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Arcadia Biosciences CEO offers time line for getting new products to market

The three products nearing commercialization include the GoodWheat portfolio of improved wheat quality products in the Americas, HB4 Drought Tolerant Soybeans in Argentina and extended shelf life tomatoes by Shriram Bioseed in India
tomatoes
Arcadia's extended shelf-life tomatoes are licensed to Shrirarm Bioseed, a private seed company in India

Raj Ketkar, CEO of Arcadia Biosciences Inc (NASDAQ:RKDA) forecasts that three of the agricultural food ingredient company’s designed products will see their first sales in the next year to 18 months.

These crops include the company’s GoodWheat portfolio of improved wheat quality products in the Americas, HB4 Drought Tolerant Soybeans in Argentina and extended shelf life tomatoes by Shriram Bioseed in India.

“After years of development, we are excited and motivated to bring these products to our customers and are taking all the steps necessary to successfully launch these products,” said Ketkar while speaking on a call last week to discuss Arcadia’s third-quarter results.

Up first on Arcadia's agenda is its GoodWheat portfolio of non-GM wheat ingredients,which includes resistant starch or high-fiber wheat products, reduced gluten what products and other new traits under development. All of the GoodWheat products will be available in various classes of wheat, such as hard red spring, hard red winter and durum wheat.

“The number of prospective food companies testing or evaluating our GoodWheat expanded during the third quarter representing future distribution and sales into various geographies,” explained Ketkar on the call.

“Although exact timing to closure is difficult to predict, we are confident we will secure partners in two or three of these geographies over the next few quarters,” he added.

HB4 Soybeans are also nearing commercialization

Arcadia has also made considerable advances towards the commercial launch of its HB4 soybeans, which are being produced in Argentina as part of its joint venture with Bioceres Verdeca. Early in the fourth quarter, Arcadia received approval from Argentina’s regulatory authorities for the approval of HB4 drought tolerant soybeans stacked with herbicide tolerant traits.  The novel traits will help Argentinian soybean farmers by protecting yields under stressful climactic conditions without dispensing with weed control.

Arcadia is in the process of completing the dossier for the regulatory approval of its new variety of soybeans in Europe, which marks a major step in its progress towards commercialization of HB4 technology. It is also awaiting approvals from the US Department of Agriculture and from China for import approval of soybeans.

Once the required approvals are granted, the company expects to launch HB4 drought tolerant soybeans in Argentina.

Extended shelf-life tomatoes are set to hit market by end of 2019

Lastly, in another advance, the extended shelf life tomatoes, which were first developed by Arcadia and licensed to Shrirarm Bioseed, a private seed company in India, are also likely to see their first sales by the end of next year.

After years of breeding and development, Bioseed is set to introduce the technology that spawns the extended-shelf life tomatoes to farmers and the first sales are expected by the end of next year.

The technology allows the tomatoes to ripen on the vine before they’re picked, and the fruit retains its firmness during the picking, handling and transportation to market.

Arcadia will receive milestone payments and royalties on the sales of tomato seed, according to its agreement with Bioseed.

New revenue streams likely over the next 12 to 36 months

Speaking on the same call, Arcadia CFO Matt Plavan said the introduction of the company’s new nutritional ingredient products like GoodWheat and its advances in pushing to bring HB4 soybeans to market, would spark the onset and scaleup of revenues over the next 12 to 36 months.

The new revenues will be characterized as product sales or trait fees, depending on the arrangements with customers, according to Plavan.

With its new focus on bringing in revenues from products sales, Plavan said it was no longer strategically relevant for Arcadia to continue pursuing new contract research and government grant projects at the levels it has historically.  “And we expect these revenues to be lower this year, as our current contract research agreements and government grant projects conclude and/or are not replaced,” Plavan explained on the call.

Arcadia also recently announced that it will partner with Ardent Mills LLC, the largest wheat milling company in the US, to develop and commercialize new wheat varieties.

READ: Arcadia Biosciences teams up with Ardent Mills to develop and bring new wheat varieties to market

The first leg of the collaboration between the companies will focus on extending the shelf life and improving the flavor of whole-wheat products.

Using patented Arcadia trait technology, the storage life of whole wheat flour can be extended by slowing the enzymatic processes that reduce shelf life. Because milled flour from wheat carrying Arcadia’s trait technology oxidizes more slowly, it cuts down on the bitterness associated with most whole wheat products. Arcadia has received a US patent for this extended shelf life wheat.

“For a number of reasons, this is a very exciting milestone achievement,” said Ketkar on the call. “The project with Ardent Mills introduces this trait designed to extend whole wheat shelf life by slowing the enzymatic processes that produce bitterness in most whole-wheat products.”

Based in Davis, California, Arcadia develops high-value food ingredients and nutritional oils that aim to meet demand for healthier diets. The company’s agricultural traits are being developed to enable farmers to be more productive and minimize the impact of agriculture on the environment.

Contact Ellen Kelleher at [email protected]

 

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