November 19, 2010

 

Burcon NutraScience signs licence agreement with ADM

 

 

Plant protein manufacturer Burcon NutraScience has signed-on to draft a license agreement for agrifood firm Archer Daniels Midland (ADM) to market its soy protein products.

 

The Vancouver company said on Monday (Nov 15) that it had signed a non-binding letter of intent laying out their plans for a licence agreement, under which Burcon would licence its Clarisoy technology exclusively to ADM to produce, sell and market soy protein isolates.

 

As per the letter of intent, a deal, if reached, would license all Burcon's Clarisoy-related know-how and trade secrets to ADM for the products' manufacture and use.

 

Illinois-based ADM would also commit in the near term to engineering and design work on a Clarisoy production plant, and to pay Burcon a quarterly %age of net revenues as royalties.

 

The proposed royalty structure, Burcon said, would give ADM "financial incentive" to expand Clarisoy sales globally, offering a stepped-down royalty rate if ADM takes the product to markets beyond North America.

 

The letter of intent, which expires March 1, 2011, also commits Burcon not to shop the technology around to any other company while it negotiates a deal with ADM.

 

"As a leader in the global food ingredient industry, and one of the world's pre-eminent producers of soy proteins, ADM is the perfect partner" to commercialize Clarisoy, Burcon president Johann Tergesen said on Monday (Nov 15).

 

"We believe Clarisoy's potential in the global protein ingredient industry will be well served through the license structure as contemplated in the letter of intent we have executed with ADM today," he said.

 

Burcon's Clarisoy protein isolate is billed as 100% soluble, transparent, and low in viscosity in acidic beverages. Its use would allow beverage makers to produce transparent protein-fortified beverages such as juices, soft drinks, and sport drinks in a pH range as low as pH 2.5.

 

Clarisoy is also heat-stable in acidic beverages, Burcon said, which would allow a food processor to hot-fill with no loss of clarity or change in viscosity.

 

Clarisoy proteins also don't have a "beany" taste which Burcon said is typically associated with soy protein. That alone, in turn, would open up significant opportunities in the existing global soy protein market, Burcon said.

 

The two companies on Monday also announced a separate agreement that protects their interests regarding Burcon's other products in development while they work on this licensing deal for Clarisoy. Burcon and ADM have had a broader development agreement in place since 2003.

 

Burcon, which maintains lab and technical facilities in Winnipeg, is also developing a pair of rapeseed protein isolates, Puratein and Supertein, sporting unique functional and nutritional attributes.

 

However, Burcon and ADM said on Monday (Nov 15) that, "the two parties have chosen to focus on commercializing Clarisoy with its excellent nutritional and functional properties and unlike rapeseed protein, soy protein has global regulatory approval for use in food and nutritional products already in place."