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Financed in April of 2002, Cropsolution is focused on discovering safer,
more effective agrochemicals. The agrochemical market is ~$28 billion
dollars and includes products that prevent or eliminate weeds, insects
and diseases in important food and fiber crops. Currently, Cropsolution
is employing its proprietary Targeted Biology™ platform to discover
novel fungicides and herbicides. Cropsolution has a staff of 19
chemists, biochemists and businesspeople with experience in agrochemical
research and development, investor relations and business development.
The Agrochemical Marketplace
Cropsolution product opportunities
The Agrochemical Marketplace
Mergers and acquisitions within the $28 billion agrochemical
industry have resulted in a handful of new "powerhouse" companies,
all of which have strong capabilities in production, marketing and sales.
These big six agricultural chemical companies are not able to discover
and develop enough new products to feed their production, marketing,
sales-based infrastructures. As a result, new agrochemical products
have become increasingly valuable.
Cropsolution uses proprietary technology to dramatically reduce the cost and
time to discover and develop an agrochemical or increase the likelihood of
success. Implementation of our technology has resulted in the discovery of
a novel fungicides with commercial-level activity and a novel
mode-of-action herbicide [add link]. Cropsolution also has exclusive
access to Evolutionary
Chemistry™, a technology with the potential to save years and millions
of dollars in agrochemical discovery and development costs.
Cropsolution Product Opportunities
The
main drivers for new agrochemical product development include:
- Regulatory pressure to replace existing products. Many
of the leading agrochemical products are under severe scrutiny or formal
review by US and EU regulatory authorities. The reasons for the
review are both politically and scientifically based, resulting from
concerns about toxic effects of the products on humans, animals, or
the environment.
- Unmet needs. As much as a 30% yield increase could
be achieved for many crops if the right products could be developed
for pests and diseases for which no solution currently exists. The
global agrochemical market could grow by 50% or more[1] if
unmet needs were addressed cost effectively with safe chemical solutions.
- Target pest resistance to agrochemicals. Weeds, insects—and
most significantly—disease-causing fungi
develop resistance to
chemicals that control their growth. The result can range from
a minor marketing annoyance to a massive decrease in market share because
of lost efficacy.
- New markets. New uses for existing products have presented
attractive market opportunities. Some fungicides and insecticides
have proven very effective as seed treatments to control against soil-borne
diseases and insect pests immediately after germination. Seed
treatments are the fastest-growing segment of the agrochemical industry
for those companies that have introduced new products. Another
example is the marketing of insecticides, originally developed for
crops, for use as flea and tick control agents on companion animals. This
market has provided hundreds of millions in opportunistic revenue to
developers of new insecticides.
Current Cropsolution Product Opportunities
Cropsolution has identified 3 specific product areas to address:
- Novel mode-of-action fungicides
The last major class of new fungicides
was the beta-methoxy acrylic esters (MAEs), introduced beginning
in 1996. These now sell in
aggregate nearly $2 billion per annum, but have begun to elicit pest
resistance in the field. This is true for almost all new
classes of fungicides, so continued discovery and development
of novel modes-of-action is an industry need.
- Fast-acting non-specific herbicides
Paraquat currently sells ~$400
MM annually. It is widely used
in cropping situations where rapid kill of weeds is desirable. The
nearest performance competitor, Roundup, acts at least 10 times slower. Paraquat
is acutely toxic to humans and has come under intense regulatory and
public scrutiny. A novel, safe, fast-acting total kill herbicide
is a large product opportunity.
- Organophosphate replacement insecticides
These insecticides in aggregate
sell >$2 billion/year. Their
replacement is a high priority for the EPA, and any suitable insecticide
with less toxicity to vertebrates is eagerly sought by the industry.
Business Model
Cropsolution has a three stage business model.
Stage 1: Cropsolution has one
research and development deal with a leader in agrochemical discovery. All
the major agrochemical companies have taken meetings with the Cropsolution
team and several are considering such a relationship.
Stage 2 (current): Cropsolution is
licensing greenhouse and field-active leads from its proprietary programs
to the agrochemical industry. The
major multinational agrochemical companies will then develop, produce
and market the final products under exclusive partnering arrangements.
Our first proprietary project aimed at the discovery of a novel mode
of action fungicide resulted in a compound with commercial level and
spectrum greenhouse activity. Field evaluation at six sites world-wide
is underway.
Stage 3: Cropsolution will combine its pipeline of products and discovery
engine with an excellent sales and marketing team to form the fastest
growing, fully integrated agrochemical company.
To our knowledge, no biotechnology company has developed a small molecule
for the agrochemical market. Moreover, no other company is focused
on this business opportunity, in contrast to the more than 2000 biotech
companies working in pharmaceutical discovery.
Our Team and Culture
Cropsolution is fortunate to have attracted a group of people that has a demonstrated
track record of success and a keen interest in solving the problems on the
farm. Our people have three commercial agrochemicals on the market
and have helped guide companies from the start-up phase through IPO. Furthermore,
the folks at Cropsolution understand that most activities will be done better
with a team of people that respect and trust each other. Therefore,
we have a culture that emphasizes the
commitment we have to each other, our investors and our commercialization
partners.
The strong emphasis on culture is reflected in the governing body of the company,
the Board of Directors. Chaired
by Ambassador Clayton Yeutter, the Board focuses on generating shareholder
value by establishing a sound business with significant potential revenues. The
officers of the company are Eric Ward (CEO and Treasurer), Scott Uknes (President
and Secretary), Tim Gupton (CFO and Assistant Treasurer) and Michelle Hunt
(Assistant Secretary)
Financing history
After the negotiation of an exclusive license for Evolutionary Chemistry™ from
Invenux in 2001, Cropsolution was spun-out as a stand-alone company commensurate
with closing of a Series A financing in April of 2002. The financing
was lead by The Aurora Funds with ATP Capital LP, Research Triangle Ventures,
Charlotte Angel Partners, Atlantis Group and others filling out the $6.4 million
round. A Series B round of $5 million was closed in December of 2005. Cropsolution
is currently seeking additional financing.
2003 milestones
Cropsolution achieved all 2003 milestones:
- Identify a biologically active agrochemical from our first proprietary
project.
- Initiate a partnership with a leader in agrochemical research using
Evolutionary Chemistry™.
- Obtain additional financing.
2004 milestones
Cropsolution achieved all 2004 milestones:
- Identify a greenhouse active agrochemical from our first
proprietary project.
- Demonstrate commercial level greenhouse activity of a compound from
our first proprietary project.
2005 milestones—please contact the company
Some of Our Current Investors
Aurora
Funds The Aurora Funds, Inc. is a venture capital firm
that provides capital, connections and strategic help to entrepreneurs
with early stage life science and information technology companies.
Founded in 1994, Aurora invests primarily in the Southeastern and
Mid-Atlantic United States. The firm manages over $120 million in
four venture funds. Aurora's five investment team members have over
30 years of combined venture capital experience and over 35 years
of high technology operational experience.
ATP Capital LP
Oerke et al., 1994. Crop
production and crop protection; estimated losses in major food and cash
crops. Elsevier
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