In early 2022, the temporary closure of an infant formula production facility caused one of the most important food ABSENCES in our country's modern history, leaving half of the US without a single food for their babies.

For parents who cannot or choose not to breastfeed—a group that describes 80% of American families in the first year of a baby's life—infant formula is the only other suitable whole food for babies. It fully preserves life when the baby's critical systems are developing: immunity, intestines, brain, digestion and metabolism. No parent should have to experience the fear and pain of driving from state to state to find the empty shelves of their baby's only food source. And yet, the formula of the country supply chain is vulnerable to such a catastrophic disruption because of our reliance on so few infant formula manufacturers and innovators.

We cannot accept the inertia that has characterized this industry for the past half century. We are in the most exciting era of nutrition science and breast milk research – the understanding of breast milk has advanced significantly in recent years, with advances at the academic level. However, very few companies have the motivation and ability to translate new advances into better baby health products.

The shelf illusion

Picture this: you're standing in front of a crowded shelf in the formula row of a grocery — colorful cans shouting benefits are seemingly endless. You would assume that dozens of companies around the country are making these formulas, right? Wrong – it's an illusion.

I want to let you in on a little industry secret: 90% of the formulas produced in this country come from the same two companies that have easily dominated the market – being virtually uncontested – for decades, plus a single manufacturer by contract. Until ByHeart, every new brand of infant formula that had come on the market in the last 15 years had used a contract manufacturer, which makes formula for brands that use the same off-the-shelf recipe it has been using for years— a common manufacturing practice called white labeling. Because this manufacturer makes only minimal changes to an existing recipe (such as swapping out standard ingredients for organic versions), they can skip the step of conducting a new clinical trial for FDA registration and quickly bring the premium-priced brand to the market. market, using a recipe that closely mirrors much of what's already on the shelves.

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Who doesn't love a shortcut?

The reason for this stagnation is that creating a new and advanced product is long, risky and expensive. Infant formula is the world's most regulated food, as it should be – but newcomers to the industry are systematically disincentivized from innovation, with friction occurring at multiple touchpoints (such as the significant investment needed to build new factories). Parents and babies are paying the price. It's no wonder these industry giants have gone unchallenged for so long—the road to true innovation is daunting.

What should be done?

Option A: Build a new infant formula from scratch. Time on the market: 7-10 years

True innovation of a new infant formula to make it better for babies requires a ground-up approach to scientific research, global ingredient sourcing, innovative product development, clinical testing, state-of-the-art manufacturing and distribution construction, and a distribution of wide. FDA registration process—this takes years and significant financial investment before commercialization.

Option B: Launch a new brand with a white label formula. Time on the market: 1 year

To get started, contact the country's only contract manufacturer. Skip product development and name an existing one product, outsource manufacturing, skip clinical trials, create a logo and a new marketing angle, and you're in business.

It is not surprising that so few companies have joined us in choosing Option A. Investors have asked us whether parents Actually do the research and understand the difference between the options and the answer is an unequivocal yes – we see it with our clients every day.

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How do we fix this?

Relaxing regulations or shortening the infant formula development process is not the answer. In order to see a truly diverse formula aisle with better options for parents, we need to incentivize companies to prioritize innovation and infrastructure.

Here's how:

1. Raise the bar on claims and demand clear package labeling. Benefit claims should only be allowed for marketing use when a company has conducted a clinical trial that has produced tangible evidence. Setting stricter parameters for the use of claims, along with improved label transparency, will encourage companies to invest in product innovation, as parents can easily identify the difference between options.

2. Protection of generic store brand products creating a clearer regulatory path to bring affordable infant formulas to market quickly. Lower-cost store-brand generics play a crucial role in providing access to households across the country, and increased competition ultimately puts pressure on market leaders to innovate and promote product differentiation.

3. Creation of a financial incentive program for the construction of additional local production facilities. As long as the number of FDA-registered facilities remains static, the country will continue to face the threat of another shortage. Infrastructure development requires significant financial investment and without clear avenues to secure funding, lack of supply chain diversification will remain a serious risk. distresses.

The industry needs to recognize the importance of formula as a staple food for babies at a key stage of development. It's time to incentivize companies to do the hard work needed to diversify our supply chain and drive scientific breakthroughs. If we don't, we're just waiting for the next facility closure to put us back in the doldrums. Our babies deserve better than this.