Exclusive Interview with Front Range Biosciences Co-Founder and CEO Dr. Jon Vaught
The cannabis and hemp industries have yet to be flooded with biotechnology competition, but a number of companies are making headway. Front Range Biosciences has developed a Clean Stock program, which it uses to supply young hemp plants and seeds to cultivators, helping them avoid pathogens and compromised genetic profiles. Co-Founder and CEO Dr. Jon Vaught spoke with New Cannabis Ventures about his company’s experienced team, products, partnerships and focus on sustainability. The audio of the entire conversation is available at the end of this written summary.
Agricultural Experience at Front Range Biosciences
Before co-founding FRB, Dr. Vaught spent 15 years in molecular diagnostics, developing and commercializing technologies. On the side, he started a nonprofit focused on sustainable animal agriculture. He fell in love with agriculture and its potential to have a significant impact on the world. The FRB team has extensive experience in agriculture and horticulture.
Dr. Vaught’s fellow co-founder, Nick Hofmeister, has a background in biotech startups. He has an MBA and focuses much of his efforts on fundraising. Cecilia Zapata, PhD, Vice President of Nursery, oversees the company’s Clean Stock program. Over her 25 years of experience, she has worked with more than 1,000 different species of plant, according to Dr. Vaught. Lee Heyl, Director of Operations, is in charge of FRB’s hemp nursery. He has more than 30 years of experience in the nursery industry. Ray French, Vice President of Business Development, spent 15 years overseeing Home Depot’s product development line before joining FRB. Reggie Gaudino, PhD, Vice President of Research and Development, comes from Steep Hill and has years of experience in molecular diagnostics and plant biology. Michael Westendorp, Senior Propagation Manager, has worked for companies like Driscoll’s over the course of his 25-plus-year career.
Young Plants and Seed
FRB uses tissue culture to support its Clean Stock program. The program maintains plants in a sterile environment, ensuring high-quality, pathogen-free generation after generation. The company grows young plants, also referred to as clones, and uses its Clean Stock program to produce its high-quality, clean seeds. In addition to hemp, FRB has a similar program for coffee.
The company is focused on the nursery portion of the supply chain. It will grow its young plants and germinate seeds in highly controlled laboratory setting. Then those products will be transplanted into outdoor grow operations.
FRB works with licensed companies working the regulated California cannabis market, as well as hemp farmers growing anywhere from just a few acres up to thousands of acres at a time, according to Dr. Vaught. He is also seeing farmers growing traditional crops showing interest in adding hemp to their rotation.
The company is focused on understanding the underlying biology of the plant so it can breed products for high performance in different regions. Dr. Vaught offers the example of the growing in Oregon compared to southern Alabama. The conditions are vastly different. Biotechnology will allow companies like FRB to target specific regions and improve grower’s abilities in those regions.
As the company continues to produce and refine its products, sustainability is a major focus. As hemp and cannabis move toward becoming commodity crops, Dr. Vaught sees biotechnology as a way to create more sustainable and regenerative approaches to agriculture.
Industry Partnerships
FRB considers its customers to partners. Rather than simply selling their plants and seeds and then losing that connection, the company is invested in tracking the performance of those products. The company collects feedback from growers and farmers to better understand how its plants perform in specific regions and what improvements can be made to address the challenges of specific regions.
The company also forms partnerships all along the supply chain. For example, the company forms partnerships on the input side. It wants to know how different fertilizers or microbes affect its product as it moves through the supply chain.
Research and Development
R&D is a big part of the company strategy, so naturally it has formed research partnerships. FRB has been working with UC Davis on hemp genomics research. The goal of the project is to develop a new reference genome in the hemp space. The more reference genomes available, the better researchers will be able to understand the plant’s genome and breeding processes, according to Dr. Vaught. Over the last 18 months, the collaboration has contributed valuable information to FRB’s own R&D and breeding work. Dr. Vaught expects UC Davis to move forward with study publication over the next year or two.
FRB is focusing significant resources on R&D. The company recently acquired the Steep Hill R&D team–the deal also includes a collaborative licensing agreement with some of the intellectual property Steep Hill has developed. The combination of the two teams has created a larger, multidisciplinary R&D team that is driving the company’s innovation efforts.
The Competition
FRB’s competitors are other companies producing young plants and seeds, but given the growth in the industry, Dr. Vaught sees the space for multiple competitors to thrive. He sees more early-stage companies focusing on genomics and molecular testing to develop new plant varieties, like FRB, but he hasn’t seen any large, established biotech companies enter the space.
“The bigger a company is, the harder it is to pivot toward a new product, a new crop,” says Dr. Vaught. Those large companies remain focused on their global commodity crops, and Dr. Vaught expects the hemp and cannabis industry will need to mature more before major competition enters the picture.
While many biotechnology companies have focused on GMO products, the public has voiced its dislike. Rather than targeting GMO strategies, FRB is looking for regenerative and sustainable approaches: improving soil health and reducing the use of pesticides.
Capital Allocation and Growth
Front Range Biosciences recently raised $8.5 million through an insider round. That capital is largely being deployed in three areas: production capacity, R&D, and relationships. FRB wants to build out its infrastructure to better serve its customers, build out its IP portfolio, and continue to develop meaningful relationships throughout the supply chain.
Dr. Vaught does anticipate that the company will need more capital to keep pace with its growth trajectory. He points to a solid group of investors that has supportive throughout the life of the company. As for the public markets, he sees an interesting opportunity but one that needs to be carefully considered. He and Hofmeister have spent their careers building companies, and they want to be prepared before making that move.
Over the company’s three-year history, it has been able to meet its goals, and Dr. Vaught expects 2019 to be a strong year for growth.
Challenges and Opportunities
Dr. Vaught anticipates the same challenges that any company undergoing rapid growth faces, namely executing and managing the growing team and operations. But, he sees major opportunity to support the growth of cannabis and hemp in new regions, and the opportunity to learn more about the non-psychoactive compounds of the plant.
To learn more, visit the Front Range Biosciences website. Listen to the entire interview:
