US firm behind algae-derived beta glucan for feed says $7m 'shot in the arm' will accelerate its trial work

By Jane Byrne

- Last updated on GMT

Related tags Algae

US firm behind algae-derived beta glucan for feed says $7m 'shot in the arm' will accelerate its trial work
Algal Scientific, a US developer and manufacturer of a microalgae-derived beta glucan for use in the diets of pigs, poultry and shrimp, has received backing to the tune of $7 million in a Series B financing round.

Returning investors in Algamune – a zinc polysaccharide complex containing beta 1,3-glucan that is said to support immune health for animals and could help the sector limit its use of antibiotics – include German chemical firm, Evonik, Formation 8 and Independence Equity.

Geoff Horst, company CEO, told us: “The $7m generated is a real shot in the arm for us and will accelerate market penetration, now that we have gained some traction in poultry and shrimp production."

Last April saw those same investors plough $3m into Michigan-based Algal Scientific, so the developer has managed to raise $10m in capital over 12 months. 

"The funding pretty much means we can be viable on our own for the foreseeable future – it will allow us to double down our efforts in generating trial based efficacy data and will also support a heightened marketing and sales push. Where we would see the need for an additional investment round would be when we choose to enter the human nutraceutical arena but, for the moment, we are firmly focused on animal nutrition,” ​added the CEO.

Production process

Algamune is produced by growing a strain of non-GMO microalgae in controlled, sterile fermentation systems. Horst said that it is more cost effective than the standard yeast derived variety.

Algamune production facility

“The beta-glucan content in yeast is low and it is not bioavailable without an expensive extraction step. This has rendered it too costly for widespread use as an animal feed ingredient except in high margin species like salmon, shrimp, and calves.

Our proprietary algal technology can help the shrimp, poultry and pig sectors reap the benefits of beta-1,3-glucan as we produce a whole algae meal that contains over 50% beta-glucan and is bioavailable without further extraction,”​ he said.

Poultry trial data

Since last spring, said Horst, the company has been ramping up poultry trials with the beta glucan.

“We have now metric ton production capacity which has made commercial scale trials a reality. A significant number of poultry players in North America and Europe have been early adopters of Algamune – so far it has been trialed in 25 million chickens and, in the past three months, we have shipped 10 tons of the product.”

Adding beta-1,3-glucans into the diet of broiler chickens can bolster their immune system so their response to disease, stress or vaccination is more robust, while beta-glucans can also bind mycotoxins in feed and limit their bioavailability in the digestive tract, says the US firm.

In a meta-analysis of trials in a variety of settings, Algal Scientific concluded that Algamune provides little benefit under clean university conditions but trials in commercial or challenged environments show an improvement of FCR of 3 to 10 points.

On average, FCR improvement was 4.2 points, which translates as 3.4 times return on investment (ROI) when using the product in poultry feed and assuming an outlay of $2.50 per treated ton. So it is in the lower feed additive price range,”​ said Horst.

Next steps include testing effects of step down treatments under large scale barn trials.

In terms of whether there are any anti-nutrient effects present in Algamune, Horst told us further research was necessary. “We hope to collaborate with nutritionists based at some of the large poultry producers to generate that kind of data,”​ he said.

Shrimp production challenges

The company, which has also been shipping the additive to shrimp producers in Vietnam, said it has also been carrying out research in conjunction with shrimp disease specialist, Donald Lighter, from the University of Arizona.

“We have got good results in terms of shrimp ponds challenged with white spot virus (WSSV) – whereby the addition of Algamune can boost immunity, helping shrimp ward off the pathogen challenge,”​ said Horst.

The next 12 months will also see the company conduct research to refine dosage rates for the different animal species.

Venture capital

Karin Assmann, communications spokesperson for Evonik, told this publication last April that its backing of the algae technology is in line with its venture capital strategy of accelerating the development of new businesses and opening up future growth fields. 

“Algal contributes toward sustainable animal nutrition. In view of the growing global population and the subsequent increasing demand for animal protein, this is an interesting market with attractive growth potential,”​ she said. 

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