More than a decade after developing a natural health compound that boosts the immune systems of livestock, Ottawa-based life sciences company Avivagen is hoping a new version of the product aimed at humans will help it finally achieve its long-anticipated market breakthrough.
With the new product set to debut on Amazon in the U.S. next week, CEO Kym Anthony believes Avivagen – fortified by millions of dollars in new financing – is about to have its day in the sun.
“The company has turned the corner from being a research-driven company to being a successful commercial enterprise,” he says.
OBJ360 (Sponsored)
Philanthropy can be about more than doing something positive for others. It can also be a way of righting old wrongs. When Patricia Saputo was in her early 20s, she
World Junior Championships set to boost Ottawa’s economy and global reputation
The World Junior Championships will kick off in Ottawa in December, bringing tens of millions of dollars of economic activity to the city, as well as a chance for local
The 20-person firm, which trades on the TSX Venture Exchange in Canada and the OTCQB Venture Market in the U.S., currently focuses on supplements aimed at replacing antibiotics in cattle feed.
The company announced Wednesday morning it has raised $7.5 million through a bought deal offering underwritten by Toronto-based investment group Bloom Burton Securities.
Under the agreement, Bloom Burton will buy 15 million units in Avivagen at a price of 50 cents each. The units are a combination of new shares in the publicly traded firm as well as future purchase warrants that must be exercised within three years of the deal’s closing date, which is expected to be in mid-February.
Offering ‘upsized’ from $5M
The deal is a first for Avivagen. The company has raised millions of dollars over the past few years through the private sale of stock, but those transactions required Avivagen to back its stock offering with other forms of securities.
This time around, Bloom Burton is assuming all the risk, banking that it will be able to resell the shares to the public and earn a tidy sum on commissions. The investment firm actually “upsized” the offering to $7.5 million from its original value of $5 million after a surge in interest from potential buyers.
Anthony sees that as a strong signal that the market is warming to Avivagen.
“There’s enough interest and enough following on the street that they felt comfortable enough to buy the (stock) knowing that they could resell it,” he explains. “It’s hugely encouraging.”
Next week, the new supplement designed for people will officially be launched south of the border in a joint venture with Toronto-based supplement manufacturer Mimi’s Rock Corp., which sells under the Dr. Tobias brand. In addition, the two companies are partnering on a line of dog treats that are fortified with Avivagen’s immune booster.
The new funding came a day after Avivagen announced it had secured an order for six tonnes of its flagship livestock product, dubbed OxC-beta, from a customer in Mexico. That followed a 10-tonne order from another Mexican client last fall.
The product is now approved for use in animals in Brazil, Malaysia, Mexico, the Philippines, Taiwan, Thailand and the U.S. China is expected to give OxC-beta the green light shortly, opening up another massive market for Avivagen.
“Where we are approved today, we’re making real traction,” Anthony says, adding the company expects to see “a pretty significant and dramatic increase in overall orders” in the next 12 months.
Natural antioxidant
Avivagen’s products are derived from carotenoids, organic pigments produced by plants and algae that give fruits and vegetables such as bananas, carrots and tomatoes their bright colours.
Various studies have suggested carotenoids can help reduce the risk of various types of cancers as well as conditions such as Parkinson’s disease in human beings. Avivagen officials say they’ve conducted dozens of tests that prove the natural antioxidants boost the immune systems of livestock, helping warding off disease without the use of antibiotics – a key selling point at a time when health experts are calling the rise of antibiotic-resistant “superbugs” a simmering global health crisis.
Anthony says the new supplement will provide a similar benefit for humans. He says it will “prime the immune system” by activating cell receptors that act like “sentries on top of a wall that are keeping a lookout for bacteria entering the body.”
Founded in 2005, Avivagen has racked up more than $30 million in losses as it poured hefty sums into R&D while waiting for its products to gain regulatory approval around the world. But Anthony says he expects the company to grow “very rapidly” in 2021 as more countries come on board and it begins to roll out its products for people and pets.
“We’ll see how long it takes to build awareness,” he says, adding he believes it’s only a matter of time before the firm is cash-flow positive.
“We have eyeballs on that,” Anthony says. “I can’t tell you this quarter or that quarter, but it’s coming.”
