About Cyanotech

Cyanotech Corporation engages in the production of high value natural products derived from microalgae. The company provides beneficial, quality microalgal products for health and human nutrition in a sustainable, reliable and environmentally sensitive operation. The company is Good Manufacturing Practices (GMP) certified by Merieux NutriSciences, reinforcing its commitment to quality in its products, quality in its relationships (with its customers, suppliers, employees and the communities the company lives in), and quality of the environment in which it works. The company’s products include: BioAstin Hawaiian Astaxanthin - A powerful dietary antioxidant shown to support and maintain the body’s natural inflammatory response, to enhance skin, and to support eye, joint and immune health. It has expanding applications as a human dietary supplement and dietary ingredient; and Hawaiian Spirulina Pacifica - A nutrient-rich dietary supplement used for extra energy, a strengthened immune system, cardiovascular benefits and as a source of antioxidant carotenoids. The company engages in the cultivation and production of microalgae into high-value, high-quality natural health and nutrition products. It cultivates, on a large-scale basis, two microalgal species from which its two major product lines, natural astaxanthin products and spirulina products, are derived. Natural Astaxanthin Products The company offers BioAstin, its natural astaxanthin product for the human health and nutrition market. BioAstin is generally recognized as safe (GRAS) as determined by the United States Food and Drug Administration (FDA). The company’s all natural BioAstin is cultivated without the use of herbicides or pesticides and is not genetically modified (non-GMO). In 2012, the company applied for a new dietary ingredient (NDI), with the United States FDA, providing for a daily dosage of 12mg of astaxanthin, which was reviewed without comment. BioAstin holds several independent third-party quality certifications, including iGen Non-GMO, Gluten Intolerance Group’s Gluten Free, Detox Project Glyphosate Free, Informed Choice, and is qualified in the United States Pharmacopeia’s (USP) Dietary Supplement Verification Program, for products produced up to and including the year ended March 31, 2022. The company produces natural astaxanthin from Haematococcus pluvialis microalgae grown in fresh water supplemented with nutrients. As these algae are extremely susceptible to contamination by unwanted algae, protozoa and amoebae, the company developed a proprietary system known as the PhytoDome Closed Culture System or PhytoDome CCS to overcome this problem. Using these large-scale photobioreactors, the company has generally been able to grow consistently large volumes of contaminant-free Haematococcus culture, subject to quarterly seasonality. The company uses third party contract manufacturers for the encapsulation and packaging of gelcaps. All third-party contract manufacturers are audit inspected by its Quality Department and are required to comply with the FDA GMP regulations. These contract manufacturers hold independent third party GMP certifications. BioAstin is sold primarily as a packaged consumer product through Nutrex Hawaii (Nutrex Hawaii, Inc.) to natural product distributors, retailers and online channels; or directly to consumers. It is also sold in liquid lipid form as a raw ingredient to dietary supplement manufacturers, health food formulators and cosmetic manufacturers. BioAstin gelcaps are sold in bulk quantities to international distributors. In 2012, the company began selling its 12 milligram BioAstin consumer product. In 2016, the company introduced vegetarian formulas of both 4 and 12 milligram consumer products. In 2021, the company introduced BioAstin water dispersible powder in 1% and 2% concentrations for worldwide bulk sales. This powder can be dissolved in hot or cold water, ready-to-drink beverages, such as teas, fruit juices or carbonated beverages, as well as incorporated into powder mixes, due to its neutral flavor profile. BioAstin competes directly with similar products marketed by other manufacturers, including Fuji Chemical of Japan, Algatechnologies of Israel, and BGG of China. Spirulina Products The company produces a strain of spirulina microalgae marketed as Hawaiian Spirulina Pacifica. Hawaiian Spirulina Pacifica provides a plant-based, highly absorbable source of protein, natural beta-carotene, mixed carotenoids, B vitamins, gamma linolenic acid, essential amino acids and other phytonutrients. Hawaiian Spirulina Pacifica is produced in two forms, such as powder and tablets. Powder is used as an ingredient in dietary supplements and health beverages. Powder and tablets are consumed as a daily dietary supplement. Both forms are sold in bulk quantities and as packaged consumer products under the Nutrex Hawaii label and as private label consumer packaged products. Hawaiian Spirulina Pacifica is GRAS for addition to a variety of foods as determined by the United States Food and Drug Administration. The company’s all natural Hawaiian Spirulina Pacifica is cultivated without the use of herbicides or pesticides; is Non-GMO Project verified; is certified Kosher by Organized Kashrus Laboratories of Brooklyn, New York; and is certified Halal by the Islamic Food and Nutrition Council of America. Hawaiian Spirulina Pacifica holds additional independent third-party quality certifications, including Gluten Intolerance Group’s Gluten Free, Detox Project Glyphosate Free; and is certified Vegan through Vegan.org. It also holds the highest, Class A safety rating from the Dietary Supplement Information Expert Committee (DSI-EC) of the United States Pharmacopeia. The company’s Hawaiian Spirulina Pacifica is cultivated in a combination of fresh water and a metered amount of nutrient-rich deep ocean water (containing essential trace elements), drawn from a depth of 2,000 feet below sea level. This water mixture is supplemented with other major required nutrients. The company recycles fresh water in its spirulina production process where possible and continues to explore further recycling opportunities. The company’s ponds are engineered to maintain the right media depth for sunlight to permeate each crop completely, facilitating rapid growth. The design of the company’s cultivation ponds promotes efficient growing conditions, allowing the Hawaiian Spirulina Pacifica algae to reproduce rapidly. Each pond can be harvested, on average, in nine days. Once ready for harvest, a majority of the spirulina algae are pumped from a pond to the company’s processing building where the crop is separated from the culture media. The culture remaining in the ponds serves as an inoculum for the next growth cycle. Harvested spirulina is washed with fresh water and filtered before moving to the drying stage. Culture media separated from spirulina algae during processing are conserved and recycled. The company’s Integrated Culture Biology Management (ICBM) technology for microalgae cultivation has proven to be a reliable and stable operating environment, allowing the company to grow and harvest spirulina without significant contamination by unwanted microorganisms and without associated loss of productivity. Hawaiian Spirulina Pacifica powder is dried via the company’s low-oxygen Ocean-Chill Drying process, thereby preserving high levels of antioxidant carotenoids and other nutrients sensitive to heat and oxygen. The rapid drying process results in a dark green powder. Spirulina powder is generally difficult to form into tablets, and most tablet manufacturers either add high amounts (from 10% to 30%) of inert substances to ‘glue’ the tablet together or use a heat granulation process that destroys nutrients. In contrast, the company’s Hawaiian Spirulina Pacifica tablets contain a maximum of 2% of such substances and are produced in cold press compression tablet-making machines. Each production lot of Hawaiian Spirulina Pacifica is sampled and subjected to thorough quality control analyses, including testing for moisture, carotenoids, minerals, color and taste, among others. Further, each lot of the company’s Hawaiian Spirulina Pacifica undergoes a prescribed set of microbiological tests to ensure the absence of contaminants, including total aerobic bacteria, coliform bacteria, Salmonella and E. coli. The Hawaiian Spirulina Pacifica powder and tablets are packaged to extend shelf life and ensure product freshness. The company’s packaged consumer products are bottled and labeled by third party contractors in California. These contractors are subject to regular government inspections and hold Drug Manufacturing Licenses & Processed Food Registrations with the State of California Department of Health. These contract manufacturers hold independent third party GMP certifications. The majority of the company’s bulk spirulina is sold to international health food manufacturers and formulators, many of whom identify and promote its Hawaiian Spirulina Pacifica in their products. Such customers purchase bulk powder or bulk tablets and package these products under their brand label for sale to the health and natural food markets in their countries. Some of the brands produced by these customers are marketed and sold in direct competition with the packaged consumer products sold through the company’s Nutrex Hawaii subsidiary in international channels. In the domestic market, Nutrex Hawaii packaged consumer products are sold through natural product distributors, retailers and online channels, or directly to consumers. In selected international markets, the company has exclusive sales distributors for both its bulk and packaged consumer products. The company’s direct competition in the spirulina market is from Dainippon Ink and Chemical Company’s Earthrise facility in California, Parry Nutraceuticals, a division of Murugappa Group of India and several farms in China. Contract Extraction Services As a result of capacity improvements that the company made to its 1,000 bar, supercritical carbon dioxide extraction system, the company began offering contract extraction services to third-party producers of astaxanthin biomass in 2019. Research and Development The company’s research and development expenses were $0.7 million for the year ended March 31, 2022. Regulations Several governmental agencies regulate various aspects of the company’s business and its products in the United States, including the Food and Drug Administration, the Federal Trade Commission (FTC), the Consumer Product Safety Commission, the State of Hawaii Department of Health, the Department of Agriculture, the Environmental Protection Agency (EPA), the United States Postal Service, state attorney general offices, and various agencies of the states and localities in which the company’s products are sold. Environmental Matters In 2002, the company was issued under the Endangered Species Act (ESA) an Incidental Take Permit (ITP) by the United States Department of Interior Fish and Wildlife Service (FWS). As a mandatory component for the issuance of such permit, the company submitted and maintains a Habitat Conservation Plan (HCP) to ensure that the effects of the permitted action on listed species are adequately minimized and mitigated. History Cyanotech Corporation was founded in 1983. The company was incorporated in the state of Nevada in 1983.