DSM cornerstones €10m funding round for Phynova’s glycemic control ingredient
13 May 2020 --- Royal DSM’s investment arm, DSM Venturing is a cornerstone investor in a €10 million (US$10.8 million) funding round for Oxford-based life science company Phynova. The latter is working toward fulfilling significant commercial orders for its Reducose technology in Europe, China and North America. The ingredient addresses the global issue of excessive blood-glucose levels, which can lead to severe conditions such as diabetes, obesity and cardiovascular disease (CVD). It holds a wide range of applications such as in supplements, functional foods and beverages for those seeking to modulate glycemic index.
“DSM Venturing continues to invest in innovative start-ups and scale-ups through COVID-19. As a company, we believe in the crucial role of bright science to overcome this pandemic and the purpose-led ethos that runs throughout DSM is clear in these ‘business as unusual’ times,” Rob Beudeker, Investment Director for DSM Venturing, tells NutritionInsight.
“The funding will be primarily used to scale up the business. We need more capacity to make more products. A lot of the money will be used in making more stock to supply our customers, which is quite exciting as we have almost US$4 million worth of orders in place already,” David Lee, Chief Financial Officer at Phynova, also tells NutritionInsight.
Last year, DSM and Phynova signed a global distribution and collaboration agreement for Reducose. The move sought to further develop the value proposition, including the science and associated health benefits of reducose, as well as the technical application in various delivery formats. The cooperation with Phynova is set to strengthen DSM’s portfolio with regard to its solutions in the heart health and glycemic control space.
“We collaborate with DSM on research and certain regulatory matters, as well. These are the little things that help us along the way, beyond the distribution agreement that we have established with them. We would love to further collaborate with DSM, but that is something to look forward to in the future. As far as more funding is concerned, there are currently no plans, but as we scale up, we may need more capital,” adds Lee.
Reducose addresses the issue of excessive blood-glucose levels, which can lead to conditions such as diabetes, obesity and cardiovascular disease.DSM Venturing is joining a list of current shareholders including Unicorn Asset Management. Moreover, Beudeker will be joining Phynova’s Board, and also notes the current funding round is still open. Notably, DSM Venturing currently has over 35 companies in its portfolio.
Regulating blood glucose
Diabetes is a rapidly growing health issue, with an estimated 425 million adults affected globally, according to Phynova. The incidence of pre-diabetes is even higher, with an estimated one billion adults affected globally. However, governments are actively working to increase consumer awareness about healthy nutrition and reduction of high-glycaemic foods. Meanwhile, there is a new generation of non-invasive wearable devices coming to the market that will be able to continuously monitor and make people aware of their blood glucose status.
Reducose can help as it is a patent-protected ingredient, which is easily added to foods and drinks at the manufacturing stage or taken as a food supplement. It is derived from white mulberry leaves and is part of Phynova’s stable of natural healthcare products developed from active compounds found in plants.
“It is a water extract, which means it can be used safely in foods and in small amounts. Roughly 250 ml in a meal or a supplement before a meal is sufficient for it to be effective. It doesn’t have a strong flavor and it doesnt change the formulation of a food, so you can use it easily in food applications. It can also be added to functional foods to lower the glycemic index, if the formulator is seeking that and it can also be added to beverages,” explains Lee.
Reducose also reduces the impact of high-glycemic sugars, as well as other carbohydrates, on the body. It does this by reducing the absorption of sugars and other carbohydrates in meals by up to 40 percent and has undergone rigorous safety and human efficacy testing. Diabetes and pre-diabetes are rapidly growing health issues with an estimated one billion adults affected globally. Converging societal trends, including public awareness of the impact of sugar on the body and wearable technology to measure blood glucose, are fueling a huge market opportunity.
“It has a host of benefits for diabetic and healthy people as well. So it is not a treatment of course, but it is helpful for people who worry about glycemic control,” Lee states.
“Our product is actually manufactured in China and the country is going back to work now, so there are no supply hurdles there. In addition, because there are no trading complications either with the US, Europe and China for supplements, we remain unaffected and carrying operations normally,” he adds.
The company has other products in its portfolio, however. Phynova Joint and Muscle Relief Tablets, which are based on the Chinese plant-remedy Sigesbeckia, became in 2015 the first traditional Chinese medicine product to be licensed by the UK’s Medicines and Healthcare products Regulatory Agency (MHRA) as an over-the counter (OTC) product under the EU’s Traditional Herbal Medicinal Products (THMP) Directive.
“The news affirms that Phynova’s developing position in the market with its unique, proprietary plant-derived products.The interest in science-based natural products for maintaining and improving health already has a significant worldwide market and is set to grow substantially,” concludes Robert Miller, Chief Executive Officer? of Phynova.
By Kristiana Lalou
