Business Growth in Botanical Science with Elan Sudberg of Alkemist Labs

Episode Overview

Episode Topic: In this episode of NutraPreneur, we delve into the fascinating world of botanical testing practices with Elan Sudberg, the CEO of Alkemist Labs. Join us as we explore the experiences that led Sudberg to pioneer this field, the significance of full method transparency, and the personalized technical support that sets Alkemist Labs apart. Discover how the lab plays a crucial role in assisting companies to maintain quality and cGMP compliance in the realm of botanicals.

Lessons You’ll Learn: Elan Sudberg shares valuable insights into the importance of botanical testing and maintaining quality assurance in the nutraceutical industry. Elan Sudberg emphasizes the critical importance of transparency, the significance of challenging scientific methodologies, and the role of next-generation transparency in building consumer confidence. As a seasoned expert in the field, Sudberg provides practical advice for companies navigating the evolving landscape of botanical science.

About Our Guest: Elan Sudberg, the CEO of Alkemist Labs, brings a unique perspective to the nutraceutical industry. Born into a family involved in herbal supplements, Sudberg’s journey led him to pioneer botanical identity testing inadvertently. With a chemistry degree and a focus on transparency, he has been actively contributing to industry associations and advocating for advancements in botanical testing.

Topics Covered: The conversation delves into Alkemist Labs’ journey, from accidental entry into the botanical testing side of the industry to becoming a pioneer in botanical testing practices. Sudberg discusses the importance of full method transparency, personalized technical support, and initiatives like Alkemist Assured certification. The episode also touches on the future of botanical science and quality, including Alkemist Labs’ plans to expand its testing scope into new areas, such as psychedelic plants and fungi.

Our Guest: Elan Sudberg – Innovator, and Advocate for Transparent Botanical Testing Practices

Episode Transcript:

Elan Sudberg: You can use a lot of different testing technologies. Not all are good, not all are fit for purpose. And if you just throw a test at it and get a result and move it along and that’s all you care about, you can basically be putting poor-quality material into the industry. At worst case, people could die. Least bad is that it won’t be a good quality material won’t work. You won’t get return of sales.

Bethany Jolley: Welcome to NutraPreneur, The Neutra 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. Today we are delighted to have Elan Sundberg, the CEO of Alkemist Labs, a pioneering force in botanical identity testing and phytochemical potency analysis. Welcome. It’s so great to have you today.

Elan Sudberg: Thank you, Bethany. Pleasure to be here.

Bethany Jolley: First, it’d be great for you to tell us about what experiences led you to pioneer botanical identity testing at Alkemist Labs.

Elan Sudberg: It’s a family-run business owned and operated by myself and my father, who is a retired chiropractor, acupuncturist and had a line of herbal supplements. So I basically was born into this industry. He made liquid tinctures in our garage until the FDA. That’s all history at this point. And so we actually did some quality control for incoming raw ingredients for his tinctures failed some things. And the vendors who sold us those things asked us for those reports to prove we were wrong, that the material was correct. We gave them the results, and they were astonished by the quality of just the simple internal report and the fact that we showed them everything. And then they asked us to test another batch, and we did, and then another batch, and we realized we were becoming a testing laboratory and basically just accidentally fell into the testing side of this industry and then closed up shop for the tincture business. And that was about 27 years ago.

Bethany Jolley: Awesome. And I think as the supplement industry and just the use of botanicals is just growing rapidly, and I think understanding testing and seeing transparency and education is really important right now. How does full method transparency and the personalized technical support that you provide benefit your clients?

Elan Sudberg: When we started the lab, I was just exiting high school and was forced into getting a chemistry major, which was not my favorite subject in high school. And I remember in chemistry class, you would go to the lab and you would prepare a lab notebook in advance, and you’d have to show the lab professor the lab notebook. With all of your calculations already done and ready to go, full transparency. What a concept. And so that’s how I was trained as a chemist. And then when we started produce reports to industry, we didn’t see any other way. The thought of proprietary didn’t make sense. When you’re in college, if there was no proprietary, it’s you. It’s full disclosure. And then somehow in industry you can say proprietary, all this secret sauce. But then when you go to court, it’s all going to come out. So we actually just pioneered transparency because that’s how the only thing we really know or we only knew at the time, but oddly enough, we got a lot of feedback from the various other labs existing that, hey, you’re going to put yourself out of business, companies are going to take your methods and they’re never going to come back.

Elan Sudberg: And so here we are nearly 30 years later, and that has happened. Companies have come to us, tested it for a couple of years and then internalized the methods, but they still come back as needed. This to me, also plays into the consumers. There’s a desire to know what’s in these products, and not just to accept what’s on the labels is to see more. Even if they don’t fully understand it, they want access to the data. And I think that access, and even if they don’t get what a HPLC chromatogram is or an HPLC chromatogram is, that gives them the confidence that no funny business is happening with that brand and the companies that aren’t willing to share. I think it’s very telling. And so it just happened by accident again, but I consider myself a marketing guy with a chemistry degree. And so I think I’ve always appreciated the CSI type of aspect of knowing. And we bring that to the dietary industry.

Bethany Jolley: Yeah, absolutely. And I think you bring up a good point. Consumers do want to be more educated, and people are aware of some of the safety-type testing that takes place, like micro testing and the vitamins that are tested. But not a lot of people understand the botanical testing. So with botanical testing specifically, how does Alkemist Labs assist companies in maintaining quality and cGMP compliance?

Elan Sudberg: So the first step in cGMP compliance is identity testing. Makes no sense to do pesticides, heavy metals, residuals, or microbes if you don’t even know if you have the right material. And so back to when we first started Funny Stories. I cashed in bar mitzvah money to buy our first pieces of equipment. My father cashed in for one case for his first our first piece of equipment. So we started off low tech because that’s what we had the ability to afford. The technology we use and deployed back then is over 100 years old HPLC, it’s botanical microscopy that goes back hundreds of years, and that was a function of having an appreciation for the nuanced approach of those techniques, but also because that’s what we could afford. We couldn’t afford HPLC galore. And now we have whole bays of them, of course, but they just so happen to be not a lot of companies focusing on identity testing. Everyone was using the fanciest, coolest, sexiest new equipment. And so we were that little lab just happened to focus on identity testing, which ended up being very important when ten years later, after our start date in 97, in 2007, the GMPS came out and they made it very clear that identity testing is absolutely required and critically important. And the industry had very little choices where to go. And we had, like I said at that point, been ten years in collecting reference materials, housing them in on-site herbarium, which is basically a room full of control samples of plants. And it really made us very quickly the authority. Botanical identity testing. And of course, since then we’ve moved over to potency and contamination as well. To pioneer that and all in the botanical and fungal space, which is where we started and what we love to do.

Bethany Jolley: Yeah, absolutely. And I think, of course, it’s important for the finished products and the brands to have the confidence that their finished products are testing out and showing what they want it to. But I think it’s also a great resource for manufacturers so they can submit their raw materials to your lab to be tested and hold their vendors accountable. Kind of like you said, you were receiving things from suppliers and testing it and being like, hey, this isn’t what we thought we ordered. I think that’s really important in this industry as well.

Elan Sudberg: Unfortunately, this industry has been plagued since really the dawn of allopathic medicine, which for which I’m grateful exists. Don’t get me wrong, I’m not anti really anything. It’s available for us when you need it. But since the dawn of allopathic medicine, our industry has been sidelined as witchcraft and snake oil. And then most recently, and even around the pandemic, disinformation that we are unregulated, untested and unsafe and which is also often false. I mean, we’re highly regulated and efficacy is to be anecdotally debated, of course, safe. I mean, we have the best safety record of all FDA-regulated product categories. More people have died from pharmaceutical drugs in our conversation time here than probably the history of our most recent 100 or 200 years in this industry. So I feel like there’s this huge opportunity to market quality. So you mentioned the manufacturers, the ingredient suppliers. We’re doing an absolutely terrible job in falsifying the narrative by showing the quality that we do have in our supply chain. So that’s something that I’ve been really working hard even as a laboratory. I’m not selling products. I’m trying to urge my customers to share their reports to one-up their competitors who aren’t willing to or can’t because they have poor quality.

Bethany Jolley: Yeah, absolutely. I’d say you’re a champion of next-generation transparency. So what initiatives has Alkemist Labs implemented?

Elan Sudberg: From the very beginning, we knew no other way than to show all the data for our reports. And then later on, I want to say about 10 or 12 years into my career, I realized that the consumers aren’t getting access to this data. So we have customers spend hundreds of thousands a year with us, millions a year in totality with all their labs. And they put that products to CVS in a drawer. It’s never to be seen again. And just basically a sore point on a balance sheet for a CFO or on a PNL. And I think that is marketing gold. So we’ve pioneered this concept of next-generation transparency, which is basically just giving the access to the raw data to the consumers. We’ve then taken the raw data, I call them the nerd versions of the course, the ones that the FDA would look at or internal documents. And we’ve made consumer-centric versions. So basically, I think Readers Digest mean a certificate of analysis so that basically anyone can read it and understand. And then most recently, a few years back, we pioneered something we called Alkemist Assured, which is a certification program. It’s basically a surveillance program. It’s a logo that goes in a bottle. It can’t be purchased. It’s an adherence to a surveillance program that’s specific to the brand, the batch cadence, the complexity of the ingredients.

Elan Sudberg: And that is supposed to go all the way to the consumer. And you can find it in some stores on the shelves for some products now. But oddly enough, it’s been making more headway in the internal ingredient side of things as well as contract manufacturers. So brands are now selling raw ingredients, powdered botanicals or extracts or liquids or whatever it might be, with an Alkemist Assured logo on it all the way through the supply chain. Contract manufacturers are now testing the material because they make things for 3 or 4 different brands. They just label differently. And so now there’s ingredient suppliers with Alkemist. Sure, there’s contract manufacturers with Alkemist, and now there’s finished products on the store shelves with an Alkemist shared logo. And behind that is, of course, transparency, consumer centric surveys. And we implore our customers to have batch-to-batch lookup tables. For some folks who can look at a bottle, see the lot number, go online and find the actual results. And they don’t have to understand it. But the fact that it’s available gives them confidence to buy your product over another brand who’s not willing to share the data. Because again, why wouldn’t you share the data?

Bethany Jolley: Yeah, absolutely. I’ve always encouraged brands to share the data that they have, because it’s so important for people to see that and to have confidence. And right here in the US, it is a bit odd how companies just keep them on file if they need it for an audit or an inspection, they’re not really utilizing it. They could be using it as a marketing tool as well. And so I think all great points.

Elan Sudberg: Yeah. Thank you.

Bethany Jolley: And could you highlight for us any contributions or collaborations with industry associations that really promote education and research and advocacy.

Elan Sudberg: Yeah. So as I mentioned, I’m a marketing guy with chemistry degree and participation in trade shows or trade associations. Is is absolutely primary marketing for us. It’s one we absolutely care about the industry more than any other lab, as far as my experience goes. But participating at the table, that’s saying you’re either at the table, you’re being eaten for dinner. So I’d rather even I’m not selling a product. I participate at the table as though I am. So we are very actively involved with AHPA,merican Herbal Products Association, which is a whole bunch of different committees for industry guidance and education among the board and the executive. Board, very active with the American Botanical Council, and they have their bath program, which is a really wonderful program, just really opening the conversation about adulteration in the industry, specific to particular botanicals and lab guidances and whatnot. Unpaid Natural Products Association active there with their various committees and their executive committee, and then CRN Council for Responsible Nutrition active there, and then NPA Natural Products Association, and then lastly the Natural Animal Supplement Council. So over on the pet side, I’ve just rattled off basically all of the associations that we were active with that all offer their own versions of education and industry guidance so that we can navigate these tricky scenarios in our industry and ultimately make a product that works. And while they can’t say helps prevent, treat or cure illnesses, but that’s we all know that’s why we’re here. We just don’t say it legally. But labs are in the background making sure that that’s possible with high quality ingredients, no contaminations. And ultimately that all also leads to return sales, which helps us all keep in business.

Bethany Jolley: This episode is brought to you by nutrapayments.com. If your business needs credit card processing that fully integrates with most major Nutra software platforms, offers the lowest industry prices, and has built in features like recurring billing, $0 trials, and chargeback prevention. And visit us at nutrapayments.com for a free online quote. I think it’s great to be involved with all of those committees and resources out there, and to be able to network and meet with people, because this industry is constantly evolving. So it’s good to have lots of connections for sure.

Elan Sudberg: Absolutely. Very critical.

Bethany Jolley: Yes. And so how does Alkemist Labs balance providing reliable test results while also contributing to broader industry initiatives?

Elan Sudberg: We don’t sleep. I sleep very little. I just don’t need a lot of sleep. And so I burn the candle from late night to early morning. So it takes a lot to be that active. And all the trade associations that I’ve just mentioned. Also, I do a lot of writing and I contribute on LinkedIn pretty loudly. I speak truth to power. The other labs are either small and quiet or monstrous. We consider ourselves the biggest little lab, but we’re approaching the littlest big lab soon, and we have this voice of care and compassion for the industry for which we serve and for which we feed off of. Really, it’s where we eat. So I want to support it as much as possible.

Bethany Jolley: Yeah. And I think there are those labs that everyone knows of in the industry, and not a lot of people know about the smaller labs. Or if you do use a smaller lab, they might be outsourcing botanical testing. So it’d be great for our listeners to know there’s a lab they can just go straight to for all of their botanical needs. So that’s great.

Elan Sudberg: Yeah, I think the only lab in the industry, perhaps the world that has an ISO 17 025 accreditation with a flexible scope for all botanicals by for identity with HPLC and microscopy. So generally an ISO accreditation would be for a particular scope, which is generally Milkfat or pH in whatever some particular method. Ours is this broad, flexible scope for all plants on Earth and all mushrooms on Earth, which is pretty great, and that’s really important. There’s a lot of labs out there, actually. There’s not too many. There’s only a handful of big ones who specialize in all the things tilapia, leather, dye, aerospace, oil and gas, camomille. And then there’s other labs like ourselves that are tiny, and we really boutique. We focus on botanicals and fungus, and we are going to expand into other platforms in the new year and so on. So we have to because our customers are basically begging us to. They’re tired of using the monstrous labs. And there’s a few others that are great in our industry, and there’s a couple that are really tarnished the reputation of the industry by doing poor quality testing, being less than transparent and actually straight up fraud. Some have been noted on the FDA, and that’s one of the tips I always give folks, is, you know, you can search the FDA’s website for 40 threes and warning letters, and there are labs in our industry still existing that have them.

Elan Sudberg: And, you know, that old logical fallacy of ignorance is bliss. The Gpws came out over ten years ago. They didn’t say specifically what to do. They just said, use science. Best of luck and we’ll see you in court. And so you can use a lot of different testing technologies. Not all are good, not all are fit for purpose. And if you just throw a test at it and get a result and move it along and that’s all you care about, you can basically be putting poor-quality material into the industry. At worst case, people could die. Lease bad is that it won’t be a good quality material won’t work, you won’t get returned sales. I would also like to add that there’s a lot of labs internally. A lot of folks are business ex-contract manufacturer, but they have a little lab in the corner doing bare minimum plug-and-play plunger-type testing. And I think those are probably the worst part of our industry. Those are the ones that are not they’re not labs for the industry. They’re internal labs. And no one knows who they are and what they’re up to, except for that is internal auditing they do on themselves, which is incestuous. So my tip is really to audit question and don’t accept anyone’s science. Challenge science and never stop. Challenge the science.

Bethany Jolley: Yeah, absolutely. And you mentioned that you will be broadening your scope for the new year. So what is your vision for the future of botanical science and quality? Alkemist labs?

Elan Sudberg: We’ve been pigeonholed as the identity lab for a long time, and that’s been actually false. We’ve been doing potency testing for quite a bit, and most recently the last two years we added contaminants. Now we can do is it or not? How good is it from the stance of how much caffeine or iconic acids are in there, but also contaminant testing metals, pesticides, residuals and microbiology? Those are all those last ones I mentioned will all be on our scope in the new year, and we’ll the customers are still coming to us because we don’t touch vitamins, we don’t touch probiotics, we don’t touch sports supplement area. And they’re not joking, begging us to take on those various platforms. We’re a small company, we’re about 50 people, and we have to be very careful about where we go, in which direction and who we compete with. There are other labs that, as I mentioned, our entire revenue. Is there an error in the balance sheet and they round it up. We’re basically minuscule to their their PNL and their balance sheet. So we have to be careful who we jump into competition with. But when we moved from identity to potency, it was 100% because clients were begging us. They were like, we need you to quantify the phytochemicals in our plants because we sent it to you for identity and other labs for that. And it’s just a nightmare. And our customer service, our turnaround time, our quality is our value propositions. Price is really low on the list of concerns because running an ISO 1725 is very expensive. There’s a lot of quality hoops that take a lot of time and extra money and personnel, and so we charge more as a result. But you get the high quality. You get the turnaround time, you get that customer support that you don’t get with all the other labs.

Bethany Jolley: Yeah. And I think you just don’t want to overwhelm your team or lead times. Yeah. Take away that personalized aspect that you have, because it sounds like you have a really good relationship with all of your clients.

Elan Sudberg: Yeah. And employees. You if you go to Glassdoor.com as an example, you look at our results or our reviews, there’s only, I think one really nasty one. And you can see the response I’ve given and it’s pretty clear what was going on. But for the most part, our employees love working here. We have a really great culture. Work-life balance is very critical to me. I have two young children and a wife that I love very much, and I can’t wait to be with them. And so I want my staff to have partners who love their job. It’s great if your employees love their job, but if their dogs, cats, wives, husbands, boyfriends, and girlfriends, all of them love the company that they work for. You have happy employees. And so that’s critical. As much as it is critical to have a rapport with customers in the industry. And for me, you’ve met me once. We hug my kids and my wife. Perhaps you’ve even been to my home. And that’s the culture that I provide in this industry.

Bethany Jolley: That’s great. And do you have any advice for companies that are navigating the evolving landscape of botanical testing and quality assurance?

Elan Sudberg: I’d say challenge everything non-stop. The pandemic all taught us fear is a very extraordinary marketing tool, and trust is not to be given lightly. And so there’s that old saying is trust but verify I think, verify but trust then trust. Verify twice. Audit your supply chain. Audit your labs. Don’t accept methods without transparency. Don’t accept. We’ve always done it that way. And you might be a burden to those vendors and those partners. But if they make you feel like a burden for asking normal baseline questions, you find another vendor and run. Find a better lab, find a better contract manufacturer. They should be retained for all samples for years and years. Labs should have no problem telling you how they arrived to the results. If it says method x and x is a, we see something but it says modified. Asked how it was modified. You need to know these questions because the FDA is going to come to your facility in six months and ask you the same question, and you’re going to feel really stupid when you can’t answer it. And you have no transparency behind that data, which ultimately speaks to the quality and safety of your final product, which goes in the stomachs of humans all over the planet. And if you have to think that way, that how are we not poisoning people? How are we making this actually a great product? And you have to back that up with all the data that I’ve just mentioned. So challenge.

Bethany Jolley: Yes, great advice. And can you share any upcoming projects or innovations at Alkemist Labs that exemplify your commitment to advancing the science and quality of botanicals?

Elan Sudberg: Yeah, so there’s this other industry doesn’t fit in ours because we’re in the food sector, dietary supplements. But there’s this psychedelic plants and fungus sector on planet Earth now that is, there’s a psychedelic renaissance or a shroom boom, as you’ve probably heard it. And so there’s this really interesting opportunity to impact mental health like never before. And cannabis showed up and it was medical and recreational. It’s been a mess. And I’m happy we didn’t really jump into there too much. But we do a lot of hemp testing for local authorities only, but not recreational for anyone because it’s still federally legal. But there is more research being done on psychedelic plants and mushrooms by established research leaders, universities and whatnot than ever before. Way more than cannabis ever received. And the professional organizations that are taking interest in that category are really impressive. And so we actually have a DEA registration to federally, legally test all of those substances, plants and fungi, and it will be on our ISO scope in the new year as well. So that’s an advancement not in the industry but in an ancillary industry. And then Outcomes Assured is really picking up traction. The industry has no other CERT program for plants and mushrooms. There are certification bodies and CERT programs, but they don’t really focus on anything but simple vitamins and some fish oils, things like that. So it’s the only one of its kind, and it’s taking a lot of traction. And it’s an invite-only program. So people can’t just come and say, I want that. You have to work with us and you have to earn the ability to do this testing, right. And then we come to you and actually say, hey, you already qualify. We already test your products top to bottom. All you have to do is we figure out a cadence to some random testing, and then we work together and you can put an Alkemist shirt on your packaging. And that’s going to be really big in the next year as well.

Bethany Jolley: That sounds like a really neat program, and I’m sure a lot of brands you work with will want to utilize that.

Elan Sudberg: Absolutely. Line it up.

Bethany Jolley: Yeah that’s great. Well, thank you so much once again for joining us. As we conclude this enlightening conversation, we extend our gratitude to Elan for sharing his experiences and insights into the pioneering work of Alkemist Labs. For more information on their testing services and contributions to industry initiatives, we encourage you to explore the provided links. Stay tuned for more thought-provoking discussions on NaturePreneur. And don’t forget to engage with us on social media. Until next time, stay informed and inspired in the realm of nutraceutical innovations. 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.