There was huge news today in the sports drink world. Cadbury Schweppes has purchased PacificHealth Labs. Why is this big you ask? Because Gatorade's greatest competitor from a scientific standpoint might very well be PacificHealth Labs, which produces during exercise and post-exercise workout drinks with protein in it (Accelerade and Endurox R4). While Gatorade's Sports Science Institute has always shot down ingredients put into competitive products, they've had a hard time dismissing the effectiveness of protein. Let me make this clear -- Accelerade and Endurox R4 will never have a significant chunk of the sports drink marketplace, but the drinks are threatening in that hard-core athletes have been gravitating towards it. That's got to be one of the reasons why Gatorade started producing the Endurance Formula.
So why have some of you never heard of Accelerade or Endurox R4? Because while the idea was good, the company was losing a tremendous amount of money ($17 million, according to documents filed to the SEC) that distribution into grocery stores and supermarkets was impossible. Cadbury Schweppes' controls 7-Up, Mott's, Dr. Pepper, Welch's, Hawaiian Punch and Orange Crush. "We're certainly very excited about this ($4 million) acquisition because it gives us access to patents, technology and trademarks in the growing sports drink nutrition industry," Cadbury spokesman Chris Barnes told the Asbury Park Press.
In my book, I talked extensively about Accelerade and that the fact that it wasn't going to get widely distributed (it was also only in powder form) would make it easier for Gatorade -- should protein in a workout drink prove to be a more effective solution -- to avoid putting protein in its drink. Protein is hard to flavor and would change the consistency of Gatorade. But now that Cadbury Schweppes is behind this, will this still be the case?
Said Robert Portman, CEO of PacificHealth Labs: "In spite of Accelerade's unmatched benefits for athletes, we recognized that PHLI did not have the resources and distribution clout to launch a ready-to-drink product nationally. In the $4 billion sports drink market that is growing at the rate of 10 percent per year, the ready-to-drink form accounts for almost all of the sales."