Biotechnology companies sign definitive merger agreement

USA based companies Cellana, Inc. and PhytoSmart Inc., have signed a definitive merger agreement. The combination is expected to accelerate the commercialization of sustainable algae-based consumer products and strengthen the foundation for future large-scale expansion for alternative / plant-based proteins and bioenergy applications.

Biotechnology companies sign definitive merger agreementCellana, Inc. and PhytoSmart Inc., two companies in algae-based products and biotechnology, have signed a definitive agreement to merge the two companies. Upon closing of the merger, PhytoSmart will become a wholly owned subsidiary of Cellana. Deena Sisitsky, CEO of PhytoSmart, will join the Cellana Board of Directors and will lead the Consumer Products activities for the combined company under the PhytoSmart™ brand name.

According to the announcement, the combined company will benefit from an expanding portfolio of commercial products initially in the fast-growing Omega-3 supplement and sustainable nutrition sectors. PhytoSmart’s first commercial product is a whole algae pet supplement currently being sold via Amazon and through the PhytoSmart corporate website, in addition to select pet stores throughout the United States.

COMPLEMENTARY EXPERTISE
PhytoSmart, based in Maine, USA, has a long-standing history of innovation in heterotrophic algae production based on its patented Sterile Plastic Algal Growth System (SPAGS) production technology. The SPAGS production technology is reportedly centered around the use of small, modular, low-capex, and highly scalable vertical bags and has been optimized for the commercial production of Omega-3-producing algae strains.

PhytoSmart’s cost-effective, sustainable production methods have made it one of the leaders in delivering high-quality algae-derived nutrients, especially for applications requiring precision and purity. PhytoSmart’s first commercial product, a DHA-Omega-3-containing whole algae pet supplement product, exemplifies this commitment to high-quality, high-value products and processes, according to the statement.

PhytoSmart and Cellana have explained they will jointly focus in the near term on expanding the number of different product offerings within the PhytoSmart line of pet supplements and accelerating the marketing and sales of these initial pet supplement products. Once established in the pet market, PhytoSmart plans to produce supplements and functional food product offerings for humans.

Cellana, based in San Diego, USA, and with historic roots in Hawaii, has demonstrated the robust ability of its patented ALDUO™ photosynthetic production technology to grow highly diverse, non-GMO algae at commercially significant biomass yields. Since 2006, Cellana has successfully produced over 30,000 kilograms of algae biomass using its hybrid production technology of large-scale photobioreactors coupled with large open ponds.

Cellana’s grant and academic partners have also grown Cellana’s lead EPA-Omega-3-producing algae strain outdoors at industrial scale in multiple locations in the United States, including in Arizona, California, Florida, and Georgia, thereby demonstrating its versatility in diverse environments. Historically, Cellana has focused its technology platform and business model on deploying large-scale algae biorefineries, from high-value Omega- 3 supplements and pharmaceutical ingredients to sustainable, plant-based proteins for large-scale food and feed applications, with sustainable algal crude oil as a coproduct for fuels and chemicals applications, the announcement states.

UNITING STRENGTHS TO DRIVE A SUSTAINABLE FUTURE
By merging PhytoSmart’s leadership in heterotrophic algae production for high-value applications that initially focus on Omega-3 DHA nutrition and Cellana’s expertise in photosynthetic EPA production for a range of applications, the combined company will offer a comprehensive suite of algae-based solutions that address both high-value niche markets and large-volume industries. Leveraging their respective strengths, the combined company aims to accelerate the development of a portfolio of sustainable, nutrient-rich, and energy-efficient products that meet increasing global demand for clean, non-GMO, plant-based products, the companies point out.

“We are thrilled to join forces with Cellana, whose complementary production technology and multi-product business model will allow us to broaden our portfolio and reach new markets,” said Deena Sisitsky, CEO of PhytoSmart. “The combination of PhytoSmart’s specialized focus on DHA-producing algae for high-value applications using small, inexpensive, modular, scalable production technology with Cellana’s demonstrated strength in EPA-producing algae using large-scale production technology for both high-value and high-volume products positions us in the vanguard of algae biotechnology and algae-based nutritional products with global ambition and capabilities.”

Martin Sabarsky, CEO of Cellana, stated: “The total addressable market for pet supplements alone is over $2 billion globally and growing rapidly, and the market for Omega-3 supplements for humans is more than $8 billion. Our combined company’s ability to deliver vegan, sustainable, whole algae, non-GMO, non-fish-based Omega-3 supplements represents a potential game-changer in the pet and human supplement sectors alone.”

“PhytoSmart’s expertise in fermentation-based production of high value, whole algae products to build what we expect to be a highly profitable company in the near term significantly augments and enhances Cellana’s ability to attract new business-to-business partners and expand to large-scale commercial production as a subsequent step,” Sabarsky added.

“This merger represents a perfect alignment of our two companies ’respective strengths. Together, we’ll be able to integrate our technologies to increase consumer product offerings, scale up production, and bring innovative algae-based solutions across diverse sectors, from the world’s most sustainable pet and human nutritional supplements to large-scale plant-based proteins for aquaculture, animal feed and human food, to Omega-3 pharmaceutical ingredients, to clean energy,” Martin Sabarsky concluded.