Sucralose supply set to expand as Tate & Lyle loses patent case
Tate & Lyle owns a host of patent rights to the process for manufacturing sucralose and accused a number of US distributors and Chinese manufacturers of using its patented processes in a case filed in April 2007. The final ruling by the six-person Commission – which follows repeated postponement – upheld the ITC judge’s preliminary decision made last September.
However, Tate & Lyle said that it intends to review the ITC’s final determination to work out whether further appeals are feasible through the US Federal Circuit Court of Appeals.
Market competition
The case is significant because it effectively opens up the market to competitors – and there are many standing by to try and break Tate & Lyle’s near monopoly of the global sucralose market.
Spokesperson for the Guangdong Food Industry Institute/L&P Food Ingredient Co. Ltd. (GDFII/L&P) Bassam Faress said: “Many potential customers have held back in ordering product until confirmation of the positive ruling by the ITC.”
He said that it was important that it was one of the few companies whose processes had been reviewed and found to be non-infringing by the ITC “as it may not be the case with other competitors now in the market.”
The company added that it is now “determined to aggressively expand” its production of sucralose in expectation of higher global demand.
Another manufacturer involved in the case, Niutang Sucralose, recently completed expansion to 300 metric tonnes, and said today: “We are poised to grow even more robustly going forward.”
JK Sucralose also announced its intention to expand sucralose capacity last month, to 300 metric tonnes next year, and 800 tonnes by 2012. The company produced 200 metric tonnes of sucralose last year.
Competitive advantage
The ruling is potentially damaging for Tate & Lyle, which says that its patent portfolio, including process, product form and blend patents is one of the key ways in which it defends its competitive advantage.
However, president of Tate & Lyle Sucralose Karl Kramer remained confident.
He said in a statement: “While this development is disappointing, intellectual property is just one of the many components which define Tate & Lyle’s formidable competitive advantage in the global sucralose business.
“Our manufacturing facilities operate at a level of cost, efficiency and environmental stewardship surpassed by none, producing sucralose which meets the highest standards of quality, purity and hygiene.
“Our business is built upon long-standing relationships with some of the world’s leading food, beverage and pharmaceutical manufacturers, as well as the established Splenda brand which is renowned as a high quality, reliable and trusted product in a number of markets.”
Globally, the high intensity sweetener market is worth $1.3bn and sucralose is the number one sweetener by value in food, with a 36 percent share. North America is the world’s largest market for high intensity sweeteners and sucralose is the leader with a 48 percent share of the market.
