FDA GRAS Designation... Why important..
posted on
Oct 23, 2006 07:22AM
Agrastim is a new product, containing the highest percentage of refined beta glucan on the market.
It is being manufactured using new methodologies and on a scale never met before. The plant in Hinesville, Georgia is the first of its kind.
Potential customers of Agrastim are looking at the benefits of switching from antibiotics to beta glucan (Agrastim). This would represent a tremendous shift in their business paradigm. This shift could leave them vulnerable if Agrastim would ever be challenged by the FDA as not being safe in entering the human food chain.
BioAgra started the FDA application process to ensure Agrastim's safety. As stated on the FDA website for GRAS designation, it usually takes up to 180 days for evaluation. The FDA even states in the PDF that they acknowledge that this amount of time can be trying on companies since their customers will not buy the product until FDA GRAS is granted.
BioAgra had to use independent laboratories to certify testing and send those tests to the FDA. This is a requirement of the FDA for independent lab analysis.
Agrastim did receive the GRAS designation and that is important for all producers of livestock that want to use beta glucan, can use Agrastim without fear of liability with Agrastim entering the human food chain.
The amount of antibiotics used by livestock for human consumption in the US is tremendous. It represents a large investment. Switching to Agrastim requires assurances that it is safe, it will work, and it is cost effective, and that Agrastim can be produced in quantity sufficient to meet customers' needs.
That leads me to a second point.
BioAgra had to prove that they could produce Agrastim in quantities that would service the needs of their customers. In addition, they had to prove they could produce consistent quality.
This quality and quantity has been demonstrated. In addition, BioAgra will Assay (test) each batch of Agrastim for beta glucan activity and provide documentation of each batch's efficacy. This assurance is important for consistent quality to the customer.
To my knowledge, no current producer of beta glucan has been able to produce in quantity and quality. BioAgra has been able to do both and do it consistently and certify their product.
For a company to switch, they have to know they can count of BioAgra to deliver.
A third point.
Any potential customers will need to know that Agrastim is effective both in their livestock and in cost. They will do their own independent testing. This has been going on since BioAgra began producing. This was stated in the past 10K that BioAgra has been producing evaluation/test product for potential customers.
A shift in a customers production models requires that the cost be justified in production enhancements. They will test it themselves.
From my understanding, Agrastim has shown strong efficacy as an antibiotic replacement (cost and mortality saving) and for companies that were natural (not using antibiotics), Agrastim decreased mortality rate substantially. Both represent cost savings to the potential customer.
When we are considering one company investing $1/2 million to $1 million per month for just this one additive, the customer has to be sure that it is effective, cost effective, and safe (FDA GRAS).
In closing, I have been very frustrated in how long it has taken but in hindsight, I recognise that BioAgra has had to do things right to be successful.
I look forward to purchase orders and finally seeing the share price move in the right direction.
My Van needs new tires.
Kent