Nestlé Health Science CEO Talks Acquisition Of Vital Proteins

When Don Kerrigan, a well-versed executive previously serving as the president of Nature’s Bounty, was appointed to be the CEO of Nestlé Health Science U.S. in 2021 as a result of the acquisition of the global nutrition player, he had an ambitious vision for the business — finding more scalable opportunities in CPG sectors where the Swiss conglomerate doesn’t traditionally have a foothold.

Launched over a decade ago, Nestlé Health Science has emerged as a leading force in pioneering nutritional solutions with a diverse portfolio of brands dedicated to advancing medical nutrition and pharmaceutical therapies.

With a growing number of health-focused products available on the market driven by consumers prioritizing food as medicine, Nestlé Health Science has quickly capitalized on the trend, onboarding a handful of better-for-you grocery brands over the years, notably Dr. Andrew Abraham-founded Orgain and Vital Proteins. This portfolio expansion resonates with Kerrigan personally.

“Transitioning into Nestlé is somewhat familiar to me because I spent a good amount of my career in the consumer healthcare space working for multinational corporations like Pfizer,” Kerrigan recently told me during an exclusive sit-down interview at Vital Proteins’s Chicago headquarters. “But there’s a sense of entrepreneurship within Nestlé Health Science that’s more indicative of what I experienced at The Bountiful Company and Vital Proteins.”

Kerrigan recalled how collagen largely remained as a novelty ingredient to American consumers when Vital Proteins was first launched in 2012 by former NSSA aerospace engineer Kurt Seidensticker. Fast forward to today, collagen that makes up nearly 30% of all human protein content is a $10 billion-plus global business, and Vital Proteins accounts for a lion’s share of the market.

“Collagen is a segment with a lot of opportunities for people to engage with: it not only has orientation towards women, the influence Vital Proteins has on the rest of our portfolio in terms of design and aesthetics is also really compelling,” Kerrigan stressed.

Creating New Playbooks For The Portfolio

Vital Proteins currently offers a wide range of products from powders, snacks bars, to ready-to-drink beverages, and, to some degree, has transformed the way people incorporate this essential protein into their daily lives using clean and sustainably-sourced ingredients.

After selling its majority stake to Nestlé Health Science in 2020, the brand continued to gain traction: points of market share increased by 3.5 over the past year, while new flavors and SKUs, such as salted caramel, pumpkin spice, and Vital Protein Plus (collagen with additional benefits), were also added to its portfolio.

Kerrigan notes how Vital Proteins is a “very scalable brand” that has an enormous room for consumer acceptance and expansion. More importantly, its digital activation across social media will also create a playbook for all Nestlé Health Science’s businesses across three different verticals — dietary supplements, medical nutrition, and pharmaceuticals.

Commenting on future acquisition opportunities, Kerrigan said the company will put categories, such as greens, plant-based, supplements offering emotional support benefits, in a high priority.

“The organization has largely been built through acquisitions, and we’ll continue either finding opportunities where we don’t have strength or sectors where we aren’t necessarily reaching consumers; versus in the past, we bought for capabilities,” he said.

“A lot of what we focus on right now is integrating the businesses we have today by taking advantage of our size and scale, continuing to drive growth, but also not losing what’s so special and unique about those brands.”