Short introduction to Capsugel 2

Capsugel, a division of Pfizer

• Global Business

• 2600 Colleagues

• Over 180 billion capsules sold worldwide– market share leader

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Peapack, N.J. (HQ)

Greenwood, S.C.

Mexico City, Mexico

Bornem, Belgium

Ploërmel, France

Colmar, France

New Delhi, India

Bangkok, Thailand

Jakarta, Indonesia

Suzhou, China

Sagamihara, Japan

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Short introduction to Capsugel 3

Who is Capsugel?

Products Services Equipment

Leading provider of innovative dosage forms and

solutions to healthcare customers around the world

Short introduction to Capsugel 4

Two axes of development

• Capsugel has evolved along two major development axes:

– New materials (alternatives togelatin – Vcaps, Pullulan)

– Liquid filled hard gelatin (Licaps)and soft gelatin (SGcaps) capsules

New materials

Liquids

1998

2000

1996 2004

Understanding opportunities in today’s vegetarian-aware marketplace – 26% of the population

Vegetarian aware consumers take moresupplements than the general population: an average of 3.1 per day versus 2.4

63% report that they prefer to buy supplements that have a specific health claim

This group has a high interest in preventing and treating specific conditions with supplements

54% are brand loyal to the supplements they use and regularly purchase those same brands

Ratings of effectiveness, safety, andbelievability are important considerations in choosing supplement brands

Not all supplements available today meet their needs…

Some supplements need protection from

acid as they pass through the stomach

on the way to the intestinal tract.

Some supplements are coated with

chemicals, solvents and other unnatural

ingredients in order to protect them for

targeted release

Some supplements cause reflux or have a

bad aftertaste making it difficult to take

over time

How can a vegetarian consumer get

protection and targeted release but stay

in a plant-based product?

What are some of the products that need protection?

Probiotics Some strains need protection from premature activation in the acidic environment which can destroy the bugs

Amylase enzymes The enzyme needs protection from denaturing in the stomach, which would render it unfit for hydrolyzing glucose

Valerian Root Valerian root has a pungent odor which can be released in stomach – causing a bad aftertaste

Garlic Garlic also has a pungent taste and odor which can be released in the stomach causing a bad aftertaste

Adenosine Triphosphate ATP, the energy currency of cells, can be broken down in the stomach by phosphatase enzymes

Probiotics market is growing fast –but underdeveloped in supplement use

In 2009, P&G entered FDM and changed the game…

• Dynamic category jumps 24%* to $527 mio

• Align pulls away from Culturelle at the top

•All others grew strongly as well pulled along

by the attention*up 54% in FDM

Growth is expected to continue with new studies expanding the category into immunity and oral health

Align

What polymer do most probiotics use and how are they different?

• Most probiotics traditionally use HGC, Vcaps® capsules or Vcaps® Plus capsules

• Enteric, by definition, does not disintegrate in the first 2 hours in pH 1.2 and then fully disintegrates in pH 6.8

• DRcaps™ capsules show no disintegration in the first 30 minutes and less than 10% disintegration in the first 2 hours in pH 1.2

Representative dissolution curves.

So what’s the promise?

• To Health & Nutrition companies who market acid-sensitive products, looking for a vegetarian means of providing some protection for their product to maintain the potency their customers expect—now there is a vegetarian capsule that provides up to 30 minutes of protection against stomach acid.

– Same great low moisture capsule but without the need to add chemical or other coated protection

– Reduces the potential of disintegration and bad aftertaste.

• To the Contract Manufacturers of those products…

– For products that need some acid-protection, this reduces manufacturing time, cost and steps needed as well as the product waste typical in after-encapsulation coating processes.

What is a DRcaps™ capsule?

Description: Capsule designed to delay disintegration of a hard HPMC capsules in pH 1.2 with a qualitative composition that is similar to Capsugel Vcaps® capsules.

They are formulated with:

• HPMC (Hypromellose - Hydroxypropyl Methylcellulose)

• Gelling agent (Gellan gum)

• Water

DRcaps™ capsule properties:

These capsules present the same characteristics as Capsugel Vcaps® capsules:

• Dimensions and aspect

• Resistant to capsule cross-linking

• Excellent Machinability

• Well suited for moisture-sensitive ingredients

• Compatible with all major excipients

They differ from Vcaps capsules by their delay in release as an innovative application optimized for lower GI tract release

Properties: Acid-resistant release

Probiotics remain stable in DRcaps™ capsules

Probiotics filled in

standard gelatin were

destroyed in the gastric

fluid.

Probiotics in DRcaps

capsules passed the

gastric fluid and were still

active in the intestinal

fluid.

Consumers prefer capsules

• Consumers prefer capsules because they consider them easier to swallow and gentle on their stomach.

• Consumers want clean label performance.

• Most consumers did not perceive an aftertaste with DRcaps™ capsules when more than two-thirds perceived an aftertaste with the same ingredients in tablet form.*

• Vegetarian-aware consumers prefer their supplements from vegetarian sources. * Sensory performance panel, 2010

New opportunities for the retailer

• Now there is the “promise

of performance” for sensitive

ingredients.

• „New & Improved‟ package

claim for retail excitement

• Now there is a vegetarian

solution that better fits what

their customer is looking for.

• Now there is an opportunity

to create a family of

“protected products.”

New opportunities for manufacturing operations

• New products

• Speed to market

• While saving $ on operations

• No new capitol/outsourcing

Blending CFM Coating

• Transport

• Warehouse

• Yield Loss

• Safety risks

• Logistical Control

• Time+$$$

Bottling Shipping

Enteric Process

Eliminate

What hurts a probiotic?

Stability

Heat Moisture