Santa Barbara, Calif.-based Apeel Sciences is scaling up manufacturing of Edipeel, its plant-based post-harvest treatment designed to double the shelf life of produce.
The company has achieved that result with more than two dozen commodities, said CEO James Rogers, and a recent infusion of capital — $33 million in Series B financing — will enable the company to continue developing the product for use in those different categories.
Apeel already has customers using Edipeel. The product is delivered as a powder to the location of the produce — a packinghouse, for example — and then reconstituted as a liquid before being applied with a spray bar, or via other methods, to the vegetables or fruit, which are then dried with an air knife.
“When (Edipeel) dries, it leaves behind this imperceptibly thin barrier of plant material on the outside of the produce, and that thin barrier slows down the rate that water evaporates out of the produce, and it slows down the rate that oxygen gets in,” Rogers said.
With about two dozen companies in its sales process, Apeel expects to be profitable in 2017 as it ramps up production.
“We will begin having large volumes of our materials available to select partners in Q1 of next year,” Rogers said. “That’s not to say that we’re going to be selling it widely, (as) we really work with specific customers to deliver very particular business propositions that are relevant to their business, but you’ll start seeing this product applied at massive scales in Q1 of next year.”
Edipeel is currently applied to hundreds of pounds of produce per week, Rogers said in an e-mail, but by the second quarter of 2017 will be applied to thousands of pounds of produce per day.
Rogers, who founded the company, said the idea behind the development of Edipeel was to reduce the amount of refrigeration needed for produce.
“We looked at this and said, ‘Hey, maybe there’s another way besides just cranking down the temperature on everything and burning all this oil,’” Rogers said. “One way that our customers realize the benefits of our product is by reducing cold storage and shipping costs of produce because they don’t need to store it at as low of a temperature.”
Storing at higher temperatures has benefits in terms of food quality and taste, too, Rogers said.
With Edipeel positioned as an alternative to refrigeration — and waxes — Apeel takes the costs of those activities into account for pricing.
“When we work with a new vertical, in our initial pilot agreements with each of those produce categories we price at a discount relative to modified atmosphere, which incentivizes our partners to work with us and also incentivizes product adoption,” Rogers said, “and then after we’ve proven out the value with the different customers, then we develop a value-based pricing approach with new customers in that segment.”
Rogers indicated that growers and retailers to whom he has talked about the product have been extremely positive.
“The response has been overwhelming, really,” Rogers said. “Normally we’re first met with the response of, ‘Yeah, right, this can’t be real,’ and the next one is, ‘Oh, wow, this is really interesting,’ and the next one’s like, ‘Oh, how do I get this?’ So the response has really been amazing.”
Apeel declined to provide, at this relatively early stage, the names of any companies using the product.
One challenge Rogers cited in the development of Edipeel was classification of the product for regulatory purposes.
“Typically when you talk to someone in ag, they’ll ask you, ‘Hey, what are the active components of your product?’ and we don’t have any active components,” Rogers said. “What we have is a combination of inactive structural building blocks that, by virtue of the structures they form, give us the properties — the physical barrier properties — that we’re looking for. So from a regulatory perspective, it’s been a challenge because there’s not a lot out there in terms of advanced barrier solutions.”
The company has gotten that question resolved. Edipeel falls under food additive regulations as a surface finishing agent, Rogers said.
Edipeel is the subject of a number of patents that are not yet published. Apeel has also submitted an application to the Organic Materials Review Institute to be approved for use on organic food and expects a determination in April.
The company is also working on a pre-harvest treatment, Invisipeel, that it sees as an alternative to pesticides. That product is still in development, but Rogers said he is excited about it.
“These pests identify fruits and vegetables as food sources from the particular molecules that are found on that food surface, and so simply by taking molecules that aren’t typically seen by these pests and applying them to the outside of the produce, we’re able to fool these bugs into not realizing that what they’re sitting on is a food source,” Rogers said. “It’s an entirely different mode of action relative to a traditional pesticide.”
Editor's note: The time lapse video shows, along with other produce items, a strawberry treated with Edipeel and an untreated strawberry. The video was recorded under international retail shelf life testing standards – 68 degrees Fahrenheit and 60% relative humidity, according to Apeel. The strawberries in the video came straight from the field directly after harvest and had never been refrigerated.