Nestle Invests in U.S. Medical Food for Alzheimer's

Nestle has bought a stake in U.S. firm Accera to support the rollout of a medical food brand for Alzheimer's patients, as the world's biggest food group seeks to expand in the health and nutrition business.

Nestle Health Science, set up last year to profit from the growing overlap between food and pharmaceuticals, said on Thursday it had taken an unspecified stake in Accera, as well as a seat on its board, but declined to disclose financial details.

Accera is a privately-held company whose main brand, Axona, is already prescribed to up to 30,000 people in the United States suffering from mild to moderate Alzheimer's.

Nestle said Axona provides an alternative energy source for Alzheimer's patients, whose brains become less able to use glucose, resulting in improved memory and cognitive function, according to ongoing clinical trials.

Better known as the maker of Nescafe coffee, KitKat chocolate bars and Maggi soup, Nestle said its investment will allow the collection of more extensive clinical data on Axona.

Switzerland-based Nestle said last year it would invest about 500 million francs in a new health science institute to research nutrition over the next decade and last month opened a new clinical development unit to conduct trials.

Nestle sees medical foods as a potential big growth area as populations age at the same time as strained health care budgets put disease prevention rather than treatment in the spotlight, and is focusing on gastrointestinal, metabolic and brain health.

The nutritional and over-the-counter healthcare markets are expected to grow by 5% annually to $200 billion by 2015, according to analysts at Morningstar.

Last year, Nestle Health Science bought U.S. firm Prometheus Laboratories, which makes tests and drugs to diagnose and treat inflammatory bowel diseases, and UK-based CM&D Pharma, which makes a chewing gum to help kidney patients.