BioHarvest Sciences Inc (CSE:BHSC) (OTCMKTS:CNVCF) (FRA:8MV) CEO Ilan Sobel is confident his Canadian company’s one-of-a-kind BioFarming technology will win over the American consumer.
In early June 2021, Sobel’s company entered the US market with its first nutraceutical product VINIA, bred out of its unique technology -- the first and only industrial-scale plant cell process capable of producing active plant ingredients without the necessity to grow the plant itself.
VINIA is a supplement based on the skin of red grapes, containing a rich complex of polyphenols designed to increase the dilation of arteries to improve blood flow, physical energy, and mental alertness.
The product, which also contains key compound piceid resveratrol at levels in each 400 milligram (mg) capsule that is equivalent to an average bottle of red wine, is available online in the US, the world's largest market for nutraceutical supplements worth some $53 billion. Nearly 80% of American households use dietary supplements.
“I'm very passionate about bringing our science to the American consumer,” Sobel said in an interview with Proactive. ”Now, this is a very challenging industry. We want to really set the standard of how dietary supplement companies are operating based on our break-through technology from BioFarming and based on the fact we bring science, and we bring efficacy to the consumer. And we also want to educate the consumer on what the product does to them and actually help them understand the importance of taking VINIA.”
To stress VINIA’s benefits, soon after its move into the US, the company announced that the flagship product is the only dietary supplement available in the country capable of taking on the body’s aging process.
BioHarvest said VINIA can both reduce the endothelin 1 enzyme (which causes hardening of the arteries) as well as boosting nitric oxide molecules (which relaxes muscles) to increase artery dilation and thus improve blood flow. Separately, the company is studying VINIA as an adjuvant therapy to treat Type 2 diabetes patients.
“In our clinical trial, we were able to demonstrate that all people who used VINIA for 90 days were able to increase the dilation of the arteries by at least 70%,” the BioHarvest boss said.
The company is aiming to be a disruptor in the US supplement market noted Sobel. “It’s all about branding and efficacy and communicating how we can change a consumer's life with the power of our science” he said when asked about differentiating BioHarvest’s products from the competition.
Tapping the power of e-commerce and social media
Sobel, who spent 18 years with Coca-Cola observing its marketing prowess, said BioHarvest isn’t selling VINIA through traditional retail stores but is using the power of e-commerce and social media to connect with customers in a highly personal, targeted way.
“We want to go directly to the consumer and have a one-to-one relationship and to be able to nurture that undefined loyalty that consumers have with the brand,” he said. “When you bring the big box retailer into it, you lose that one-to-one relationship with your consumer.”
BioHarvest first launched VINIA in 2017 in Israel, where the product is made. The company is currently expanding its manufacturing plant from 2 tons a year to 20 tons annually.
In Israel, sales of VINIA are soaring to all-time highs following the fourth quarter 2020 launch of its new direct-to-consumer e-commerce program.
For the first quarter ended March 31, 2021, the company reported a 17% sequential sales gain from the fourth quarter of 2020. The number of 1Q VINIA purchase orders increased by 45% versus the preceding quarter and the average dollar purchase amount for first-time customers was US$169. BioHarvest projects sales guidance of US$1.4 million to US$1.5 million for total sales in 2021.
When asked about the global expansion of the Superfruit business, Sobel said that for the next 12 months the VINIA division will focus solely on VINIA’s rollout in the US. After that, BioHarvest will move into the Canadian and European markets. The company is also eyeing Japan.
Entering the cannabis space
Meanwhile, BioHarvest has entered the cannabis space, applying its BioFarming technology to the industry. In June 2021, the company announced that it had achieved significant milestones towards commercialization, all based on the fact that it can grow cannabis trichomes in liquid media without growing the cannabis plant itself. The trichome is the micro-factory that produces cannabinoids, flavonoids, and terpenes -- the beneficial compounds that attract humans to the plant.
Sobel said the company intends to develop cannabis-based products -- using similar technology that produced VINIA in its bioreactors -- for the pharmaceutical industry that are far superior to organically grown cannabis. The company anticipates its first product rollout in 2022.
“We use the plant once,” Sobel explained. “Then we grow our cells in an aseptic environment. So there's no such thing as fertilizer. There’s no such thing as heavy metals that we have to worry about. There's no such thing as pesticides. There's no such thing as mold. This is like the purest form you can get.”
BioHarvest is also developing an olive oil-based product -- again using its BioFarming technology -- that it hopes to offer in late 2022 in Israel, bringing the benefits of a Mediterranean diet without the heavy calories that come with olive oil. In addition, the company has plans to make health products from pomegranates.
Going forward, Sobel said BioHarvest’s “maniacal focus” is on penetrating deeper into the US market, starting operations at its new 20-ton-per-year manufacturing facility, and researching and developing cannabis-based products. Further down the road, as part of its growth strategy, the BioHarvest boss does not rule out possible acquisitions and partnerships.
“We are very aware of what we can do with the power of our BioFarming technology,” Sobel said. “We have resources working on the future and will be ready to lean in. That probably could require some very unique business models based on collaborating with other companies who are drawn to certain industries that are trying to crack problems that they can only crack with our help.”
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