In a major breakthrough in the food industry, NutraSweet Co. yesterday announced that it will market a low-calorie, low-cholesterol fat substitute, beating a number of expected similar products to market by months or years.

Almost immediately after the announcement, a controversy broke out between NutraSweet and the Food and Drug Administration over whether the federal agency should take a role in approving the sale of the "fake fat," which has the trade name Simplesse. NutraSweet claims Simplesse is a natural product that doesn't require FDA approval.

The new product could be a boon to weight- and health-conscious consumers who want the flavor and texture of fat without the calories, fat and cholesterol. It also could be a boon to NutraSweet, a division of St. Louis-based Monsanto Co., which has had a great deal of success in recent years with its aspartame-based NutraSweet, a no-calorie sweetener.

Monsanto stock jumped $4.75 a share to $83.50 in New York Stock Exchange trading yesterday.

Several companies have been working to develop low-calorie, low-cholesterol fat substitutes to fill a market niche that analysts estimate could be worth billions of dollars annually.

Simplesse, which was discovered in 1979, is made by heating and blending the protein of egg whites or milk. The process changes the protein particles into minuscule spherical ones that are perceived by the tongue as smooth and creamy.

Simplesse has 1.3 calories per gram, while fat has 9 calories per gram. A four-ounce serving of chocolate ice cream would be reduced from 283 calories to 130 calories with Simplesse; a 99 calorie tablespoon of mayonnaise would be reduced to 30 calories.

Because Simplesse cannot be used for frying or baking, NutraSweet believes that its most immediate applications would be in dairy products and salad dressings.

Unlike the better known "fake fat" now being developed, Procter & Gamble Co.'s no-calorie Olestra, Simplesse is a natural substance that is physically, but not chemically, changed during processing. Thus, NutraSweet thinks it does not need FDA approval for sale to the public. Olestra, which is chemically derived from sugar and edible oils, is now being evaluated by the FDA, and its approval is not expected until next year.

NutraSweet Chairman Robert Shapiro said products made with Simplesse could be available within the next year or 18 months because the company believes that the fake fat fits within the FDA's list of substances that are "generally recognized as safe" (GRAS). Shapiro said he does not believe Simplesse is a food additive that needs prior approval.

But FDA Commissioner Frank Young criticized Shapiro for not consulting with the agency about the new food ingredient. The safety claim "may be correct," but the company failed to follow FDA procedures for GRAS affirmation, Young said in a letter released yesterday to Shapiro.

Richard Ronk, director of the FDA's Center for Food Safety and Applied Nutrition, said companies can and do make GRAS determinations on their own, but that the agency expects companies to alert it when new products that could have a major impact on the food supply are introduced. "The FDA needs to be in a position of knowledge rather than ignorance to assure the public that the food supply is safe," Ronk said.

Young said he was particularly disturbed that NutraSweet failed to consult with the agency on its new product in light of the time FDA spent on approving and defending aspartame.

Shapiro said NutraSweet didn't think FDA approval of Simplesse "was either required or what they {the FDA} would want to do. They want to know more about the product. We will provide them with the information they'd like." Shapiro said he is "confident" that the product falls within the GRAS classification.

He said the situation was different from that of aspartame, which was evaluated by the FDA for several years. "Our view is that {Simplesse} fell within an entirely different regulatory category," Shapiro said. "The procedures that apply to aspartame don't apply to this."

Researchers have been trying to develop a safe and effective fat substitute for many years, realizing the potential market for a product that could be the edible equivalent of having it all. The race to market the first fat substitute was thought to be won by Procter & Gamble, the first company to submit a petition to the FDA last June. P&G is seeking approval for Olestra, the trade name for its fat substitute derived from sugar and edible oils.

Diane Mustain, an analyst with Duff and Phelps in Chicago, said that there is "probably room in the market for more than one type of fat substitute," and that the outlook for both products is "very promising," assuming neither has adverse side effects.

Unlike NutraSweet's product, P&G's Olestra has no calories and is not metabolized by the body. It has also been shown to lower blood cholesterol levels.

Olestra can also be used for cooking and frying, and P&G's petition seeks approval for Olestra as a partial substitute in its cooking oils (Puritan and Crisco), for salted snack foods and for cooking oils for fast-food establishments.

Although potential uses of Simplesse are more limited, Shapiro said products made with the ingredient "have all the excitement associated with the originals without taking in the fat and calories."

In consumer taste panels, NutraSweet pitted superpremium ice creams against ice creams made with Simplesse. Those surveyed preferred the Simplesse product in 50 percent of the cases, according to Norman Singer, director of product development at NutraSweet and creator of the new fat substitute. Singer added that the product also has the potential to reduce calories in fat and sugar-laden products even further when used in combination with NutraSweet's sugar substitute.