“Given our expertise in dairy science, we committed to exploring the potential for Fonterra to play more boldly in this space,” he said.
Fonterra had developed a business case and agreed on a way forward, which includes establishing a corporate ventures arm with access to its dairy science and innovation expertise.
“The business will incubate and scale a portfolio of disruptive ventures by developing solutions that combine science, nutrition and technology to make a real impact on human health,” Hurrell said.
The biotech business – provisionally named Nutrition Science Solutions (NSS) – would operate as a standalone business within Fonterra.
A chief executive is yet to be appointed.
NSS will target opportunities for value creation by adapting the co-op’s existing capabilities and assets, alongside new disruptive capabilities, through partnerships and mergers and acquisitions, Fonterra said.
“NSS will seek out, partner with and invest in global start-ups who will benefit from access to Fonterra’s dairy science expertise and understanding of the global market, while Fonterra will benefit from access to emerging technologies, advancements in science, and novel channels to market.”
Pendulum specialises in targeting metabolic health through evidence-based microbiome solutions.
A microbiome is a community of micro-organisms that can benefit human health.
The partnership will see Pendulum and Fonterra establish a presence in global markets, co-develop and commercialise next-generation products.
Fonterra’s chief innovation and brand officer Komal Mistry-Mehta said NSS will first target microboeme technology, as it pertains to gut health and nutrition.
“This is a really fast-growing area that is getting a lot of attention from academics and scientists, but also the venture capital community,” she said.
“There has been US$7 billion ($11.5b) invested in this space over the last five years,” she said in a conference call to journalists.
NSS will initially target the United States and China as potential markets.
