Photonz to scale up heart drug production in Europe
By Peter Kerr
April 12 (BusinessDesk) - Photonz, a biotech start-up which counts Stephen Tindall as its biggest shareholder, has signed a deal with French company Separex to extract an Omega-3 fatty acid from its patented microalgae fermentation process.
Auckland-based Photonz, which won a $2.9 million TechNZ research and development grant, is ramping up production of eicosapentaenoic acid (EPA), which is claimed to help lower blood cholesterol levels when used in conjunction with statin drugs. Currently EPA is sourced from fish oil and Photonz claims its technology offers a more secure supply for the US$60 billion cardiovascular disease market.
The company is in talks with several European pharmaceutical-quality contract manufacturers to carry out scaled-up production, which will then be further refined by Separex. Photonz is aiming to turn a profit by 2014.
"EPA demand is going to outstrip supply," said chief financial officer Richard Justice. "The fisheries supply that exists today is under threat."
Fish concentrate the EPA in their own bodies from eating the sea-borne microalgae. Photonz can ferment the same algae and extract EPA direct.
Photonz has a U.S. partner to distribute EPA, and will use scaled up European production to tap into a market worth hundreds of millions of dollars a year, Justice said. Once the company becomes cash-flow positive, it will look to set up other production and concentrating facilities in New Zealand.
The TechNZ R&D grant will enable Photonz to complete its development programme, allowing full manufacturing process at industrial scale. It is the third government R&D grant the company has received.
Since its formation in 2002, it has raised $6.2 million in start up capital, and recently announced at the NZBio conference that it is seeking at least an additional $5 million to help continue its expansion.
"We're still at an early stage of product development," said Justice. "What we've done with the algae fermentation is something no one else has achieved, though there's been plenty who have been trying. We've flown under the radar of most people."
Justice said Photonz has a number of potential exit strategies. Using existing manufacturers in Europe is considered the fastest and easiest way to scale up production and profit he said.
Separex uses supercritical carbon dioxide, where the gas is maintained as a very cold liquid and acts as a solvent, to extract the EPA lipid and deliver a pharmaceutical-grade product that is identical to the fish-derived product.