Building A Nutra Brand That Stands For Quality and Transparency, with Bill Chioffi of Nammex

Episode Overview

Episode Topic: In this episode of NutraPreneur, explore the majestic world of mushroom extraction and herbal innovation with Bill Chioffi, one of the brilliant minds behind Nammex. With over three decades of experience in herbal medicine and sustainable sourcing, Bill is revolutionizing the mushroom extract industry. Join us as we explore Nammex’s journey from conception to cultivation to final extraction, unveiling the transformative narratives in the nutraceutical landscape.

Lessons You’ll Learn: In this captivating dialogue with Bill Chioffi, witness the intricate process of bringing a mushroom product to life, from its growth in the pristine forests of China to the precise extraction methods that preserve its potency. Dig into the world of fungal metabolites and how technology is harnessed to enhance the quality and authenticity of mushroom extracts. Discover the role of innovation and compliance in harmoniously coexisting in the ever-evolving landscape of nutraceuticals.

About Our Guest: Bill Chioffi, the key figure behind Nammex, brings a wealth of experience in herbal medicine and supply chain management to the table. His journey in the natural products industry has been marked by a commitment to quality, sustainability, and customer relationships. Bill’s insights into the mushroom extract industry shed light on the dynamic fusion of tradition and innovation.

Topics Covered: Here we take a deep dive into the fascinating world of mushroom extracts. Exploring the origins of Nammex and its mission to provide high-quality, sustainable mushroom products. Gain a profound understanding of the cultivation process and the importance of analyzing fungal markers like Ergosterol. Uncover the future of wellness as technology plays a pivotal role in enhancing mushroom extract offerings. Join us on this journey of innovation, sustainability, and wellness.

Join us as we explore the story behind Nammex, a brand that specializes in mushroom products and is the premier supplier of organically certified mushroom extracts.

Our Guest:The Green Visionary – Bill Chioffi from Nammex

Episode Transcript:

Bill Chioffi: All mushrooms you’ve ever eaten are hand-picked, which starts to roll up to some of the economics with mushrooms. Which, why are you paying 1099 1199, a pound for organic Shiitake mushrooms in the grocery store? Don’t forget that that mushroom is about 90% water or more. So what you’re really paying for is 90% organic water and then the rest of the mushroom substance there. But at any rate, that’s why going to a place like China that has a wealth of these mushrooms and a long history of growing them, they’ve really dialed in the growing cycles of these and have a supply where we can get them regularly.

Bethany Jolley: Welcome to NutraPreneur, the Nutra Industry Podcast. I’m your host, food scientist, and nutraceuticals consultant Bethany Jolley. Each episode will be exploring what it takes to thrive in the nutraceutical industry. From conversations with successful nutraceutical entrepreneurs to venture capitalists to tech executives whose innovations are reshaping the nutraceuticals industry, we explore the innovations and trends that are shaping the next generation of nutraceutical businesses.

Welcome back to NutraPreneur, the podcast that unveils the transformative narrative sharing the nutraceutical landscape. I’m Bethany Jolly, your host for today’s episode, and we’re about to dive into the world of herbal innovation and wellness. Joining us today is Bill Chioffi, one of the brilliant minds behind Nammex. With over three decades of experience in herbal medicine and a profound understanding of sustainable sourcing. Bill is revolutionizing the mushroom extract industry. Bill, it’s such a pleasure to have you today.

Bethany Jolley: Thanks a lot, Bethany. It’s great to be here.

Bethany Jolley: So first off, I’d like to talk about Nammex’s journey. Could you share the origin story of Nammex and how your extensive background supports Nammex as a powerhouse and mushroom products?

Bill Chioffi: Yes, certainly Nammax was first of all, as an acronym for North American Medicinal Mushroom Extracts. So that’s a mouthful. And Nammax works well there. But the company is founded by a man named Jeff Chilton, actually. And Jeff, he found his life’s calling with mushrooms in 1973, and he worked for a large commercial mushroom grower in Olympia, Washington, called Ostrom Mushroom Farms. And at the time, they were producing about £2 million pounds of fresh Agaricus or the white button mushrooms that we commonly eat. That company actually started to branch out into what were called specialty mushrooms. So starting to grow species like Oyster mushrooms and Shiitake mushrooms and innovating with R&D and innovation in the growing of those. So underneath an expert mycologist, Jeff got interested in that. And then in 1978, that company introduced the first major commercial-scale Shiitake log production. So that really began the ability to get mushrooms other than just white button mushrooms. Because of that exposure, Jeff wanted to further pursue his studies, so he went to the Dutch School for Mushroom Growers in 1976, and then that gave him a broader outlook, exposed him to different types of entities in the mushroom world, growers, sellers, so forth. And then in 1983, after ten years of kind of commercial mushroom growing back in the States, Jeff coauthored a classic book on mushroom growing called The Mushroom Cultivator.

So this is the first book that was ever written that told people how to cultivate the Psilocybe species of mushrooms or the psychedelic mushrooms. So it’s still in print, classic textbook co-authored with another famous mycologist named Paul Stamets. So by 1989, research made it pretty clear after all that time of the book being published and so forth, that specialty mushrooms were sort of functional mushrooms were really the future of mushrooms. So in that year, in 89, Jeff attended the International Society of Mushroom Science Conference in Nanjing, China. And that really exposed him to a whole different world where 85% of the world’s mushrooms are cultivated in China, period, whether they’re functional or for food. So through the relationships built there, that’s where Jeff started the supply chain and instituted the first organic grower certification school and got the different certifying agencies on board to take what had been done in the mountains of China for hundreds of years and put an organic system behind it for growing and producing extracts. And so since 89 has been doing that and instituting higher and higher quality standards, as the technology advances and more analytical techniques become available.

Bethany Jolley: Wow, that’s incredible. Like his whole life mission has been to develop these mushroom extracts.

Bill Chioffi: Yeah. And tying my own personal experience in with this, I’ve had the great fortune to work with a couple of really unique founders in the industry very closely. The first is Rick Scalzo, who founded a company named Gaia Herbs, and Rick no longer owns Gaia Herbs, but he’s certainly working by Rick’s side and learning about vertical integration of organically grown materials into a commercial production of herbal products in an organic system. I really saw how in Rick’s experience, which was as a clinical herbalist, was to integrate formulas into people’s health care regimens that really had an effect and addressed not just symptoms, but many times underlying things like digestion that you might not connect with certain types of health-related illnesses. And so through the results, I saw that these formulas work, but it was also the quality behind them, like the way that the materials were grown, processed, analyzed, and finally delivered to a consumer. And I worked in manufacturing, I started in 1997, and that part of my career in natural products Prior to that, I was in retail, so I had no intention of becoming an herbalist. My background in college was as an English major, and I taught English as a second language and actually got exposed to herbalism in Eastern Europe in Poland when I first lived there in 1992.

But at any rate, so connecting back to Jeff and the founder of Nammex, I had been a customer of Nammex and a client and friend of Jeff’s over the years, and so actually got to see all of those materials go through a very rigorous quality testing where we validated their certificates of analysis through the process. And that has been part of my work as a supply chain manager and sourcing expert over the years. And the products truly always were, as stated on the certificates of analysis. And so the specialty of staying in your lane and producing those types of mushroom extracts and then further developing as consumers become more aware of more than just Reishi Mushroom and Lion’s Mane and a few others I think suits Nammex really well. And the founder is still involved in the business in a major way. More so on the research and development side. Now working with Health Canada on a license called the Controlled Dealer Substance License to be able to produce Psilocybe species of mushrooms for characterization, an analysis, and then potential research for use in clinical trials regulated by the government.

Bethany Jolley: So it sounds like you have all of the testing in line and certifications and the research teams to really ensure those high standards of quality and authenticity.

Bill Chioffi: Absolutely. And as any business evolves over time, new things will be added as they’re available in, let’s say, validated methods. And we’re in Nammex is participating now in working with standard-setting organizations such as the Association of Official Analytical Chemists, or Aoac, and then the United States Pharmacopeia, or USP. So those two organizations here in the US and internationally help set standards by which analytical chemists and laboratories are able to reproduce tests for purity, quality, and potency.

Bethany Jolley: Music to my ears. I love hearing the use of those validated methods. Something that isn’t talked about often with wellness brands is the financial aspect of business. So being in supply chain, how have you tackled the intricacies of managing various transactions while aligning with Nammex’s core values?

Bill Chioffi: So my own personal philosophy is that we want to move beyond transactional relationships with our clients and focus on that second word, the relationship. So whether they’re a brand that’s just starting with no experience in the natural products, Food, Beverage, or whatever category, or they’re a large CPG-type company that has a breadth of experience in this category. You’re still working with people who are people, and so you want to realize that the relationship has to go beyond transactions. But let’s not say that they’re not important following up on things like sample requests and new customer onboarding and so forth. You can imagine with the explosion of interest in mushrooms, Nammex receives a wide variety of inquiries, and Some of these inquiries are from companies who have an idea that they would like to start a business and some are from very well-established businesses selling other types of herbal supplements or dietary supplements that are now starting to move into the mushroom category.

We see this in the CBD hemp space. That’s a very large new sort of sector for a Nammex business. And so yeah, I think moving beyond those transactions, getting to know your client’s needs, specifically having one thing that I really enjoy our phone conversations for a quick chat just to get to know each other. I don’t think we use the phone enough anymore and it’s at our disposal. And not to say that Zoom meetings and emails don’t serve their purpose, but I often find a five-minute phone call saves me about 1050 emails, so. Right. Yeah. So moving beyond the transaction, but monitoring those with your systems, and certainly there’s technology now that can integrate what’s coming in through your email servers with your client relationship management. So we try to use those tools and let some of the technology take care of things that possibly Lion’s Mane might be able to help, where you just forget to follow up on a lead or because your inbox has exploded. Yes.

Bethany Jolley: So speaking of technology, I feel like the world of wellness is becoming so tech-oriented. How has Nammex harnessed technology’s potential, possibly in unexpected areas, to enhance your mushroom extract offerings?

Bill Chioffi: Well, Bethany, I can think of a couple of different ways. One way, because of the better technology to analyze things like heavy metals and metabolites that could both be inherent to the mushroom or come from an outside source. Certainly the metabolites of the mushroom active biological chemicals that are there can be measured more accurately now than they ever could. So using that type of technology to work with R&D and manufacturing is one way. But oftentimes, as these, they call them, limits of detection get more and more robust and increased where you can detect the smallest amount of something in a substance, smaller and smaller amounts of them, we start to see it informs our manufacturing. And in the case of, let’s say, a mushroom-like Turkey Tail, Trametes versicolor that typically all of the Turkey Tail that has been sold or extracted or produced comes from the wild. It’s one of the most predominant species in the world’s forests and typically grows on wood. And over the course of the years of analyzing these for the standard heavy metals, microbes, pesticides, and other contaminants, it’s clear that the wild sources had a fluctuating amount of those things with lots of raw materials. This means that starting at the beginning of testing your raw material before it’s even extracted, informed us that, hey, we are having more and more trouble finding amounts of Wild Turkey Tail that meet our specifications for heavy metals and other contaminants.

So typically it wasn’t cultivated in China. It’s not really a culinary mushroom, it’s not eaten, it’s not a crossover species like Lion’s Mane and Shiitake, obviously, and maitake even are all consumed as foods. But turkey tail is a hard woody Polypore not really very delectable. So anyway, Nammex is evolving into bringing that one into organic cultivation because in an organic system using wood substrates in controlled. Rowing conditions in a natural setting in shade houses. Outdoors, but not relying on the collection of the material from the wild, which also in terms of sustainability. Takes the stress off of that species in the wild and allows it to be able to perform its duty of decomposing wood matter so that the ecosystems can continue to thrive. So that’s one way that sort of that technology, without having all of that intricate data on the quality of the starting raw material and bothering to do that every single time a batch was made, we may not have made that discovery to say, Hey, we need to start cultivating this species.

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I don’t think consumers realize all of the analytical testing that goes into these mushroom ingredients and trying to establish specifications for something that’s picked out of the wild, it can be a little difficult. So for those listening, if you want to learn more about the turkey tail mushroom in particular, you can go to Nammex’s website at www.nammex.com and there is a page there talking about turkey tail mushroom cultivation breakthrough. And it’s really fascinating. So I encourage you to check it out. In my experience, I’ve had to deal with a lot of regulations, whether it be FDA for safety and quality or FTC advertising regulations. So it really can be a delicate dance. How does Nammex ensure compliance and innovation coexist harmoniously in the ever-evolving landscape of nutraceuticals?

Bill Chioffi: Wow, That’s a lot to ponder. And as you said, it’s very complex. I mean, we do operate in a highly regulated field despite the continuous messaging that the dietary supplements industry is not well regulated. It’s very well-regulated. I would question the resources that are being put forth into the government agencies that are following up and creating these regulations. That’s a whole nother story in terms of what Nammex does to make sure that we stay innovative and cutting edge and stay within regulatory compliance. Interestingly, most R&D factions of companies are not even on the scope of what the FDA is concerned with. So research and development does not require standard operating procedures and GMPs, although you better have some good systems in place if you have an R&D program.

But that’s just to say that it’s not part of FDA’s purview, but with the manufacturing regulations and with staying on top of international import regulations, let’s say, as those change and then also monitoring things like, let’s face it, from an economic standpoint, things being imported from China are tariffed. So we have these tariffs to consider while other costs are rising, trying to keep the cost of our extracts manageable because we don’t foresee any immediate relief from those tariffs, although there’s always hope. So tapping into also the mind of the consumer and having been in the business for as long as Nammex has, and listening to what our brands tell us that their customers are asking for and supporting their innovation and R&D with the types of products that they demand and that we have a really consistent supply of. That’s really the one way to stay on top of innovation is just to listen to your customers and they’ll tell you exactly what types of products people are looking for. And there’s also a really good data, increasing amounts of good data from companies like Svans and others that analyze these in the marketplace.

Bethany Jolley: And you’re absolutely right. There are so many ingredient manufacturers that don’t have GMPs in place and the various requirements or SOPs that you hope that they would have. So that’s why I always encourage brands and supplement manufacturers to really vet who they’re purchasing ingredients from. And I’m glad to see that Nammex has a strong quality program in place and they follow the regulations to a T, it sounds like. So from your extensive experience, could you guide us through the journey of how a Nammex mushroom product evolves from conception to cultivation to final extraction?

Bill Chioffi: Yeah, absolutely. And I’ll take the example of one product that will be released soon here. So I feel like I can maybe this is even an exclusive for the neutral podcast. We’ve been working on a couple of different products and at Supply Side West in October will be formally rolling those out. But the mushrooms are all grown in China, as I was saying, and Zhejiang province, and there are numerous species that haven’t hit the functional mushroom market yet that are widely used in commerce and food worldwide. One that I can think of is the woodier mushroom. And so some of these jelly fungus I think are consumed widely, yet we don’t really have an auricularia or woodier in commerce yet. So the mushrooms are grown on wood substrates and it could be a wood log, it could be wood chips or sawdust log composition. There are plenty of trees from forestry operations and then trees grown specifically for the purpose of producing wood substrates for mushroom growing that are in that region. And so since most of these mushrooms naturally decompose wood as their substrate to produce a mushroom, that’s where that starts. So the mushrooms would then be out in a sterile culture and inoculated and then large wish I had pictures to describe it, large sort of shade houses with setups. Holding these inoculated logs in various fashion are set up with the right climactic conditions for moisture and so forth and the right amount of light as well.

Bill Chioffi: In the case of like Reishi mushroom, these are inoculated onto individual logs and then that individual log is buried in the ground. So that kind of protects the moisture, humidity, and the controls of the natural environment for the Reishi to be able to sprout out of that log and come up out of the dirt and form a mushroom. And so when the mushrooms are harvested, this is important to note all mushrooms you’ve ever eaten are hand-picked. So the picking of mushrooms is all performed by hand, which starts to roll up to some of the economics with mushrooms. Why are you paying 1099 1199 a pound for organic Shiitake mushrooms in the grocery store? Don’t forget that that mushroom is about 90% water or more. So what you’re really paying for is 90% organic water and then the rest of the mushroom substance there. But at any rate, that’s why going to a place like China that has a wealth of these mushrooms and a long history of growing them, they’ve really dialed in the growing cycles of these and have a supply where we can get them regularly. So I think that’s the first part of innovation. Is the ingredient regularly available and can it meet a specification time after time? So and it really begins with that growing and integration of the growing of the raw material that you’re going to then produce into the extract.

So in the case of a maitake product that we’ve been developing over the years of analyzing Grifola, Frondosa, or Maitake, it’s apparent that it will produce higher amounts of Vitamin D2 on exposure to ultraviolet light. So let’s say sun drying it as opposed to drying it in a drying barn with forced hot air, let’s say, seem to increase the Vitamin D2 levels. And interestingly, mushrooms produce that same type of Vitamin D that our skin produces D2 more like humans than plants. I would say in that regard, genetically is a fungal species. So by taking a look closely at analyzing Vitamin D2 levels, batch to batch with maitake and then various types of exposure of UV light, we have been able to produce a mushroom extract that will have standardized levels of Vitamin D two in the matrix of a whole maitake mushroom extract that’s just dried extracted mushroom. So the extraction part, once you’ve grown these mushrooms picked them, dried them, now you’re going to mill them into some type of particle size. And then traditionally mushrooms are decocted or boiled in hot water for their preparation. Many of the TCM classics like the Shennong Classic describe boiling mushrooms and hot water in cut pieces. And so essentially there are giant extractors, stainless steel that boil the mushrooms. And then you can also extract them with alcohol as well to get out some of the what we call secondary metabolites or small molecules that are produced in mushrooms that are biologically active.

Those are soluble in water as well. But ethanol will fully extract them and they’re quite valuable in the chemistry. So we want those to come out. After that has been boiled in a large vat. I’m oversimplifying this, but that slurry that comes out of the extraction the way that Nammex does it is to spray dry that slurry as is. So the liquid typically in an extraction, the liquid is separated from the whole material and then sprayed, let’s say, onto something like a starch, like Maltodextrin, or some other type of carrier. Since mushrooms contain about 65% or more in soluble fiber. There’s no need to use a carrier. You can use the mushroom itself as a carrier. So when we produce what we call a 1 to 1 extract, one kilo of Reishi mushrooms will produce one kilo of extract. So you’re not really losing anything in the process. You’re boiling the mushroom and then you’re extracting it in the hot water. Mushrooms are hard in their composure, right? Their structure is made of chitin in the cell walls. Chitin is the same molecule that it’s in crab shells and crustacean shells that gives them their shape. So this chitin needs to be broken down. And imagine inside the chitin in the cell walls are the beta-glucans and polysaccharides and other things that we want to be able to consume. I don’t know if you’ve ever tried to eat a crab shell, but it probably passes through almost undigested through your system.

But there are certain ways to be able to extract these, to break it down, and make them more available. That’s the start-to-finish process. And oversimplified. But also in stating that after that dried extract is produced through spray drying, it’s milled and then tested again for again all of those same quality parameters. And also checking the chromatogram of the mushroom to see that the profiles match the original mushroom material. We lose anything in the process. So I tried to do the best I could to make that simple. But in the case of the maitake mushroom, you see that we had been producing that extract for some time, but using the analytical data and bothering to look at a precursor to vitamin D2 called Ergosterol, we’re able to dial in on these higher levels of that fungal compound in maitake mushrooms, and that’s actually part of our quality program. Ergosterol is a fungal marker that the grain industry has actually used for quite some time to check to see if a large batch of grain may be contaminated with some type of fungus. So all fungus will produce varying amounts of ergosterol. So it kind of gives you a good idea of total fungal matter present. So yeah, we’re excited about this product. And certainly Vitamin D is getting more and more attention for both skin bone health and certainly immune health.

Bethany Jolley: Thank you for sharing that. It sounds like the future holds a lot of promise at Nammex and lots of exciting projects ahead. And the one you just discussed is fascinating and quite complex, but I think you simplified it for those of us that don’t know the ins and outs of mushroom extracts can understand it. So thank you so much for joining us today. And as we wrap up our insightful conversation with Bill, we’ve really tapped into the essence of innovation and sustainability within the realm of mushroom extracts. And if you would like to delve deeper into the world of Nammex and explore their array of mushroom products, you can check out their website at www.nammex.com. And as always, we invite you to join us on social media as we continue to unravel the intricacies of nutraceutical advancements. Remember the journey towards pioneering wellness never ends until our next episode. Stay curious and keep reshaping the future of wellness. Thanks for tuning in to this episode of NutraPreneur. If you enjoy the show, please subscribe and better yet, leave us a review as it really helps us grow the show.