The venture arm of the food company Tate & Lyle and the Scottish Venture Fund have acquired the thin films manufacturing unit of Devro plc, a food manufacturing supplies company.
The new company, BioFilm Holdings Limited, will be run by Trevor Morgan, Devro’s business development director. The sale is for a nominal sum, but Devro is owed up to GBP3.6 million in the event of a subsequent sale of the company. The new owners said they plan to invest GBP3 million in the business.
BioFilm was set up in 2003 to commercialise new technology for the manufacture of specialist thin film products and claims to be the only fully integrated manufacturer in Europe of dissolvable/edible films that can carry active ingredients.
Use of dissolvable and edible films in medical devices such as anti-snoring strips, and as a delivery mechanism for a range of active ingredients, including breath fresheners, nutraceuticals, and drugs is increasing rapidly. This is due to the ease of use, cost benefits and, in some cases, because of improved absorption of the active ingredient through the buccal membrane inside the cheek.
While the edible film market is well established in North America, the European market is only beginning to emerge. Analysts estimate that the total market could reach $500m this year and $2bn by 2012.
BioFilm’s films can be made from a range of products including gelatine, pectin, cellulose and collagen.
David Atkinson, Managing Partner, Tate & Lyle Ventures said, the edible film market is fast-growing, particularly in North America, and fits well with the fund’s focus on biomaterials. “We see potential in the medical/ drug delivery market where dissolvable films allow fast delivery of active ingredients. BioFilm also provides a unique opportunity for us to enter the European market, which is currently small but we believe is likely to follow North American trends.”
Jonathan Lloyd-Hirst, Investment Manager of Scottish Venture Fund noted the fund is designed to attract new investors to Scotland. “We are therefore delighted to be investing for the second time alongside Tate & Lyle Ventures in a Scottish company, BioFilm.” The two funds were part of the consortium that invested in the second round funding of the marine biotechnology company, Aquapharm Biodiscovery Ltd in July 2007.
Tate & Lyle Ventures is a GBP 25 million fund that invests in companies in the fields of renewable ingredients, food technologies, renewable resources such as biomaterials and biofuels and industrial processing technologies. The fund is independently managed by Simon Barnes and David Atkinson of Circadia Ventures.
The Scottish Venture Fund provides investments of up to GBP 2 million per transaction in partnership with the private sector on at least a matched funding basis in syndicated transactions, typically, between GBP 2 million and GBP 10 million.