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Food Science

DSM to enter human milk oligosaccharide market by acquiring Glycom

$830 million deal builds on earlier moves into nutritional ingredients

by Craig Bettenhausen
February 21, 2020

A photo of a regular size human looking adoringly at a much smaller one that is sleeping.
Credit: Shutterstock
Human milk oligosaccharides may help infant formula better mimic natural human milk.

DSM will pay $830 million to acquire Glycom, a Danish company that calls itself the world’s leading supplier of human milk oligosaccharides (HMOs). With the purchase, DSM will follow firms like BASF and DuPont into a market it expects to quadruple in the next 5 years.

HMOs are prebiotics, meaning they feed beneficial gut microbes, which many scientists and parents believe aid digestive health, neurodevelopment, and disease resistance in infants and young children (Pediatr. Gastroenterol. Hepatol. Nutr. 2019, DOI: 10.5223/pghn.2019.22.4.330). While HMOs are found in natural human milk, Glycom and others produce them via fermentation for use in infant formula and, increasingly, adult nutritional products.

For DSM, the purchase continues a pattern of buying its way into new nutritional ingredient markets. Notably, the Dutch firm paid $530 million in 2012 for the omega-3 fatty acid maker Ocean Nutrition Canada and $1.1 billion in 2011 for the fatty acid maker Martek Biosciences. Both firms’ products are used in infant formula.

Other major chemical companies also see opportunity in HMOs. BASF makes and sells the HMO 2′-fucosyllactose on a large scale and last year licensed patents from Glycosyn on adult and adolescent digestive health applications such as irritable bowel syndrome. DuPont markets 2′-fucosyllactose in the US and Europe and is partnering with the biotech firm Inbiose to commercialize other HMOs.

Inbiose says human milk contains more than 150 HMOs, though 2′-fucosyllactose makes up about 30% of a typical milk HMO profile.

By acquiring Glycom, DSM will immediately become the leader in this nutritional niche. According to DSM, the global HMO market is currently around $110 million per year and growing rapidly. Glycom reported $80 million in sales in 2019, mostly to Nestlé, which is a large investor in Glycom.

Nestlé is the world’s biggest marketer of infant formula and featured HMOs prominently in a recent presentation to investors. The firm first added HMOs to formula in 2017.

The goal of adding HMOs is to make infant formula and supplements more closely mimic human milk. Though the World Health Organization recommends babies be exclusively breastfed for the first 6 months, two-thirds of infants receive at least some formula or other supplement during that time, and many infants rely entirely on formula.



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