BioGaia establishes US$18M investment arm, targeting double-digit growth

18 Mar 2021 --- Sweden-based probiotics player BioGaia has equipped a new subsidiary coined BioGaia Invest (BGI) with a total of SEK150 million (US$17.6 million).

The investment arm’s long-term strategy is to provide BioGaia with double-digit growth in the upcoming years.

BGI will enable investments between SEK5 million (US$588,000) to SEK15 million (US$1.7 million) in “exciting new companies” with ground-breaking diagnostics, delivery technologies services and products. 

“We only invest in companies that can directly contribute to our growth,” BioGaia CEO Isabelle Ducellier tells NutritionInsight.

Strides in skin and bone health
The first two companies to have benefited from BGI’s investment strides are AI dentistry specialist Boneprox and skin care developer Skinome Project, both located in Sweden. 

BioGaia Osfortis is formulated with vitamin D for bone health (Credit: BioGaia).“We have selected these companies carefully and their businesses connect to ours. We believe that they have the potential to contribute to the growth of BioGaia,” says Ducellier.

While BioGaia is currently not positioned to disclose its future investment plans, Boneprox and Skinome Project tell NutritionInsight what the BGI investments mean for their respective businesses.

Creating a roadmap together
Designing products that strengthen the skin’s natural microbiome, Skinome Project has received approximately SEK11.5 million (US$1.3 million) from BGI. 

Private equity company Spotchain and existing shareholders also participated in the issue.

“It is exciting to invest even more in research and innovation in partnership with BioGaia and start developing probiotic skin care together,” says Lydia Engholm, CEO of Skinome Project.

Currently, the two companies are developing a roadmap together and it is “too early” to share details on product concepts.

The Rich Emulsion face cream contains a patented postbiotic from lactic acid bacteria (Credit: Skinome Project).Bacteria bring on the billion dollar question
In Skinome Project’s view, there is a massively untapped potential for probiotics in the skin care sector. 

While still in its early stages, research in recent years has shown a balance in the skin flora is crucial for skin health. 

Skin conditions such as acne, eczema and rosacea appear to be linked to skin microbiome imbalance. 

“The billion-dollar question is how to find the ‘superstar bacteria’ growing naturally on our skin and is competing with the more pathogenic bacteria, risking to invade our biggest organ, our skin.” 

“We truly believe that there is a huge potential in using probiotic skintech solutions to foster a healthy skin,” Engholm maintains.

Investing in x-rays
With expertise in dentistry AI, Boneprox’s patented technology detects osteoporosis, among other bone degenerative diseases, through dental x-rays.

A symptom-free disease, osteoporosis requires a tremendous amount of health care resources from an already congested health care sector, says Peder Remman, Boneprox CEO and co-founder.

BGI has invested approximately SEK10.5 million (US$1.2 million) in Boneprox in a direct issue. The former owner of Boneprox, private equity company Backing Minds, is also a participating investor. 

“This investment will help us to reach new markets as well as enlighten people around the world about osteoporosis and what measures can be implemented to prevent fractures from happening,” explains Remman.

AI dentistry technology can detect degenerative bone diseases with x-rays (Credit: Boneprox).The funding will also help Boneprox develop new products, guided by BioGaia’s knowledge and market insights regarding the global public health concern. 

Huge potential in bone health sector
In connection with the investment, Boneprox and BioGaia Japan are joining forces to detect patients at risk for osteoporosis while providing BioGaia’s bone health product, BioGaia Osfortis, to subjects with low bone density. 

“We see a huge potential in the bone health sector. Part of the aging process, osteoporosis will continue to increase with the aging population and create a huge burden on health care,” states Remman.

“Osteoporosis is a bone disorder characterized by low bone mass causing bone fragility. Identifying patients at risk can significantly reduce the risk of fracture and early diagnosis is crucial to prevent high disease burden.”

NutritionInsight recently discussed the latest bone health ingredient trends in an industry roundtable featuring BioGaia’s research manager Jakob Axelsson.

By Anni Schleicher