By Lynda Kiernan
Response Biotech has merged with Koch Biological Solutions to create Plant Response™ Biotech, Inc., a new venture that will focus on the innate immunity of plants, plant physiology, and nutrient use efficiency.
Founded in March 2008, PlantResponse™ began as a spin-out from the Universidad Politécnica de Madrid (UPM). Over the past 10-plus years the company has capitalized upon the know-how and techniques acquired through its experience in the agriculture space to grow to hold a worldwide exclusive license for its technology that enables for the identification and development of solutions that improve plant health and reduce the effects of stressors.
Koch Biological Solutions develops science-based, live microbial and biologically derived products that through various modes of action, perform directly on plants and their environment to improve crop efficiency, nutrient uptake, and yield potential.
Leveraging the complementary capabilities, assets, and offerings of each of the partners, Plant Response Biotech has developed a pipeline of several candidate products in the areas of drought tolerance and plant health that are approaching the commercial stage.
“These companies are naturally complementary, and it made tremendous sense to bring the two together and create real synergy,” said Tom Warner, chairman of the board for the newly launched Plant Response Biotech. “For example, both companies’ screening and validation platforms are complementary, with the ability to define mode of action and identify the resulting cellular response.”
Biological Traction
Plant Health and Nutrition (including biologicals) have raised the most equity capital of all segments, totaling $2.1 billion since 2014, according to John Campbell, managing director of Ocean Park, a boutique investment bank, and speaker at this year’s AgTech Nexus USA. In his recent GAI Gazette article: AgTech: Investment Trends to Watch in a Blooming Industry, Campbell highlights biologicals, including biopesticides, bioherbicides, and soil biostimulants, with particular interest. “In this class, we see fewer seed-stage rounds and increasing size of later-stage rounds,” he said. “Fully 40 percent of the Plant Health and Nutrition investment category have been for biologicals….”
The biologicals market includes biopesticides, biofertilizers, and biostimulants, which due to increased regulation and a growing focus on sustainable practices are commanding an increasing share of the market. According to a report by ResearchandMarkets.com, the agricultural biologicals market is estimated to have reached a value of $6.75 billion in 2017, and is projected to reach $12.86 billion by 2022, which translates to a compound annual growth rate of nearly 14 percent.
As the broad benefits and promising results of biologicals become more known, as well as their potential role as an impact investment, the category has been gaining traction and capital.
Just since September of this year:
~ ADM Capital Europe has led a EUR60 million (US$66 million) funding round for French biological crop protection company M2i Life Sciences, with participation from Eurazeo Growth, Tethys Invest, Creadev, and France 2i, which is managed by Raise Impact.
~ Pontifax Global Food and Agriculture Fund (along with an unnamed global investment fund) co-led an $85 million Series C for biological crop protection startup Provivi. Tybourne Capital Management joined the round as a new investor, and Kairos Ventures, Spruce Capital, Lanx Capital, and BASF Venture Capital all returned as existing investors.
~ and, Ospraie Ag Science (OAS) invested $3 million in Raleigh, North Carolina-based Plant Health Care, a provider of patented biological products that improve the health, vigor, and yield of major field crops such as corn, soybeans, cotton, and rice, as well as fruit and vegetable specialty crops.
A Global Presence
This new global company will have its headquarters in Raleigh, North Carolina; will have multiple operational and R&D locations in Hayward, California; and will have commercial and EMEA R&D operations headquartered in Madrid, Spain.
“Plant Response Biotech, being a Spanish company, has a strong presence in Europe, and Koch Biological Solutions is well established in the U.S. Together, this new company has global potential,” explained Warner.
As a result of this deal, Koch Biological Solutions will also be able to accelerate the advancement of its product pipeline through its tie-in with Plant Response Biotech’s commercial team, which is squarely focused on biologicals.
Tom Snipes, CEO of Plant Response Biotech noted, “We are excited to offer the marketplace 12 science-based products designed to mitigate abiotic stress, provide intrinsic yield improvement, enhance plant innate immunity and increase nutrient use efficiency.”
– Lynda Kiernan is Editor with GAI Media and daily contributor to the GAI News and Agtech Intel platforms. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@globalaginvesting.