Namyang Dairy embroiled in patent infringement scandal
Namyang Dairy Product's “Inner Care” drink / Courtesy of Namyang Dairy Product
By Kim Jae-heun
By Kim Jae-heun
Namyang Dairy Product, which recently admitted to issuing a false report to exaggerate the health effects of its yogurt drink, “Bulgaris,” is now embroiled in a patent infringement case.
“Inner Care,” another yogurt drink made by the dairy company, comes with a health-supplementa pill placed between the cap and the bottle to drink with the beverage. And this combination is nearly identical to a rival's product.
Korea Yakult's prebiotics drink, “MPRO3,” also comes with a health-supplement pill. Prebiotics are compounds that induce the growth or activity of beneficial microorganisms such as friendly bacteria and fungi.
The company first introduced MPRO3 in 2019 and cumulative sales have reached 100 million bottles. Namyang Dairy launched Inner Care in February this year.
The two products are almost identical to each other in that both yogurt drinks contain pills inside the bottle caps. Even their caps are the same size.
Korea Yakult's subcontractor, Natural Way, which holds patent rights over the design that places a pill inside a yogurt drink, filed a suit against Namyang Dairy last month.
“The size of the MPRO3 container does not follow international standards. However, if each products' caps fit exactly the same, I have to say Namyang copied Natural Way,” an industry source said.
Natural Way said it spent 4 billion won ($3.6 million) to acquire the patent rights and commercialize the design and the firm is highly concerned that Namyang Dairy's infringement of intellectual property will cripple its operation.
“It can hurt our sales up to 40 percent,” a Natural Way official said.
However, the dairy firm said it is sure there are no legal problems as it checked with a patent law firm prior to launching Inner Care.
“Such an idea of having a yogurt drink with a pill inside has already been commercialized overseas. We that there were no problems adopting the same idea for our yogurt drink,” a Namyang Dairy official said.
Namyang could face a further plunge in sales after consecutive scandals. Its revenue declined to 948.9 billion won last year, falling below 1 trillion won for the first time in 11 years.
In 2012, just before it was hit for abusing its power over subcontractors, Namyang Dairy's annual sales reached 1.36 trillion won. Rival Maeil Dairies surpassed Namyang Dairy to take the No. 2 position in the local milk market recently.