- Develops healthier specialty food ingredients and food crops using gene-editing technology
- Unlike genetically modified crops, Calyxt products contain no foreign DNA
- First to launch a gene-edited high oleic soybean food product focused on consumer health in the US
What Calyxt does:
Calyxt Inc (NASDAQ:CLXT) is a plant-based technology company which is developing healthier specialty food ingredients and food crops using gene-editing technology.
Founded in 2010, the Roseville, Minnesota-based company is doing what farmers and botanists have been doing for hundreds of years: choosing the best crops and breeding them to make higher-yielding plants. It accelerates that process with its TALEN gene-editing technology.
Developed in part by Calyxt co-founder and chief science officer Dan Voytas, Transcription Activator-Like Effector Nuclease — better known as TALEN — is an advanced breeding technology that allows for precision targeting of existing genes within a plant’s genome. That targeting allows Calyxt scientists to select desired characteristics, and precisely engineer beneficial crop traits, accelerating breeding at a fraction of the time it would normally take.
Unlike genetically modified (GMO) crops, Calyxt products contain no foreign DNA. The company simply harnesses the unique characteristics that naturally exist in the plant.
Next, it gets the seeds to growers who are a part of its premium producer program. The crops are traceable right to the county in which they were grown, thanks to the company’s Identity Preserved Program that tracks seeds all the way to the final product.
The company engages in the development of products which include high fiber wheat, alfalfa, reduced browning potatoes, and high and low linolenic soybean products.
How is it doing:
Calyxt is expanding its product portfolio with next-generation legumes and plants including high oleic low linolenic (HOLL) soybean, developed using the company’s proprietary TALEN gene-editing technology.
In June, Calyxt told investors that the plan to bring its new HOLL soybean to market had been boosted by the United States Department of Agriculture (USDA) classifying it as a as a “non-regulated article.” The decision not to regulate the company’s new HOLL soybean will put it on track to be launched as early as 2022, said the company.
Meanwhile, Calyxt is planning to launch hemp this year and an improved digestibility alfalfa in 2021.
In May, the food and agriculture company posted first-quarter results that saw revenue leap 1,414% year-over-year on the back of a favorable product mix driven by high oleic soybean products, including oil and meal. For its first quarter ended March 31, 2020, Calyxt posted revenue of $2.4 million, an increase of $2.2 million from the first quarter of 2019.
The spike in revenue was driven by volume growth and high oleic soybean meal which made up 87% of the income. Most of the oil revenue came from a world-class customer, said the company. Gross margin during the quarter was a negative $1.5 million, a decrease of $1.6 million from the first quarter of 2019, reflecting the higher costs experienced at this early stage of commercialization of high oleic soybean products.
Significantly, Calyxt extended its cash runway with cash and equivalents including short term investments and restricted cash totaling $47.4 million as of March 31, 2020.
Calyxt recently launched Calyno, a premium high oleic soybean cooking oil, the company’s first commercial product, through its new website calyno.com. The high oleic soybean is grown by Midwest farmers to provide the benefits of a heart healthy oil. The soybean product is allergen and gluten free with zero grams of trans fat per serving and 20% reduced saturated fat. That earned the oil a qualified heart health claim from the US Food and Drug Administration. Calyno offers lower absorption than other oils, which means greater stability and a longer fry life than conventional vegetable oil.
Significantly, Calyxt is the first company to commercialize a gene-edited food product focused on consumer health in the United States.
Looking ahead, the company expects to meet the demand for its soybean oil, by nearly tripling its contracted soybean acreage to more than 100,000 soybean acres with US farmers compared to the 2019 planting. The company expects to have a 25% market share of all soybean acres planted in the US in 2020.
In April, Calyxt licensed a new breakthrough technology from the University of Minnesota, invented in a lab run by Calyxt cofounder Dan Voytas, that will enable the company to significantly reduce the time needed to develop traits in certain crops. It could potentially reduce the time needed to edit plants to “a matter of months rather than years,” according to the company. The new technology could increase the speed at which popular products like better-tasting plant proteins reach consumers faster.
Calyxt has said it expects to launch at least six product candidates between now and 2024, starting with a hemp product this year. The following years will see the launch of an alfalfa product in 2021 (through a collaboration with S&W Seed Company) and a high-fiber wheat product targeted for early 2022.
- Near-term revenue growth potential from planned launch of hemp in 2020 and improved digestibility alfalfa in 2021
- Momentum from the debut of Calyxt’s premium soybean cooking oil Calyno, the company’s first commercial product
- The successful commercial launch of its high oleic soybean products proves there is demand for gene-edited products
- On a long-term basis, Calyxt will gain traction from geographically expanding its soybean meal customer base and sample testing with large consumer packaged goods companies
- There’s massive upside potential as the company makes important additions to its growing portfolio of commercial products
- Gaining momentum from USDA confirmation that Calyxt’s high oleic low linolenic soybean is not a regulated article
- On the tech front, sustained improvements to its gene-editing technology suite will yield profits
- By leveraging its TALEN technology, Calyxt has tremendous ability to address market opportunities in food tech and agriculture
What the boss says:
In an interview with Proactive, Calyxt CEO Jim Blome said: “Our technology and robust scientific team are what allows us to maintain a competitive edge in the gene-editing space."
"In the near-term, we expect to launch our first hemp product – improved plants to address key problems facing hemp growers – marking the launch of our second commercial product. We expect the velocity of our revenue opportunities to accelerate as we build up a robust portfolio of commercial products addressing several different markets,” he added.
Contact the author Uttara Choudhury at [email protected]
Follow her on Twitter: @UttaraProactive