ByHeart lands US$90M to disrupt infant formula market
27 Jul 2021 --- Baby nutrition company ByHeart has secured US$90 million in series B funding, which will accelerate the road to market for its infant formula. D1 Capital led the funding round to support ByHeart’s impending formula launch and further the company’s innovation pipeline of mother and baby products.
It builds on a series A funding round which landed the company US$70 million in April 2020.
The company says it is “committed to modernizing the entire nourishment continuum from pregnancy through early childhood with next-to-nature quality, leading nutrition science, and ingredient transparency.”
Pending FDA approval
The funding comes at the heels of a multicenter clinical trial for its formula recipe – made entirely from scratch – that successfully met all of its endpoints. This is a “critical final step” in submitting ByHeart’s new infant formula notification to the US Food and Drug Administration (FDA).
It says it is the first new brand to include a breastfed reference arm in its clinical trials. This “significant and elective addition” will eventually yield additional data.
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ByHeart met all its endpoints in a multicenter clinical trial for its formula recipe.
ByHeart seeks to become the fourth fully integrated, FDA-registered, US-based infant formula brand in the country.
“Five years ago, we set out to build a company that would transform baby nutrition with products and resources grounded in breakthrough nutrition science and breast milk research,” says Ron Belldegrun, co-founder.
“When we discovered that much of the industry was still relying on existing research as opposed to conducting new, more comprehensive clinical trials, we knew that true innovation would require starting from scratch and building entirely from the ground up.”
Challenging big players
According to the company, there is currently a limited supply chain in the infant formula space as only four companies in the US produce infant formula – three of which own approximately 90 percent of the market.
“Three companies have dominated the infant formula space for decades and new companies that have entered the market have used the same third-party manufacturer who handles end-to-end production and manages supply chain and ingredients.”
Creating a formula recipe that incorporates modern advancements in baby nutrition beyond the industry standard requires ownership of the entire manufacturing process and running a new clinical trial.
Due to this high barrier to entry, breast milk research and nutrition science have outpaced innovation, the company supports.
Investment roadmap
The series B funding also included continued participation from OCV Partners, Polaris Partners, Bellco Capital, Two River and Red Sea Ventures – all of whom also invested in ByHeart's series A – as well as new investment from AF Ventures.
“We invested pre-market, earlier than we typically invest, in part because we believe the ByHeart team has created a differentiated formula product that can deliver compelling benefits to babies,” notes Dan Sundheim, Founder of D1 Capital Partners.
In similar moves, biotech company Inbiose applied for Generally Recognized as Safe (GRAS) approval by the FDA for four of its human milk oligosaccharides (HMOs) for infant formula applications.
By Kristiana Lalou
