Bridge operates as an outsourced sales and marketing firm, representing only branded, patented, scientifically proven ingredients. No commodities or generics, please. The requirements are stiff enough that Steil carries only six products right now, and that's just the way he wants it.

His Shoreview, Minnesota-based company saw an estimated 100% growth in 2010 on product revenues in the $5-$10 million range. One reason? Steil's portfolio tends toward blockbusters, such as 7-Keto, a proven leader in the weight-loss category, and InSea², the first dual-action starch- and sugar-blocker for blood-sugar management.

Steil believes that the company's commitment to bringing next-generation, science-based supplements to market is a core aspect of its success. “It just makes long-term business sense, and it's what we want to do,” says Steil. “I don't want to be part of a two-year fad and then disappear.”

Steil does admit that this can be a difficult road for client companies to take. “It's not easy to do this,” he says. “There are companies out there that do the exact opposite of what we do, and spend all their money on marketing. It has been our focus as an ingredient supplier to give manufacturers good clay from which they can mold solid claims and deliver efficacy in lines with those claims.”

This can be an expensive proposition, involving clinical trials and use patents — not just process patents, which Steil believes are too easy to copy. He estimates costs of $2 million just to get the core data set in hand. Steil does work with companies that have novel ingredients but not the clinical science, as long as a commitment to get that science is clear.

Both clients and customers find working with Nutra Bridge to be well worth the investment for the company's industry knowledge and expertise. “Scott has a strong sensibility to understand the deep scientific content,” says Patrice Dionne, CEO of Quebec's InnoVactiv, a leader in nutraceutical and cosmetic ingredients. “He can transfer that knowledge into an effective commercial message that customers understand.”

On the customer side, Carl Pradelli, president of Nature's City, a Florida-based supplement manufacturer, believes that Nutra Bridge helps pre-qualify suppliers and maximize efficiency. “Scott does a lot of filtering for us,” says Pradelli. “I know that when Scott brings us an ingredient, the company behind it is well capitalized, has invested in research, and has all the characteristics we demand.”

Finding suppliers with that level of commitment in a noisy, competitive marketplace is tough. “Lots of companies are more conservative now,” says Steil. “Compared to five years ago, we talk to three times as many companies to find one that fits our profile.”

Despite the challenges, Steil remains bullish on the market potential for science-backed supplements. “This is not the quickest strategy to growth,” he says, “but it's one that makes the most long-term success. I really believe it's the right thing to do from an ethical perspective.”

Aker BioMarine, Mid-Size Company Winner

Stretch-mark growth would be an apt description of the success that Aker BioMarine, a krill oil supplier based in Oslo, Norway, experienced last year. With an estimated 300% growth and sales topping $15 million, Aker finds itself on one exhilarating ride.

Krill enjoys one of the most enviable sales profiles in the industry, with few suppliers plying the waters and high barriers to entry. Furthermore, Aker has solid backing in this capital-intensive category, following a September 2010 announcement of a joint venture with U.S. private-equity firm Lindsay Goldberg and its $10 billion in managed assets. The 50-50 arrangement was formalized through the establishment of Trygg Pharma, which then went on to acquire EPAX and its fish oil operations.

These partnerships indicate an aggressive commitment to the omega-3 category, according to Tom Aarts, principal of Nutrition Capital Network. “This joint venture is synergistic. EPAX is fish oil and Aker is krill, and they are both trying to own their categories.” Aker has the traction right now, according to Aarts, since krill is such a high-profile ingredient in the mass market. “Aker is well-financed and has control from sea to shelf,” says Aarts.

Financial support aside, Aker has a single-minded commitment to the krill category that gives it unique positioning in the segment. The company is the only krill ingredient marketer with a model based on a sustainable and consistent supply chain.

This starts in the Antarctic, where all fishing vessels must obtain a license from the Commission for the Conservation of Antarctic Marine Living Resources. Aker took this requirement one step further. Rather than hauling the catch to the surface, Aker's proprietary system pumps live krill on board, where the intended catch species, Euphausia superba, is then verified. The processing techniques reduce unwanted by-catch and reduce the ecological footprint of each harvest. After freeze-drying the krill into powder form for transportation to Europe, each lot is labeled with the exact latitude and longitude of its origin, providing full traceability. For these efforts, Aker is the only krill harvester with certification from the Marine Stewardship Council in recognition of its efficient and sustainable catch.

This commitment to the supply chain contributes meaningfully to the company's ongoing success, according to Todd Norton, vice president of business development who joined Aker in September as the company established a sales and marketing presence in the United States. “We are able to supply all of the demand that comes to us,” says Norton, “by virtue of the fact that we own the shipping fleet and control harvesting. We have a tremendous team that manages logistics to keep up with this demand. We are also fortunate to have a business partner doing well in the mass channel and creating lots of visibility for the krill product to drive that demand.”

Aker understands that ongoing research and education efforts are required to further build the category. “It's our job to build awareness for krill and our Superba brand, to really establish what they mean,” Norton says. To that end, Aker commits one full week aboard its fishing vessel, Sea Saga, to independent research concerning the impact of harvesting to the krill biomass.

Aker recently joined the Global Organization for EPA and DHA Omega-3, in part to establish a krill monograph. “It is important for industry and consumers to look at the compositional differences between various krill oil offerings,” says Norton. “If someone wants to take elements and do a blend, that's fine, but it needs to be called a blend and not pure krill. We want to define a recognized monograph for pure krill oil.”

NBTY, Large Company Winner

It's no fluke that NBTY is the largest player in the U.S. dietary supplement industry. With 22 manufacturing and warehousing facilities in the United States and a keen focus on improving the supply chain in the European Union, NBTY seems well positioned to remain on top. The behemoth behind such brands as Vitamin World, Puritan's Pride, Solgar, Nature's Bounty, Rexall and MET-Rx, NBTY saw 18% growth in 2009 on sales of $2.58 billion. With continued double-digit growth in the first nine months of 2010, the company is poised for another banner year.

NBTY certainly capitalized last year on organic growth opportunities in private label and mass market, but management continues to drive growth through acquisition, especially in poorer retail climates, such as the United Kingdom. And who can forget that momentous day in July when NBTY stunned the industry with news of its $3.8 billion acquisition by the Carlyle Group, a private-equity firm based in Washington, DC with $98 billion in assets under management. That deal closed in October 2010 with a final price tag of $4 billion, in what figures to be the largest transaction of the year to take a public company private.

But NBTY's long-standing success is driven by a solid operational foundation that gives the company footing across all of the major sales channels and manufacturing capabilities beyond compare. The company currently produces roughly 90 billion tablets and capsules annually. NBTY employs 475 people in quality control alone to adhere to various standards and certifications, including cGMPs, HAACP, USP, NPA and Kosher. The company is also a leader in softgel technology, designing its own machinery when existing technology won't fit the bill.

It all comes to down to being a good supplier, according to President and CFO Harvey Kamil, who says the company is delighted and honored to receive this award. “We have such a large manufacturing presence,” says Kamil. “That allows us to be a good supplier to our customers.” And a reliable one.

“Retailers are looking for consistency in both quality and delivery,” says Kamil. “We manufacture 25,000 SKUs and still maintain 100% fulfillment. That means a full order to every customer, and that's important.” The company maintains sufficient redundancy in manufacturing to guarantee product delivery even when there's a natural crisis, such as an earthquake or hurricane.

Scott Van Winkle, managing director at Canaccord Genuity, sees competition intensifying in both contract manufacturing and private label, which will lead to pressure on pricing and branded business. But NBTY has an advantage when it comes to costs. “Scale is so important,” says Van Winkle. “It's about volume. The more you buy on the ingredient side, the more power you have over pricing.”