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Algae ingredient supplier Heliae juggles exec suite, moves to accelerate agroscience, animal nutrition segments

By Hank Schultz

26-Aug-2014
Last updated on 26-Aug-2014 at 15:56 GMT2014-08-26T15:56:10Z

Heliae has a commercial-scale algae facility up and running in Gilbert, AZ. The company now wants to develop agroscience and animal nutrition ingredients.
Heliae has a commercial-scale algae facility up and running in Gilbert, AZ. The company now wants to develop agroscience and animal nutrition ingredients.

Algae ingredients producer Heliae has announced a shift in the company’s focus to place new emphasis an agroscience and animal feed initiatives. A management shakeup accompanied what the company billed as a “new phase of technical development and commercialization.”

In what has been called a planned move, the company announced that Dan Simon is stepping down as president and CEO, and current CFO J. Craig Johnson has been appointed interim-CEO. In addition, Eric Lichtenheld has been appointed as vice president of operations, replacing Adrian Galvez.

"Heliae has quietly come a long way in my four years at the company, from pilot through a demonstration phase to our first commercial facility, which has operated for almost a year. I'm proud of all that we've accomplished but there is much more to do," Simon said. "I will remain active in an advisory role and as a shareholder.”

AzCATI research

Heliae developed its hybrid algae technology first at the Arizona Center for Algae Research and Technology , or AzCATI, a public/private partnership located in Gilbert, AZ and associated with Arizona State University’s engineering school.  Heliae uses a blended phototrophic/heterotrophic approach to algae production, marrying the faster growth curves achievable via fermentation with the lower cost and scaling benefits of photosynthetic techniques.  The company developed a proprietary, scalable technology with astaxanthin as its first nutraceutical target. 

Heliae has had a commericial-scale facility operating in Gilbert, a southeastern suburb of Phoenix, for some months.  The company also announced its first major deal in the human nutraceutical space with an agreement for a joint venture located in Japan to develop a commercial algae production facility to produce astaxanthin .

Demand exceeds supply

But the company has had a strategy to develop other high value algal products in other realms, something that the refocus of resources and the new management structure is aimed to speed up.

“This next year will bring greater technical focus and scale and I'm eager to continue the momentum we've built since I joined the company three years ago. We have far more demand for Heliae's algal products than we produce today, so we are confident in our efforts to accelerate the commercialization of these additional production platforms,” interim CEO Johnson said.

Having many irons in the fire seems part and parcel of the algae space and is part of the DNA of AzCATI in particular. Much of the early development money at the institute came in to fund fuels research. Research at the institute in the years since has focused more on helping companies overcome their early technical hurdles to achieve marketable products and cash flow before the development money runs out. Even with investors as patient and deep-pocketed as those backing Heliae (scions of the Mars candy family), at some point profitability has to start to be visible over the horizon.

Multi-product strategies

There is a relatively long history with respect to research into algae at ASU. Numerous faculty on the Tempe campus  (ASU’s main campus in another Phoenix suburb) have a lot of experience on photosynthetic microorganisms.  We’re a little agnostic here. While a lot of money comes from fuels research, we are looking also at high value co-product and multi-product strategies,” said John McGowen, AzCATI director.

“Companies are sensitive to the idea of being able to make money early on. If you are diving right into fuels, the overall risk is high. If you can get more for your products (as is the case with value-added dietary ingredients) you can absorb more development costs,” he said.

“With each production run, we learn something new and continue to refine our technical parameters. Algae is not easy, but we are eager to enter this next phase and support the momentum that has been built over the last few years," said Frank Mars, co-founder and executive chairman of the board of Heliae. “We now look to our technical and commercial teams, led by Craig Johnson, to hit the next set of milestones on the path to commercialization and scale.”

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