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HEPI looking at pet market to fund nutraceutical development

By Hank Schultz , 07-Apr-2014
Last updated on 01-May-2014 at 21:11 GMT

Health Enhancement Products Inc., a Michgan-based development stage company with potential markets in nutraceutical products derived from algae as well as a personalized health measurement testing platform, has settled on animal nutrition as its closest-to-market revenue opportunity.

Health Enhancement Products Inc., a Michigan-based development stage company with potential markets in nutraceutical products derived from algae as well as a personalized health measurement testing platform, has settled on animal nutrition as its closest-to-market revenue opportunity.

The company has been developing its algal platform since at least 2007, generating promising data for the effects of the active molecules it has identified, but with mixed results as far as developing a marketable line of products is concerned. Andrew Dahl, CEO of HEPI, came on board in 2012 after working as a consultant for the company in part to rationalize the process of product development.  And in that vein, the company has re-emphasized its focus on animal nutrition as a potential source of revenue, something that the company has yet to achieve.

Pet care opportunity

The company’s nutraceutical ingredients have shown positive effects in countering bovine mastitis, a condition that suppresses milk production in dairy cattle. The company also has a pilot project underway to identify opportunities in pet care.

“What we have found is that there enough opportunities in improving animals’ lives that we are focused on this for the moment.  We are finding that our algal biomass added to feed is effective in managing osteoarthritis in dogs.  The canine segment is a $300 million market segment all by its lonesome.  It’s the largest of the companion animal supplement segments,” Dahl said.

The company’s nutraceutical developments focus on “totally new small molecules with amino acid or amine-type structures” derived from a phototrophic strain of algae.  After first cultivaing its propritary algae strains itself, HEPI has entered into an agreement with Arizona State University (center of much algal research).  ASU’s Arizona Center for Algae Technology and Innovation (AzCATI) is developing pilot-sized bioreactor production methods and is helping to identify the most efficient harvesting, dewatering and extraction technology for its proprietary strains at a commercial scale to cultivate its strains in bioreactors located that could be marketed as they are (cleaned, sterilized, dewatered biomass) or as high-purity extracts.  

While HEPI’s initial focus is on animal nutrition, the medium-to long term focus will be human nutrition, Dahl says.

“It’s further from market in the sense that we have to get some reveneus or more capital funding.  We intend to generate revenues from the animal side to push the human development,” Dahl said.

Testing initiative

In a parallel developement, HEPI is in preliminary testing on its Wellmetris health assessment platform, which the company acquired in August, 2013.  In the intervening months, the company has redesigned the platform (which evalutes health via biomarkers in urine) to greatly lessen the ‘ick’ factor.  Chief among these moves was to revamp the way in which the sample is collected.  The company’s new design uses a wick which is introduced into the urine stream, which can then be withdrawn back into the test unit without having to be handled by the patient or customer.  For test kits designed for use in clinics, pharmacies or at health fairs, the design provides sealing biological barrier so test administrators won’t come into contact with a particpant’s biological material.

“They don’t want to touch a urine cup, much less a test strip.  We have had to come up with a sleeve with a sleeve to provide a biological break between the test cartridge and the person administering the test,” Dahl said.

For home use, the company is developing a cheaper version without the added barrier.  The test provides the added wrinkle of being able to send data to a mobile device such as a cell phone that can read the results via an app.

“The cartridge has its own single use sensor and its own power supply,” Dahl said. “It can sense the electrical pattern of the chemical reaction and that’s all we need.”

The acquisition of the assests of Wellmetris made sense, Dahl said, because it was available in bankruptcy at a good price, and the lipid peroxidation measures the test was based on were similar to what HEPI has been using to evaluate its nutraceutical molecules, so the synergy was clear.

“The biomarkers that they were working on in Wellmetris are the same biomarkers we have used to validate our ingredients.  We now have a testing platform that will substantiate teh action of our ingredietns.  Imagine if you are taking a supplement, hopefully ours, wouldn’t you like to know that it is working?” Dahl said.

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