nanosynth group plc (LON:NNN), the AIM quoted company specialising in the synthesis and application of nanoparticles to create new and improve existing products, has provided the following corporate and commercial update.
2022 was a year of substantial progress for the Group in which we have successfully transitioned from acquiring a university spin-out to a business with some excellent, viable commercial opportunities in fast-growing markets.
The Board is now firmly of the view that the Group has clear direction and a detailed execution plan.
Supporting our strategy and furthering our ability to deliver our goals, the Board welcomes the interest and investment from Lanstead and Oval X as new investors in recent months which have provided working capital and supported our capital expenditure needs.
In order to provide us with the laboratory facilities needed to grow, we have agreed to work with Bio City in Nottingham to develop the existing space to create dedicated production facilities for the agritech market, cosmetics market and general technology. This will provide improved and enlarged wet and dry laboratory facilities, enabling further R&D, with greater warehousing, storage and office space. Work on the new facilities is due to commence during the first quarter of 2023. We are pleased that the Company will be maintaining its roots in the city where P2F was founded and where ibuprofen was first discovered.
With the increased opportunities that are now being progressed, some of which are outlined below, production facilities are expected to be scaled up to meet future demand and enable dedicated nano-production. This is intended to be achieved through the manufacture of nano-material reactors of various size and suitable for both small and large scale production, allowing for a shift work pattern and short lead-times. Design and testing of reactors is currently being finalised and we hope to commission the first of these new reactors during the first half of the year.
The Board has focused Company efforts towards entering and establishing itself in seven strategic vertical markets having an aggregate value of in excess of £3.6 billion. Our objective has been to seek potential market sector leading clients and to demonstrate to them the potential competitive advantages of implementing our nanotechnology projects, including the attractive returns on investment that we consider to be achievable. This process has enabled us to very quickly identify our most likely project partners.
Coupled with this, the Board has strengthened the Company’s intellectual property portfolio, beyond the two pre-existing licenced process patents, filing two new patents in the areas of “Nanoparticles for the use in anti-pathogenic applications” (WO2022084685A1) and “Soluble nanoparticles for the use in cosmetic and sunscreen applications” (GB202118048DO). The Company’s research and development across its seven chosen vertical markets has led to additional intellectual property being identified which we expect to file in due course.
Our management team has been significantly strengthened over the last year, with a new Chief Technical Officer Imad Naasani joining P2F on 1st September 2022. Imad was based in Japan and the USA and brings extensive Nanotechnology experience to the Group as well as the proven ability to commercialise the science. Supported by our dedicated project management experience from the cosmetic industry, the appointment provides us with a new level of professionalism. Combined with the increased resources and skills within the labs outlined above we now believe we are well placed to deliver the necessary products for the future.
We are also in the process of updating some of our brand names (in particular P2F which is to be renamed Nanovate) and adding new brands to the Nanosynth Group.
|The joint development project with a household name wellness company progressed well during the later half of 2022, and the first of three batches of designed ingredients are being shipped in January 2023. Production of a second work package is due to commence imminently. This is an exciting commercial opportunity with a global company where legislation is driving the need for change. We recently obtained UK REACH registration for ZnO for volumes up to 100 tonnes per year to enable potential future production for this wellness company.
|In response to a UK and European Commission decision to ban therapeutic use of zinc oxide (to reduce diarrhoea in post weaning piglets) from June 2022, a global branded animal feed provider has completed national and international trials with a new Nanovatepiglet feed supplement. The results of the trials show that the new nano product may offer a viable alternative to the now banned zinc oxide to UK and EU farmers. Nanovate is discussing possible commercial collaboration with this potential partner company during the first quarter of 2023. Nanovate will also be seeking to supply feed for a wide range of animals via key strategic partners and feed manufactures across the globe.
|Initial trials with a household international paint company were completed during the year and have shown initial success and enabled the Company to create an antipathogenic paint designed to kill Streptococcus (the cause of scarlet fever), Methicillin-resistant Staphylococcus aureus (MRSA), E.coli and Pseudomonas aeruginosa bacteria on contact and prevents further bacterial growth. The Company’s patented copper nanoparticles were incorporated into a commercial white emulsion paint to create the antipathogenic paint – with no observed discolouration or reduced performance effects of the applied paint. Further work is required with a suitable partner to commercialise the offering and the Company is seeking partners outside of China.
|P2F is in final negotiations with a large farming company for a project within the agriculture field, where we will be looking to use our technology to enhance yields and tackle other factors such as hidden hunger (where the quality of food people eat does not meet their nutritional requirements). We expect this project, once the agreement is finalised, to begin in Q2 2023.
|The Company is in final negotiations within the seed coating space and is hoping to begin an R&D project by mid 2023.
|A global blue chip company is expected to begin to evaluate our minerals in H1 of 2023 with a view to starting a project in cosmetics if evaluation is successful.
|A large domestic plant food and fertiliser manufacturer is expected to commence trials with our nano minerals to enhance an existing product line with a view to move straight to commercialisation.
|We are continuing to look for companies within the seven identified key verticals with whom to undertake projects.
P2F product launch
|During 2022, the Company carried out in-house trials on various plants to determine how to improve and accelerate their growth via the use of nano technology. The trials have shown great results and the Company will be launching a Nano shot for the hydroponics market in the first quarter of 2023 called the Atomic Nano. Further Nano Shots are expected to be released later in the year for plants, vegetables and fruit. Immediate interest and engagement of a major fruit and vegetable supplier has been forthcoming and we expect this to result in a joint development for bespoke fertilizer products in due course.
|GB Nano has been established to become our in-house online ecommerce store and to be the go-to for clients to source Nano ingredients. Our intention is to list 90 plus products over the next two years with an initial launch of 12 that will be fully tested and regulated. A growing list of metal oxides nanoparticles with functional surface chemistries is being productised and made off-the-shelf to suit a wide range of applications including, life science, cosmetics, healthcare, medical device, electronics, plastic industry, energy storage, filtration, and numerous other niche applications. The off-the-shelf store will enable clients who have missed out on some of the key license projects within Nanovate to continue to have access to nano ingredients to undertake their own developments.
|The store is already attracting interest from major household named cosmetic and research and development companies.
Virosynth Joint Venture Status
|– P2F has formulated nano copper ink and applied it to polypropylene and polyester media
|– 6,000 litres of ink have been produced to meet initial expected demand as marketing the product commences
|– A faster in line testing process is being developed to support scale up
|– P2F has been granted UK REACH registration for CuO for volumes up to 100 tonnes per year
|Client development and testing
|– Leaching testing for environmental purposes under BS EN 12457 has been conducted with positive results – polypropylene and polyester media are classified as non-hazardous articles as they contain <1% of Cu with no impact on the media’s anti-pathogenic properties.
|– Leachate data of both media suggests they may be classified as Inert waste or stable non-reactive hazardous waste (this means the media may be deposited in landfill but not mixed with biodegradable landfill cells). Both wastes are suitable for incineration
|– Process improvements have led to OCT imagery that shows improved CuO ink penetration within the media compared initial proof of concept.
|– Supply agreements have been prepared to issue to prospective clients on a nonexclusive basis
|– Nanosynth/Virosynth will exhibit at the Filtech show in Cologne in February where it will launch our new product offering to a worldwide market. We will be presenting the novel technology in a series of presentations and events and currently 400 plus organisations are being invited to come and meet us during the event.
The Company remains committed to establishing partnerships and distribution outlets globally. We are currently working with:
|An agent to promote our copper coated technology to be applied to surgical gloves for the healthcare industry.
|An agent to promote our nanotechnology within the animal health, paint, rubber manufacturing and paint industries.
Fast Food Sector Opportunity
Through a long-established relationship, the Company has had the opportunity to apply its capabilities to solve a fundamental problem within the fast food industry. Restaurants and fast-food chains have been seeking a solution to the problem of retaining heat in food being delivered from a kitchen to the customer, whilst not degrading the quality of the product. Nanosynth is working confidentially with a global branded fast-food provider to reduce the temperature loss over a 20-minute period. To-date trials have managed to achieve a 13 degree positive saving on existing solutions, being only one degree short of the targeted goal. Further trials are underway, and the team remain excited and positive about the opportunity, albeit it is early days. Once the target has been reached and verified by the client, Nanosynth will look to offer the technical solution and ingredients to packaging manufacturers globally for their clients.
Future outlook and plans
The Board remain positive and excited at the opportunities that have been developed over the last year, albeit there is still a lot of hard work to be undertaken to get the Company to profitability. As such the Board wants to thank all the team for their commitment and support now and in the future. Market conditions to date have not leant themselves to explore an M&A strategy for the business but working with household brand named clients will open up opportunities for partnerships and more.
Mark Duffin, nanosynth CEO said “2022 was a year of substantial progress and we are excited by the opportunities that have been developed. The Board appreciates the frustration of shareholders wanting a constant news flow of RNS announcements, but the Company can only update the market collectively at the same time and not answer individual specific questions from shareholders. The Company’s current transition and development mean newsflow opportunities will be limited until we have established the Group as the go-to provider in our various chosen markets. We will however keep shareholders updated of all material developments in our various projects during 2023.”