OptiBiotix Health PLC (LON:OPTI) Chief Executive Officer Stephen O’Hara caught up with DirectorsTalk for an exclusive interview to discuss their new development agreement with Royal DSM
Q1: Stephen, you’ve just put out some exciting news, can you tell us a bit more about the RNS issued and your agreement with DSM?
A1: Yes certainly, I can give you some colour on the agreement within a limited confidentiality. The first thing to say is we’re really excited and pleased to have this agreement with one of the world’s leading suppliers of nutritional ingredients so the RNS shows that the agreement is for joint development of new products. So we’re creating new products with DSM based around our Optibiotic sugar platform and when these new products are developed, they’re linked to royalty payments on sales of duty products so this really is a significant agreement and it demonstrates the industry validation of our technology, sugar platform and it really builds on the progress we made on our sugar platform over the last 12 months or so. Investors probably arent aware that the development programme of the sugar platform has three arms to it so we’re developing sugars that can modulate the human microbiome and produce a health benefit, we’re developing sugars that can increase the growth rate of a particular species of bacteria and the third element is activating sugars that have a particular sweetness out of the core sweet-biotix platform. So this agreement builds on the first two aspects of that and we’ll be creating sugars that can change the microbiome and it really is a significant agreement with a global player and we hope it will build into substantial future revenues.
Q2: So what kind of products do you see coming from the agreement?
A2: Well OptiBiotix Health got the agreement with the world’s largest provider of nutritional ingredients so we’re looking to create nutritional ingredients with DSM and they’ve got a range of product opportunities, they break down potentially into two areas. First of all, products which include ingredients so it’s ingredients using our sugar platform which selectively modifies the microbes in the human gut so we’re changing individual human microbiome and by doing that we can change an unhealthy microbiome to a healthy one so that’s the first area, this is using our sugars in their own right. The second is sing our sugars in combination with existing products where those products could be for example yoghurts or a probiotic supplement, the probiotic supplement market is really a very large market, it’s about $46 million, and we could see in the near future our sugars being used as a supplement with them, the probiotics, to enhance their benefits.
Q3: How does this fit in with Optibiotix Health Plc overall strategy?
A3: Well our strategy is to build a number of opportunities with a range of partners and those partners are typically food, health and wellbeing companies or pharma companies and this agreement fits into that very very nicely. It means that we’ve had over the last just more than 12 months 6 agreements, 3 with large global partners and we now have 3 deals with 3 global partners across all our technology platforms. So we’ve made substantial progress in the last 12 months with our technology and commercially we’re striking deals with big global partners and these commercial agreements, a number of which are for 6 figure sums, really demonstrate the confidence from the industry in the company and its technology platforms and the income we get from these deals make a significant contribution to our running costs, our development costs, but more importantly they create a route to market with established bands with the potential, across all these companies that we’ve created partnerships with, to generate multiple revenues streams in the future.
