Pepsi won’t be rolling out Mug Root Beer with Sweetmyx 617 nationwide

Senomyx natural sweetener to move to the development phase

By Elaine Watson contact

- Last updated on GMT

CEO John Poyhonen: "We were surprised and disappointed by PepsiCo's decision"
CEO John Poyhonen: "We were surprised and disappointed by PepsiCo's decision"

Related tags: Stevia, High-fructose corn syrup, Pepsico

Senomyx is focusing on advancing a new high intensity natural sweetener claimed to more potent than Reb-A into the ‘development phase,’ says its CEO.

San Diego-based Senomyx - which uses proprietary taste receptor-based technologies to develop novel flavor ingredients - has made significant progress in its program to identify novel natural sweeteners than could rival stevia and monk fruit, CEO John Poyhonen told investors on Thursday.

"We continue to make progress in our natural high intensity, zero calorie sweetener discovery program. Our R&D team is currently focused on advancing our lead natural sweetener into the development phase. This novel sweetener from a plant source has demonstrated greater potency and a better taste profile than rebaudioside-A ​[the best-known steviol glycoside in the stevia leaf] in sensory evaluations.”

We are continuing our efforts to determine the commercial feasibility of potential fermentation scale-up routes

As to whether the sweetener could be cost-effectively manufactured on a commercial scale from the natural source (eg. leaf, fruit), as opposed to via a fermentation method (such as that employed by Cargill and Evolva to make the steviol glycosides Reb D+M), he said:

 “We have initiated preliminary safety studies and are continuing our efforts to determine the commercial feasibility of potential fermentation scale-up routes.  While the discovery and development timeline is currently uncertain, we are enthusiastic about the potential of this product candidate.  A significant number of potential partners have tasted or lead natural sweetener and the feedback has been very positive."

He added: "Pursuing new collaborative relationships for our Natural Sweet Taste Program that maximize the commercial potential of the program remains a top priority​.”   

PepsiCo will not be proceeding with a national launch of the reformulated version of Mug Root Beer containing Sweetmyx S617

As for the company’s sweet taste modifier Sweetmyx S617, which is claimed to enable significant reductions of both high fructose corn syrup (HFCS) and beet/cane sugar (sucrose) in a variety of applications, the news was mixed, he said:

MugRootBeer

“On October 25, 2016, PepsiCo informed Senomyx that it will not be proceeding with a national launch of the reformulated version of Mug Root Beer containing Sweetmyx S617.  However, PepsiCo will continue to sell the reformulated version of Manzanita Sol ​containing Sweetmyx S617 throughout the United States."

We were surprised and disappointed by PepsiCo's decision 

He said: "We were surprised and disappointed by PepsiCo's decision regarding Mug Root Beer. We had fully expected the reformulated version of Mug would be launched nationally in the United States during 2016 based in large part on the test market results.

"The reformulated lower calorie version of Mug Root Beer performed well in both test markets."

Asked by analysts on the earnings call why he thought Pepsi had therefore not decided to pursue the rollout, he said: "We can't speak for PepsiCo, but ... a factor referenced by PepsiCo was their new pledge, which states that at least two-thirds of their beverages will contain 100 calories or less per 12 ounce serving by the year 2025. The reformulated version of Mug Root Beer does not meet the standard, and we believe this play a role in their decision."

We continue to pursue new products to expand the non-alcoholic beverage market opportunity

He added that under an revised agreement, PepsiCo no longer has exclusive rights to use selected Senomyx products in non-alcoholic beverages: "We think the ability to share our preparatory flavored ingredients and natural sweeteners with other companies, will not only contribute to revenue growth, but also has the potential to play key role in a addressing [ph] global health initiatives in a larger scale.

"In addition, we continue to pursue new products to expand the non-alcoholic beverage market opportunity. We have advanced our next generation sweet taste booster, Sweetmyx FS22, into the final development stage activities based on the clean results from our initial safety studies with a goal of submitting our application for US regulatory approval in the second half of 2017.”

Senomyx posted a net loss of $2.46m on revenues of $6m in the quarter ended September 30, 2016, but has cash reserves of $15.7m and no debt.   

Related topics: Soft Drinks & Water

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