TOKYO -- Japanese beverage and pharmaceuticals group Kirin Holdings will spend roughly 7 billion yen ($66.8 million) in Thailand to produce sugars that increasingly are added to infant formula to mimic the components of mother's milk.
The group has developed technology to mass-produce human milk oligosaccharides, or HMOs, which are found naturally in breast milk and offer benefits including to the immune system.
Subsidiary Kyowa Hakko Bio looks to bring a new building with an annual capacity of roughly 300 tons online in summer 2022, expanding its workforce in Thailand. The company will supply HMOs to makers of baby formula, seeing growing demand in China and Southeast Asia, areas with a high number of newborns.
The oligosaccharides make up about 10% of nutrient components in human breast milk, excluding water.
Kyowa Hakko Bio has the microorganisms most fit for making the oligosaccharides and owns patents for fermentation, purification and other technologies tied to mass production.
Kirin will consider expanding beyond the baby formula space to offer foods and beverages containing HMOs as well, taking advantage of the health benefits.
International baby formula companies are adding oligosaccharides to some of their products, though no Japanese maker has done so yet. Kyowa Hakko Bio sees the global HMO market soaring to $1.72 billion by 2030 from around $143 million at present.
Global players in this field include Germany's BASF as well as Dutch chemicals producer DSM, which has acquired Danish HMO startup Glycom.