Advances in natural blue: Fermentalg-DDW partnership to expand microalgae portfolio

22 Jun 2020 --- French microalgae player Fermentalg has signed a multi-year technological, industrial, and commercial development agreement with the US industrial group DDW to bring Blue Origins, the natural blue color developed by Fermentalg, to market. The move is expected to substantially strengthen Fermentalg’s financial resources to complete its strategic development plan as consumers lean toward naturality, healthful ingredients and environmental protection. As well as this, Fermentalg has secured financing of at least €19 million (US$21.2 million) until the end of 2022 to fund the industrial scale-up of its product portfolio.

“We are very pleased to announce two major advances in Fermentalg’s development,” says Philippe Lavielle, Fermentalg’s Chairman and CEO. “The strategic agreement entered into with DDW will enable us to accelerate the development and marketing of Blue Origins, a natural colorant that outperforms spirulina and thus creates a new standard in the food industry, particularly in the beverage segment. This superior product came out of the same platform as Kalveā, our algae superfood for athletes and seniors.”

“The food industry has been asking for a natural blue for quite a while, but the available solutions derived from spirulina had some shortfalls in technical specifications and supply chain robustness. Fermentalg’s know-how in the selection and the cultivation of micro-algae by industrial fermentation brings about a new product with improved pH and temperature stability, and a much more scalable supply chain. The partnership with DDW validates our technology and will act as an accelerator of our market penetration,” Lavielle tells FoodIngredientsFirst.

Natural ingredients boom
The demand for natural and clean label ingredients is expected to continue, according to Lavielle. “Consumer trends are already well established toward more naturality, healthy foods and environmental protection,” he adds. “The health crisis that we have just gone through has created its share of difficulties and uncertainties. Despite this, I am more convinced than ever of the role that Fermentalg will play in the coming years in responding to the increasing demand for healthy natural and environment-friendly food,” asserts Lavielle.

Microalgae are proving to be one of the most promising sources of natural food colors, especially when grown by fermentation, which allows a much better safety profile and an improved environmental footprint. Fermentalg’s technology platform is suited to produce such innovations, highlights Lavielle, stating that “we thought that a natural blue color would be a good start to demonstrate our capabilities. Natural blue from microalgae will be a sustainable alternative to current solutions.”

All applications will be impacted, notably the beverage, dairy and confectionery segments, he adds.

All applications segments will be impacted by the scale-up, notably the beverage, dairy and confectionery segments, says Fermentalg.Promising scale-up
At the same time, Fermentalg has been able to secure new financing, which will enable it to meet the development needs of microalgae and continue growing on the omega 3 markets with its DHA Origins and to finance the industrial scale-up of the Kalveā product line.

“Fermentalg’s technology platform has already delivered one of the premium algal omega 3, which we are now commercializing and for which we have signed commercial deals with world-leading experts in the omega 3 dietary supplements,” continues Lavielle. “We are looking forward to pursuing our technology investments in the field of natural colors and also in our algal protein platform, which holds great promise for the segment of sports nutrition and healthy aging.”

“We are eager to find industrial partners willing to contribute their expertise in the field of plant proteins, and willing to unleash the vast potential of microalgae as an excellent source of highly nutritive proteins,” he further notes.

The agreement between Fermentalg and DDW sets forth the terms and conditions of a general development and marketing plan for phycocyanin-based products derived from the microalgae Galdieria sulphuraria.

Phycocyanin, for which worldwide demand is growing significantly, is the only natural blue pigment used in human food that offers an alternative to synthetic dyes.

In 2016, the US Food and Drug Administration (FDA) authorized the use of phycocyanin extracted from spirulina, a cyanobacterium (blue algae), as a coloring agent for candies and beverages on the US market. However, until now, these spirulina extracts have not satisfied the performance criteria (quality, stability, and yield) necessary to expand its use, which severely limits its commercial potential.

Fermentalg has also signed a €12 million (US$13.4 million) equity financing line with Kepler Cheuvreux for over two years.

Fermentalg’s innovation, for which several patents have been filed, opens up a unique route to the large-scale production of new phycocyanin through fermentation and satisfies industry criteria. This should put the company in a strong competitive position in the natural color market, which is expected to reach a total of US$2.5 billion by 2025. In 2019, the numerous tests conducted by Fermentalg’s teams with various specialists in the food coloring market broadly confirmed the new product performance against that background that Fermentalg chose to join forces with DDW, the second-largest producer of natural food coloring worldwide. The group is the principal supplier of green, red and oranges to the dairy industries, also used for the sweets and caramel color for the production of colas.

According to their agreement, Fermentalg and DDW plan to pool their resources to finalize the technological, industrial, marketing and regulatory development of this new product to accelerate its industrial scale-up and commercial development.

By Elizabeth Green

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