Sweet Dreams : Taste for Sugar Substitutes Grows, Heats Up Market

Government approval of a third non-caloric sugar substitute hardly ushers in the era of “the two-calorie hot-fudge sundae,” as one analyst put it. But it does offer a preview of the growing competition for the shopping dollars of the 78 million Americans who regularly eat low-calorie foods.

After nearly six years of deliberation, the Food and Drug Administration last week granted the West German-owned maker of acesulfame-potasium permission to market the compound in dry form for use in such products as powdered drinks, table-top sweeteners, puddings and chewing gum.

The company, Hoechst Celanese, said it will soon apply to use its compound in liquids and baked goods. The FDA is still pondering its use in candy.

The new sweetener, to be sold under the brand name Sunette, joins only two other sugar substitutes on the billion-dollar U.S. market for artificial sweeteners: saccharin, the no-calorie pioneer that first appeared in 1902, and the current market-leader aspartame, a virtually no-calorie compound now made by Monsanto under the brand name NutraSweet.

Taste Is the Key

But the FDA is considering applications for approval of a number of other dietary compounds, and new and broader approvals are expected in the next few years.

Johnson & Johnson’s McNeil Specialty Products subsidiary and Pfizer Inc. both have filed versions with the FDA. And Abbott Laboratories has asked that its once-popular cyclamate, which the FDA removed from the market in 1970 for health concerns, be given a fresh look. (Cyclamate continues to be used in foods and beverages made and sold abroad.)

“What we’re entering now is the day of the non-nutritive sweetener,” said Emanuel Goldman, who follows foods and beverages for Paine Webber. “This is going to be a really competitive market. The NutraSweet people are well aware of that, which is why they went to the trouble to establish a brand from the start.”

The Calorie Control Council in Atlanta, an international trade association representing the dietary food industry, estimates that more than half of the 78 million U.S. consumers who say they regularly consume reduced-calorie foods and beverages are demanding more of these products. That market, now worth up to $12 billion in retail sales, is a cinch to grow since most diet-conscious Americans are in the fast-growing 35-to-49 age category.

“The object of the non-caloric industry is to let you make a hot fudge sundae with two calories,” Goldman joked. “That’s the goal!”

But the analyst added that Sunette’s success will depend very much on how consumers respond to its taste. “It had better be as good as NutraSweet or it’s not going to make it,” he said. “When it comes to taste, every body’s a genius, and if there are small differences, consumers will notice them.”

The manufacturer, Hoechst Celanese, a wholly owned subsidiary of Hoechst AG of Frankfurt, West Germany, described Sunette as a white, odorless, crystalline product 200 times sweeter than sugar. “It has a clean, quickly perceptible, sweet taste that does not linger,” said Donna S. Kaufman, spokeswoman for the subsidiary in Somerville, N.J. In the 20 other countries where it is already in use, the substance is spelled “Sunett.”

Won New Approval

The substance shares with saccharin the ability to pass through the body without being metabolized, Kaufman said. “What comes in, goes out.” Aspartame/NutraSweet does metabolize, leaving behind a calorie or two.

Moreover, Sunette remains stable or unchanged in solids and liquids and when heated to 400 degrees Fahrenheit. So far, only saccharin among artificial sweeteners is found in some baked goods, but always as a calorie reducer combined with natural sweeteners, said Gordon McCullough, general manager of PMC Specialty Groups, Cincinnati, the only U.S. manufacturer of the compound.

“That’s still a wide-open product category,” said Keith Keeney, a spokesman for the Calorie Control Council.

Sunette won’t be alone in going after that untapped field. NutraSweet, which disintegrates at baking temperatures, has an encapsulated or “bakeable” form awaiting FDA approval, said Joe Stroop, spokesman for NutraSweet Co. of Deerfield, Ill. (The heat shield melts away after cooking to leave the sweetener in the finished product.) Aspartame/NutraSweet in June won FDA approval of additional uses--in yogurt preparations, refrigerated flavored milk beverages, frozen desserts, refrigerated ready-to-serve gelatin desserts and ready-to-serve fruit juice beverages, even fruit-flavored wine coolers.

At the outset its new competitor, Sunette, will be available only as a sweetener in powdered products. Spokeswoman Kaufman said the company already is talking to food manufacturers. Major users include giant General Foods, H. J. Heinz (which makes the Weight Watchers line of dietary foods) and the beverage industry led by Coca-Cola (which already uses Sunett, mixed with aspartame in France’s Coca-Cola Litez).

In addition, Hershey Foods would love to find a sugar substitute that can work with chocolate. “We’d like to be (a user), but we haven’t found any artificial sweetener that can be used with chocolate,” spokesman Carl Andrews said.

U.S. consumers will likely not encounter Sunette before next year, Kaufman said. Until production can be started in this country, Hoechst Celanese will import the substance from its parent Hoechst AG.

One initial advantage the company may have in marketing Sunette is that it will be the only sugar substitute not required to carry a health warning on the label.

Must Include Caution

After having banned cyclamate in the late 1960s, after several tests indicated a possible connection between its consumption and bladder tumors that formed on laboratory rats, the FDA in 1977 attempted to repeat its pullback with saccharin, then celebrating its 75th year as the diabetic’s sweetheart. The proposed ban ran into a huge public outcry, sufficient to move Congress to set it aside while imposing the present warning label on the product, now mainly used in such table-top sweeteners as best-selling Sweet ‘n Low.

The FDA approved aspartame in 1981 for use in dry foods but has since approved its use in other foods and liquids, including soft drinks, which now make up 70% of the market for substitute sugars. But products containing the chemical must caution persons with the rare genetic disease phenylketonuria, since it is thought to cause brain damage to victims of that disease.

Monsanto’s NutraSweet subsidiary will continue to enjoy patent protection covering aspartame production in the United States until 1992, when competitors will be able to move in, likely leading to a sharp cut in its cost. In Canada, where patent protection already expired, NutraSweet costs about $30 a pound, compared to $60 in this country. And McCullough remains optimistic that saccharin’s carcinogenic cloud will be lifted when the current congressional moratorium expires that same year.

With three other sweeteners awaiting FDA judgment, the 1990s could prove to be the era of Goldman’s sweet dream, the two-calorie sundae. Under current trends, the market will be considerably broader by then.

“I think it’s just starting to be tapped,” Keeney of the Calorie Control Council said of the dietary food market. Diet consciousness first took off during the Kennedy-era fitness craze of the early 1960s, dropped off after the saccharin and cyclamate scares, then began to grow again after the FDA approved aspartame.

“Reduced-calorie foods are not used just for weight loss any more,” Keeney said. “It’s also just a life style thing--to avoid unnecessary calories.”

Or as Goldman put it: “You can have your cake and eat it, too--without calories.”