Gatorade’s inventor, Dr. J. Robert Cade, who died Nov. 27 in Gainesville, Fla., left a legacy in Indianapolis that stretches back four decades to the birth of the multibillion-dollar sports drink industry.
The invention became a blockbuster product for an Indianapolis-based company and spawned the creation of an Indianapolis-based trust that has doled out tens of millions of dollars in royalties to inventors and other beneficiaries. The city continues to get an economic jolt from Gatorade, with nearly 500 local workers directly involved in bottling and distributing the drink.
Cade, 80, was a kidney specialist and medical professor at the University of Florida when he and three assistants invented the drink that became Gatorade. Two of the assistants-doctors Dana Shires and Alejandre De Quesada-later moved to the Indiana University School of Medicine.
When Cade first drank some of his invention, he vomited. One of the members of his team said it tasted like toilet bowl cleaner. But Indianapolis-based Stokely-Van Camp Inc. decided to license the nasty-tasting liquid, anyway. It reformulated the flavor and rolled out what became one of the most successful U.S. consumer products ever. Today, Gatorade holds an 81-percent share of the $7.5 billion sports drink market.
“No one dreamed the product would grow into what it is today,” said William Stokely III, former CEO of Stokely-Van Camp, who now lives in Tennessee. “But we were learning on the job. There wasn’t a market for it and we had to overcome that prejudicial thinking.”
Cade began working on the drink in the mid-1960s, after the coach of the University of Florida football team noticed his players didn’t need to urinate after games or long practices and asked Cade why.
Cade discovered players could lose up to 18 pounds, nearly all of it water, during a game played in the swampy Florida heat. He came up with an electrolyte and fluid-replacement solution that helped keep the athlete’s blood-sugar level up and slowed the loss of blood volume.
“If you’re working and sweating, you become volume-depleted. Your blood volume will actually contract. Gatorade prevents that volume depletion,” Cade said in a 1989 interview.
“It’s the same as sweat without the smell,” Robert Mouser, an Indianapolis doctor who helped commercialize the invention, told an IBJ reporter with a laugh.
Seeing potential, Cade offered rights to the invention to the University of Florida in 1965. But it passed and cleared Cade and his assistants-Shires, De Quesada and James Free-to market the drink through an outside company, Stokely said.
“They went to five or six companies and were turned down. It was after the others had turned them down that they came to us,” he said.
“Dr. Cade deserves all the credit for
inventing it,” said Mouser, who’d been a fraternity brother of Stokely’s. “I told Bill [Stokely] they ought to market it as a sports drink.” Stokely-Van Camp had planned to market it as a medication, which would have necessitated U.S. Food and Drug Administration approval.
The doctors provided the company the exclusive license to market Gatorade.
“We reformulated it so it was palatable, but we never got to tasting great,” Stokely said.
Stokely-Van Camp was sold to Chicago-based Quaker Oats Co. in 1983 for $230 million. Quaker, in turn, was bought by PepsiCo in 2001.
By the time Gatorade came to market, Shires and De Quesada were at the IU medical school. In 1967, Shires approached local attorney Claude Spilman, who was a kidney dialysis patient, for help establishing a trust to receive and distribute income from Gatorade sales. The trust, still in operation, has distributed large sums to beneficiaries-though Gary Klotz, a Bingham McHale attorney representing the trust, declined to provide specifics.
Gatorade’s debut was inauspicious. Initially, the drink was sold in 46-ounce cans, which ultimately leaked because of the high saline content, Stokely said. That resulted in a total recall.
“We could have killed the product a couple of times, but it worked out,” Stokely
said. “It’s a huge business for Pepsi now.”
Mouser said he traveled throughout Indiana and the surrounding area talking up the qualities of the drink and for nearly two decades received royalties.
“That was my involvement. I got a small percentage of the royalties. It was a couple of percent,” he said. “[Cade] got the majority. But it was a good income.”
After Stokely-Van Camp started selling Gatorade, the University of Florida sued the trust to get some of the money. After a 31-month legal battle that concluded more than 35 years ago, the parties settled.
The University of Florida earned a 20-percent share of the royalties and has received more than $100 million since 1973.
Earlier this year, PepsiCo broke ground on a Gatorade warehouse in an industrial park near Indianapolis International Airport. The 105-acre site will house a 1.1-million-square-foot building and is near a Gatorade bottling plant employing 470.