The Daily Record
September 2003

Improving the food chain with DHA
By: Mary E. Medland

Ask the average citizen for a quick definition of DHA, and a blank look is the most likely response. After such a reaction, don’t even bother to inquire about its importance to all animal life — from fish to humans.

But DHA, an essential fatty acid that is produced from microalgae, is the fundamental building block for optimal development of the brain and eyes.

“DHA is very rare and very difficult to find, but we all need it in our diets,” he says.

Kyle’s background at Martek Biosciences Corp. — he was a co-founder and senior vice president of research and development at what is now a $1.4 billion enterprise — included convincing baby-formula manufacturers of the value of adding DHA to their products. While breast-fed babies get DHA from their mothers, those being fed formula do not.

“We had a number of challenges at Martek,” says Kyle, who holds a doctorate in biochemistry from Canada’s University of Alberta. “The first was getting production up to a commercial level, then presenting the clinical data to [baby] formula companies and convincing them of DHA’s importance, and finally, getting approval from the Food and Drug Administration.”

Having made a convincing argument for the importance of DHA to humans, Kyle struck out on his own about a year-and-a-half ago, determined to pursue the use of DHA in other animal species.

OK, but who cares if the cow that’s going to find its way into a hamburger is smart and has 20-20 vision?

"DHA is very rare and very difficult to find, but we all need it in our diets." - David J. Kyle, President and CEO, Advanced BioNutrition Corp.

“We’re focusing on optimal nutrition, which means that very young, developing animals that have DHA in their diet, often given in a powder form, are going to be more resistant to disease, have a better growth rate and a greater survival rate,” says Kyle. “This will allow animals to have a stronger central nervous system and to require fewer antibiotics.”

Kyle is particularly enthusiastic about DHA’s potential when it comes to aquaculture, which he sees as key to feeding the planet. “Fish and shrimp farming is rapidly growing, and the ‘Blue Revolution’ will continue to expand,” he says.

The irony of fish is that the essential ingredient they are famous for — DHA — is something they cannot produce. Rather they must be fed DHA, often in the form of fish meal and fish oil, which may be contaminated, not to mention that such a system is not sustainable.

“You’re not going to do well if it takes 2 pounds of fish meal to create another 1-pound fish,” says Kyle.

With the introduction of Advanced BioNutrition’s DHA from microalgae rather than from fish meal and oil, there is the added benefit of the fish being a completely renewable and contaminant-free resource.

And when it comes to products that are deemed organic, most fish don’t make the cut. At least not yet.

“To qualify as an organic product in the United States, you must use seeds from a sustainable resource,” Kyle says. “But most fish farms use fish meal and therefore cannot be designated organic. But by substituting DHA from microalgae, we’ll be able to see the first organic seafood products in this country.”

Risk-free Infeed Delivery of Inert Vaccines
By Fiona Cameron

Conventional vaccination techniques based on injection or oral application both carry problems. U.S. company Advanced BioNutrition Corp. reckons it has cracked this nut with a new platform technology which allows risk-free in-feed delivery of inert vaccines.

"Oral delivery of vaccines is still a relatively new concept, and the current approach involves growing a pathogenic bacteria or virus to generate the vaccine. Growing a pathogen in a highly controlled environment is expensive, and once you raise such a live organism, you have to make absolutely sure you kill 100% of it so that your vaccine doesn't cause an infection!" said David Kyle, CEO of ABN.

ABN's approach is to build a model of a virus that consists of only the outside shell, not the entire complex virus. Though it is not based on a live organism, due to it outward appearance it has the same effect on the immune system as a live virus, triggering the desired immune response in the fish.

"It's like putting a scarecrow in a field," said Kyle. "You could say it's effective without being infective." It is also adaptable to deal with many different viruses and bacteria. "It can be applied very effectively to rapidly-changing viruses. If you look at ISA, one of the difficulties has been that it's constantly changing. This new technology can result in almost real-time responses to changes," said Mr. Kyle. He believes that the product will be especially useful in tackling IPNv.

ABN Collaborates With Universities on Fish Research

COLUMBIA, MD--Advanced BioNutrition Corp. (ABN), a leader in developing nutritional products to promote health and control disease in the fields of aquaculture and agriculture, has announced that it has entered into collaborative research and development projects with two California universities: California State University-Hayward and San Diego State University.

San Diego State's Dr. Arun K. Dhar, adjunct professor in the department of biology, will lead research to monitor gene expression in healthy and virus-infected shrimp by DNA microarray analysis to better understand the molecular basis of viral disease in shrimp. Viral disease is responsible for significant commercial losses each year in the shrimp industry, ABN said.

At Hayward, Dr. Beverly Dixon, profession of biological sciences, will lead research to isolate and indentify novel strains of intestinal anaerobic bacteria in fish and to establish their potential for use as probiotic supplements in feeds.

David Kyle, president and chief executive officer of ABN, said, "We are pleased to work with these top-class researchers who are applying cutting-edge technology to real challenges in aquaculture. This research will be of great importance as we pursue our mission of generating solutions to major problems in the global aquaculture industry."

ABN, based in Columbia, is a leader in developing nutritional products to promote health and control disease in the fields of aquaculture and agriculture. ABN applies established biotechnical principles to create proprietary, science-based animal health and nutrition products.

Advanced BioNutrition Seeks To Improve Animals' Health
By Ellen McCarthy
Washington Post Staff Writer

David J. Kyle spent 16 years helping turn Martek Biosciences Corp., a small biotech company he started with four others, into a multimillion-dollar firm. Now he is ready to begin again.

Advanced BioNutrition Corp., Kyle's second start-up, sells nutritional supplements that increase the health and development of fish, crustaceans and livestock.

Kyle headed the research and development team that created Martek's algae-based nutritional oils, now being used in baby formulas worldwide. During the process, Martek did initial tests on the effectiveness of its products in fish and other animals. After finding that the product was useful in animal development, Martek began to sell a line of supplements called AquaGrow.

"We were selling the products but were very focused on getting the human products to market," Kyle said. "We just didn't have the time or resources to devote to the [animal] feed market. It just wasn't moving as quickly as it could have been."

Rather than develop a new unit within Martek, Kyle decided to launch a new company, Advanced BioNutrition, solely devoted to the development of nutritional supplements for animals.

In October, the company moved to a new lab space and took over sales of AquaGrow, giving it an instant revenue source to support the research and development of other products. ABN became a client of Martek's, buying a byproduct created during the development of Martek's nutritional oils.

"That allowed ABN to hit the ground running with products that were already being sold all around the world," Kyle said. "But that's really just the start. Conceptually, we're positioning ourselves to leap into the veterinary pharmaceutical arena by way of nutrition."

Advanced BioNutrition's scientists are working to develop therapeutic supplements that they hope will increase antibodies in animals, making them more resistant to potentially harmful viruses and decreasing the need for over-used antibiotics.

"This is not a small market. Equador is the second largest producer of shrimp, and when a virus hit last year, production dropped 80 percent, costing the country $750 million," Kyle said. "What we're creating could potentially prevent instances like that."

Kyle said the second round of products could be ready for market in as little as 18 to 24 months, and he expects the company to make major breakthroughs in the coming year.

© 2001 The Washington Post Company

Baltimore Business Journal, Dec. 7-13, 2001

Martek Founder Spins Off Bio-Agriculture Firm
by Scott Graham

David J. Kyle is at it again.

About 17 years after helping start up publicly traded Martek Biosciences Corp., Kyle last month unveiled his latest bioscience creation, Advanced BioNutrition.

Founded on technology developed by Columbia-based Martek (http://www.martekbio.com), Kyle spun the company out to potentially capitalize on the growing bio-agriculture and bio-aquaculture markets. Enhancing the nutritional value of poultry and other animals that are consumed by humans is an emerging industry.

"As Martek became more focused on infant nutritional products, we saw a need in both agriculture and aquaculture for similar nutritional supplements," Kyle said. "But Advanced BioNutrition really is focused on developing what are basically veterinary pharmaceuticals."

In fact, with $2.55 million in financing already in its coffer, Advanced BioNutrition wasted no time commercializing its lead product, a nutritional animal feed called AquaGrow that is sold in Ecuador, Southeast Asia and Europe, Kyle said.

So far, revenues have been minimal -- Kyle said the company could generate a few hundred thousand in revenues in its first year -- but pertinent to the fledgling company's success.

Advanced BioNutrition recently moved into its 3,500-square-foot office and laboratory space, hired six people and began its marketing campaign for AquaGrow, Kyle said.

"Revenues are small right now, but we're really focused on ramping up product sales," he said.

And with its disease-control product still in the research and development phase and the need for more laboratory space and personnel already looming, Kyle may be forced to go after a second round within the next year, he said. The round could amount to as much as $4 million, he said.

Meanwhile, to address its immediate need for more laboratory space, Advanced BioNutrition is negotiating a deal with the University of Maryland Biotechnology Institute (http://www.umbi.umd.edu) to lease as much as 1,000 square feet of space in downtown Baltimore's Center for Marine Biology.

The four-year-old facility, which also is known as the Columbus Center, was the home of the Hall of Exploration for about a year.

"We are young and new, but we're already coming up to being fully operational," Kyle said.

Maryland Daily Record, Nov. 26, 2001

Starting Over Again - With Farm-Grown Fish This Time
By Karen Buckelew
Daily Record Business Writer

David J. Kyle just finished a 16-year run as senior vice president of research and development for Martek Biosciences Corp., the Columbia-based firm he co-founded in 1985.

In his long career in biochemistry, Kyle has earned more than 70 patents in biotechnology and nutrition, not to mention his founding of Martek, which is seeing its nutritional products added to infant formula around the world.

Now, Kyle is starting over again as CEO of Advanced BioNutrition Corp., a brand-new biotech Kyle founded this year just down the road from Martek in Columbia.

ABN just finished its first round of funding, netting $2.5 million from various investors, including the state of Maryland.

Earlier this month, the company also launched its first product, a nutritional supplement that can be added to fish feed to fight disease.

Kyle hopes ABN's nutritional products will be able to replace the use of antibiotics in fish farming, a process that is resulting in antibiotic-resistant strains of disease in the aquaculture industry.

And Kyle's new work has not strayed far from his old-the nutrients ABN places in the fish food are obtained from the algal oils Martek uses to produce its infant formula nutrients.

"Our company is focused in an area that's a little different from Martek, which does human bionutrition," Kyle said. ABN "is in the animal feed market. The aquaculture area is our primary area of focus."

It was at Martek that Kyle got the idea to branch off into animal nutrition.

"Some of the developments that we really promulgated at Martek [in] infant nutrition" are useful in animal nutrition, too, he said. "A lot of the components for normal rapid development of human infants are true for all other animals as well, including fish."

Natural defenses

ABN takes the nutrients that occur naturally in the types of food that fish would eat in the wild and includes those nutrients in the food they eat in fish farms.

"When you go to an intensive farming environment, you have to provide feed that is over and above natural feeds that are there," Kyle said. "Feed mills use low-cost sources of protein like corn feed or soybeans, which is not natural eating" for the fish.

But natural phytoplankton-small single-cell algae the fish eat in the wild-contain nutrients like omega-3 fatty acids and antioxidants.

"Phytoplankton have a lot of very good components nutritionally that really promote the health of the consumers," Kyle said. "Free-living algae in the seas have to defend themselves against bacterial attack, and they have their own natural; mechanisms to prevent the growth of bacteria."

When fish consume the microalgae, they ingest those natural mechanisms and are protected against bacteria.

ABN's first product is made up of the omega-3 fatty acids and antioxidants found in the microalgae, and is sold to distributors to dispense to farmers.

"This represents just one of the product offerings of ABN," Kyle said. "It is our goal and our intent to expand significantly the product offerings we can provide."

Those products could include nutrients derived from yeast as well as algae. ABN also is exploring the possibility of including vaccines to prevent disease in the food the fish eat-a product that could be on the market in two years, Kyle said.

In addition, the company plans to explore its concepts in terrestrial agriculture-chickens, hogs and cattle.

"A lot of the monies we're getting in this first round [of funding] is going to go to complete research and development," he said.

The Series A funding round was led by Eastbourne Capital Management of California, which contributed $900,000, and was filled out with investments from the state and angel investors.

Eric Sippel, CEO of Eastbourne, said ABN had all the components the firm looks for when considering an investment in a company.

Eastbourne mainly invests in public companies, he said, but will fund private firms if they meet several stringent criteria.

Addressing the market

The entire aquaculture industry is concerned about overuse of antibiotics, and that means a huge potential demand for ABN's products, Sippel explained.

"When we invest in a private company, we look for there to be an important problem with a large potential market size," Sippel said. "What ABN is addressing-both the market and the problem-fit that bill very nicely."

Sippel said the need for ABN's technology is quite clear in the industry.

"It is intuitively obvious, but also scientifically, true, that nutrition can address the health needs of living organisms in a way that can supplement or replace some of the antibiotics," he said. "That would eliminate he problem of too much antibiotics going into the ponds. That's a huge problem-that's what's interesting" about ABN.

The leadership of the company is another serious consideration for Eastbourne.

"We look at the quality and in integrity of the Our Team," Sippel said.

Eastbourne, an investor in Martek as well, was quite familiar with Kyle and was "very satisfied" with him as a leader, Sippel added.

Now that its first round of funding is complete, ABN has moved into new offices and lab space in Columbia. The company is filling out its labs and focusing on the sales and marketing departments.

"I would say we're probably up to 70 percent operational speed right now," Kyle said.

While he has moved on to new things, Kyle is grateful he can maintain his ties with Martek through ABN.

"I have a great relationship with Martek," Kyle said. "Those were the best 16 years of my life. This is a new opportunity and an exciting opportunity. I'm spending 100 percent on it."

Washington Business Journal, Nov. 16-22, 2001

Bionutrition Firm's $2.5M Funding Will Go to the Fishes
by Chris Silva
Staff Reporter

David Kyle worked for Martek Biosciences in Columbia for 16 years, developing novel fatty acids used as nutritional supplements in infant formulas worldwide.

But when things at Martek got too busy to continue research of a promising new feed product for aquaculture, Kyle decided to form his own company based around the technology.

Advanced BioNutrition (ABN), a spin-off of Martek (www.martekbio.com) closed its first round of funding Nov. 14, raising $2.5 million. Kyle, the company's CEO and founder, says the funds will be used for sales and marketing of AquaGrow, an algal feed product rich in DHA-a fatty acid that serves as a building block for brain tissue.

"We're seeing aquaculture go high tech, moving towards biotech methods," Kyle says. "We're researching a type of algae that prevents the growth of bacteria and improves the diet of young fish."

The round of funding was led by Eastbourne Capital Management, which is based in San Rafael, Calif. The state of Maryland and angel investors also contributed.

Eric Sippel, chief operating officer of Eastbourne Capital Management (www.eastbournecapital.com), says "the size of the opportunity and the lack of competition addressing that large market" made ABN a good company to invest in. It also helped that Eastbourne is an investor in Martek Biosciences.

Kyle says he's already taken orders for AquaGrow. While the algae-based product provides a nutritional benefit to fish, ABN scientists are working on adding a disease-resistant component to the substance over the next few months.

Ultimately, ABN hopes AquaGrow will eliminate the need to administer antibiotics to fish in order to ward off disease. Bacteria resistance to antibiotics has created a huge problem for the agricultural and medical industries over the past few years. A dearth of new antibiotics in the pharmaceutical pipeline has caused great concern for physicians, who fear current treatments will lose their effectiveness in treating human disease, and for farmers, who fear they'll lose effective therapeutics that help their animals grow big and healthy.

"The algae would prevent sickness, and reduce the use of antibiotics being administered," Kyle said.

A form of AquaGrow also could prove useful to poultry farmers, he says.

ABN, which was incorporated in March, also will use its first round financing to research other products, including possibly vaccines.

CLOSE UP:

• Advanced BioNutrition
• Headquarters: Columbia
• Raised: $2.5 million in first-round financing
• Investors: Eastbourne Capital Management; State of Maryland; angel investors
• CEO: David Kyle, formerly of Martek Biosciences
• Lead product: AquaGrow, a nutritional feed product for fish

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