Ganeden Sells BC30 Supplement Rights to Schiff

MAYFIELD HEIGHTS, OhioGaneden Biotech Inc. received a solid capital infusion to focus on the potential of probiotics in high growth markets, after Schiff Nutrition ponied up $40 million for the exclusive worldwide rights to the GanedenBC30® probiotic technology for use in the over-the-counter (OTC) and dietary supplement markets. The acquisition also includes the Sustenex® and Digestive Advantage® brands under which BC30 is currently sold. Schiff expects the transaction to increase its net revenues and be accretive to earnings for the new fiscal year, ending May 31, 2012; the assets and brands acquired by Schiff generated net revenue of approximately $17 million for the year ended Dec. 31, 2010.

GanedenBC30 is protected by an extensive intellectual property (IP) portfolio, which expanded to 100 domestic and international patents last fall. Its stability in manufacturing and different delivery systems have allowed its use in supplement forms beyond tablets and capsules into chews and gummies; among the newer applications have been canine supplements and thin strips. Ganeden has also been very active on the food/beverage side, and even received the 2009 SupplySide Scientific Excellence Award for its work with retailer Red Mango on a line of iced teas fortified with probiotics.

Marshall Fong, vice president of marketing, Ganeden, told INSIDER the timing was right for the company to hand off the supplement brands, which he said boasted a compound annual growth rate (CAGR) of 18.4 percent over the last three years. Instead, he said, Ganeden will focus on higher growth and higher margin categories, including the food/beverage market, animal nutrition and even clinical nutrition/medical foods, as the company has invested in clinical research in areas such as HIV and cardiovascular health.