BioExx, which manufactures canola proteins on a small scale at a plant in Saskatoon, is talking to a range of potential partners in North America and overseas interested in investing in large-scale production.
However, speaking to analysts after posting a $30m net loss on sales of $5.3m in the year to December 31, 2011, BioExx boss Chris Schnarr admitted his firm had burned through a lot of cash and made many mistakes before arriving at the position it stands in today.
"It's been a brutal road to get here and the company has made many changes along the way”.
But having finally “improved and stabilized our technology, and then confirmed it as to efficacy, scalability, and economics”, bosses were now confident of striking a deal with a partner by the third quarter of this year, he said.
"There is better than a 15bn global protein market that for many good reasons is starving for new non-animal protein sources. This is not a fad. Our products are superior in many ways to high end animal proteins and to other plant proteins.”
Canola is a better protein [than soy], but it is harder to get at
And for those wondering when canola protein was ever going to make any money, it was worth remembering that soy protein was not an overnight success story either, he said.
“I was thinking about how much was spent on developing the soy protein business decades ago in its formative years – and it’s now an industry that is doing something over $4bn a year.
“I don’t know what the number was but you can be sure that the initial cost was enormous and it wasn’t easy. Canola is even harder, it’s a better protein but it is harder to get at. But the prize is bigger.”
The first complete non-animal protein from a major crop in 50 years?
The scale of the undertaking was enormous, he added: “We have developed technology to commercialize the first complete non-animal protein from a major global crop in 50 years.
“We’ve got a vision of one day having breakfast with our kids and having four different things on the table with canola protein and we’ll say, yes, that was us…”
Partners ‘get’ the benefits of canola protein, but want to be sure production process is scalable
Potential partners did not need convincing about the technical or nutritional merits of canola protein, he stressed, but the economics of manufacturing it.
“The firms we are reaching out to [as potential partners]– they are in the proteins business – they know we have a good protein and they get the strength and size of the protein market.
“Their questions are all about the technology – does it work, is it scalable, which is why we commissioned the GEA report [a feasibility study from GEA Process Engineering recently demonstrated that there were ‘compelling returns’ to be made from canola protein].
Are food manufacturers interested in canola protein?
BioExx says that several major food manufacturers are experimenting with samples of its canola proteins, while a tie up with Century Foods International to develop a canola-protein-based sports nutrition range is also progressing well.
Delegates at the IFT Wellness 2012 conference were told plant-based proteins were a hot trend for 2012, while several exhibitors at Natural Products Expo West in Anaheim were also showcasing new plant-protein-based products and supplements.
Nutritional supplement giant Twinlab, which is developing a plant-based protein supplement as part of its new Clean Series range, is looking closely at canola protein, although marketing boss Marc Stover said no final decisions had been taken about which proteins to use.
Flavor, odor and functionality
BioExx’s hexane-free low-temperature extraction process means it can avoid the denaturing process that usually kicks in when proteins are exposed to high temperatures, which makes it harder to separate them from the meal and can reduce their solubility and functionality, claims the firm.
BioExx also says it has been able to improve the flavor and odor of canola proteins and decrease the ‘anti-nutrients’ that had historically hindered its use as a food grade material.
Q4 and full year results
In the fourth quarter of 2011 (three months to Dec 31) BioExx generated $1.2m of revenue from canola oil and canola meal sales at its Saskatoon plant versus $555,820 in Q4 2010. The net loss was $15.4m compared with $4.4m in Q4 2010.
Revenues for the year to Dec 31, 2011, were $5.3m versus $3.3m in the prior year. The net loss for the year was $30.1m compared with $14.9m for the prior year.