OC Doctor Aims to Build Business by Selling Consumers on Soy
To combat the effects of osteoporosis or heart disease, you’d expect a doctor to give patients the latest prescription drug. Not Ari Babaknia.
Instead, this doctor forks over a plate of cookies, and sums up his prescription this way: “We need soy now.”
Babaknia,Dr. B to his friends and patients,is chairman of Irvine-based DrSoy, a maker of cereals, cookies, nuts and trail mix with soy as the central ingredient. He hopes to bring soy-based foods into the diets of mainstream Americans. These foods, Babaknia hopes, will help raise the awareness of health foods and nutrition,and encourage better eating habits.
“Nothing has the effect on the body like soy,” he said.
Babaknia is just as bullish on DrSoy. Within three years, he hopes the start-up company can generate $150 million in annual sales, first through health food stores, and later, by way of supermarkets and discount stores.
Starting this week, 15 distributors serving 6,000 health food stores nationwide are set to begin handling DrSoy products, said Robert George, product placement coordinator for the company, which hopes to click with consumers looking to eat more healthy foods.
Overcoming Negative Image
Trouble is, “soy” and “health foods” often conjure up negative images in the minds of many Americans. Soy is linked with tofu and health bars, which people associate with a massive list of unpleasant adjectives. Babaknia said he realizes as much.
“We are promoting our products as a lifestyle,not as a diet or a drug,” he said. “Since these foods are to be consumed daily, they must have great taste.”
Babaknia’s passion for soy comes from his years as an obstetrician and gynecologist. As his patients reached menopause, more than 85% of them refused to take estrogens, which help control menopausal symptoms and prevent osteoporosis.
“Women perceived problems with estrogens, such as believing that estrogens caused breast cancer and weight gain. In fact, both of those statements are false,” said the 53-year-old doctor.
What troubled Babaknia was that while his patients would trust him on some of the most personal aspects of their lives, they refused to heed his advice on estrogens.
So Babaknia set out on a quest to find an alternative to estrogens. He quit his Costa Mesa practice in 1996 and spent two years researching natural sources of estrogens. His work kept leading him back to soy.
Soy mimics estrogen by way of micro-nutrients called isoflavones that reside within soy. These isoflavones, also known as phyto-estrogens, are anti-cancer compounds that prevent the proliferation of malignant cells. Soy also has been shown to help combat osteoporosis, cholesterol, kidney disease and prostate and colon cancer. So what started off as an interest in women’s health quickly broadened into a larger health issue, Babaknia said.
“I believe in the power of soy to help all Americans,” he said.
His belief is so strong that Babaknia has sunk everything but his house into DrSoy.
Shelf Space A Key
Babaknia, the company’s chairman, has enlisted the help of Jerrold Pellizzon, former chief financial officer of Irvine-based Met-Rx USA Inc., who serves as DrSoy’s chief executive. He’s also recruited John Weber, former vice president of Wild Oats Markets Inc., as DrSoy’s senior vice president of operations.
But beyond selling consumers on soy, Babaknia faces other challenges.
The first barrier is breaking into major shopping outlets, such as Ralphs and Wal-Mart. While access to store shelves is key to DrSoy’s long-term growth, it also would bring the young company into competition with the likes of Procter & Gamble Co. and General Mills Inc.
Another obstacle is the medical industry. Babaknia must convince other doctors that “natural” foods like soy have a place alongside more scientific remedies. While Babaknia asserts the benefits of soy are rooted in science, he faces skeptics among his own ranks.
Yet Babaknia said he and his team are determined. They have a new generation of products on the drawing board, including one that they hope to challenge the $3 billion a year estrogen industry.
“I see myself as an ambassador for soy, not just DrSoy,” Babaknia said. “I have a great opportunity and responsibility, to change the diet of Americans.”
If all goes according to plan, DrSoy intends to expand globally and expand online. The company already sells products on its DrSoy.com site. n
