Craig McIntosh concedes there are minor parallels between the Christchurch company PharmaZen and dumpster diving.
Both seek to make use of products that have little or no value, one from someone else’s discards and, in the case of his company, extracts from the by-products of plants and animals.
But that is where any similarities end.
McIntosh, the chief executive of PharmaZen, said the nutraceutical company takes low-value meat, fish and botanical products and uses solvent extraction or freeze-dry processes to turn them into nutraceuticals, which are then exported around the world.
Its nutraceutical products are based on blackcurrant, kiwifruit, ovine, porcine, bovine, fish and greenshell mussel extracts, reconfigured and sold as capsules, sachets and soft gels to assist dietary, nutritional, digestive, joint and bone health and musculoskeletal systems.
PharmaZen has one of the world’s largest krill oil facilities.
The company was formed in 2001 by entrepreneur the late Howard Paterson along with Dr Max Shepherd and Dr Tak Hung to commercialise animal remedies developed by Zenith Technology in collaboration with the University of Otago.
In 2002 it acquired biotechnology company Waitaki Biosciences International.
PharmaZen’s shares are listed on the Unlisted Securities Exchange.
McIntosh said in the early days its products were almost solely linked to extracts from beef processing, but implications following the outbreak of Bovine Spongiform Encephalopathy highlighted the need to diversify.
“We were at the risk that if the sector sneezes or gets a sniffle, we get pneumonia.”
Meat offal is becoming more highly priced and competition is growing so they are constantly looking for low-priced suitable products that they can use.
One they are looking at is products extracted from lamb pelts.
“We have a long runway of opportunities, but that one is sticking out there.”
Other new products include marine collagen made from fish skin and a functional treat for pets, which targets the Chinese market and will be launched next month.
The company employs up to 80 people and has its own research and development team, a mix of scientists and mechanical engineers.
McIntosh said the processing and extracting process requires bespoke machinery, which can take 18 months to design and build, so having its own engineers is crucial, as is having its own scientists.
He said the business has required significant capital investment as it diversifies its product mix.
But that means growth and revenue growth come in steps as extra capacity or new products come on stream before the planning and designing process starts all over again.
About six years ago turnover was $7 million but last year it was $29m.
With a 40% increase in capacity about to come on stream, McIntosh said this will be reflected in future turnover growth, which potentially could more than double in a few years.
