Zacks Small Cap Analysis – DYAI: Moo-ve Over Bovines, C1’s Taking On Albumin – Cyber Tech

By John Vandermosten, CFA

NASDAQ:DYAI

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Proliant Well being and Biologicals Partnership

Dyadic Worldwide Inc. (NASDAQ:DYAI) introduced a growth and commercialization partnership with Iowa-based Proliant Well being and Biologicals to promote animal-free recombinant albumin merchandise produced by C1. The deal features a $1.5 million upfront fee, a part of which will likely be used to help Dyadic’s know-how switch, scale up and commercialization obligations. Based on the info assortment agency International Market Analysis Matrix, the worldwide albumin market measurement was $6.4 billion in 2023 rising at a mid-single digit price. Proliant is a dominant participant within the albumin market and has a facility in New Zealand to supply bovine blood product. The preliminary focus of the partnership will likely be on the manufacturing and commercialization of recombinant human serum albumin merchandise with launch anticipated in 1H:25. We anticipate terminal profitability to be achieved shortly as property are already in place.

Particulars of the association have been included in a June twenty eighth press launch.

Recombinant serum albumin has a number of essential makes use of in drugs and biotechnology. Beneath we enumerate a number of however not all the key areas the place it’s used:

➢ Stabilizer and service for medicine, significantly biologics;

➢ Complement to cell tradition media offering vitamins and development elements;

➢ Plasma expander for sufferers with extreme blood loss;

➢ Stabilizer for vaccine formulations;

➢ Protein purification;

➢ Diagnostic exams;

➢ Cryopreservation;

➢ Medical gadget coatings for stents and tubing to enhance biocompatibility.

In lots of circumstances, recombinant albumin is extra engaging than animal-based product as a result of it has fewer contaminants and no animal-borne viruses that could be current in naturally derived product. Provide of recombinant albumin is extra dependable, avoids moral points associated to animal use, is most well-liked by regulatory businesses and prospects and is extra sustainable than animal-derived product.

C1-produced recombinant albumin affords the extra benefit of being inexpensive to supply in comparison with different expression programs. Based mostly on our evaluation and suggestions from Dyadic, the price of producing recombinant serum albumin utilizing C1 versus different widespread expression programs can be from 25 to 30% decrease.

Based mostly on our conversations with administration and particulars launched within the press, first product gross sales could possibly be in 1H:25. Between at times the Dyadic and Proliant groups should full the know-how switch, scale up and commercialization actions. We consider that the advertising staff that can promote this product is already informing prospects and prospects of animal-derived albumin about the advantages of recombinant product, in preparation for first gross sales.

The deal between the 2 corporations will present an undisclosed share of Proliant’s income to Dyadic. We estimate this could possibly be from 10 – 15% of complete C1 derived recombinant albumin revenues. Whereas this deal is an unique for recombinant human albumin, it doesn’t forestall Dyadic from signing different offers within the albumin house from different animal hosts resembling canine albumin.

Proliant

Proliant Well being & Biologicals is a non-public producer of proteins that serves corporations within the microbiological, life sciences, biopharmaceutical and veterinary sciences world wide. The corporate has two manufacturing vegetation that host its closed-loop manufacturing course of with one positioned in Boone, Iowa and the opposite in Feilding, New Zealand. The amenities produce product based on FDA cGMP requirements. The New Zealand facility supplies bovine blood product for processing in Iowa and subsequent world distribution. Proliant supplies merchandise within the Diagnostics, Cell Tradition and Diet house. This contains bovine serum albumin, bovine gamma globulin, purified proteins, and digestive and intestine well being merchandise. Proliant works with many main well being science corporations together with Veritas, Biophyll and J Sights Company.

Proliant now solely produces animal-based albumin, but it surely acknowledges the desire for human and particularly recombinant human albumin that can be utilized in additional purposes. Up till now, the dearer lessons and grades of albumin which embrace human and recombinant human albumin usually are not used attributable to price constraints. C1 produced product is predicted to have considerably decrease product prices in contrast with opponents as a result of effectivity of C1 as a manufacturing system and attributable to diminished purification calls for which are essential for Chinese language hamster ovary (CHO) or e. coli manufacturing.

Abstract

Dyadic makes a daring transfer into the animal-free recombinant albumin house with a partnership announcement. The deal, which affords a small upfront to cowl the prices of know-how switch and scale up, ought to arrange the companions to have first gross sales of recombinant human albumin in C1 by 1H:25. The association affords many advantages to the manufacturing of recombinant serum albumin together with sooner manufacturing, fewer contaminants in contrast with animal derived product and decrease price. Mixed with Proliant, which has a deep bench of consumers, we predict that Dyadic and its C1-derived product could make headway into the house. The superior product can doubtlessly take share from different animal-sourced and recombinant albumin and probably increase the market because the decrease price product will help growth of recent makes use of.

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