Before Somnaceutics Ltd., the original developer of a milk-based sleep enhancer, carried out clinical trials in 2007, its founding scientists looked at a whole group of milk peptides and their bioactive properties.
"We didn't initially set out to identify a sleep product," says Guy Wills, former chief executive of Somnaceutics, the original commercialising entity, which late last year was acquired by health and wellness products manufacturer New Image Group. "The sleep product was a consequence of work we did when we found that if we carried out an enrichment process, the product had a calming effect."
This was validated by clinical and market trials, and the decision was made to scale up production.
"The beauty of the product and process is that it is natural, and no more demanding than established milk pasteurisation," he says. "It was something we could introduce into standard dairy processing environments."
About 10-12% of the national dairy herd has the desired sleep-inducing peptide, and the company has created sub-herd farmer partners to supply the raw material.
"The way the product is processed along with the additives, accelerates a natural process that enhances its protein profile," Wills says.
Its intellectual property (and patents) is around the special milk and the processing, which "is very difficult to copy," he says.
He strongly advises any other entrepreneurs looking at the pharmaceutical/nutriceutical market to develop from a 'investment ready' point of view.
NZTE has an extremely useful 'Investment Ready Guide' says Wills, much of it about thinking about the end game before people even start.
"If you do that thinking pre-concept, before you start your research, you're much better off," he
"You're much better doing it then rather than going too far down the track."
The New Image Group is also very open to engaging with others on any research on bioactive products, "early on, before you slip up," he says.
"That way you'll be able to hit the ground running, and be able to market through our channels.
"At the end of the day, I believe we need to think of New Zealand as one team and look to be in a premium, differentiated space that provides a sustainable competitive advantage," he says. "Then we can move up the value chain and get our fair share from what we do best."