Tragedy struck Thursday, November 8, 2012, when an explosion destroyed Neptune Technologies & Bioressources Inc.’s production facility in Sherbrooke, Québec. The blast and ensuing fire claimed the lives of 2 employees, injured 19, and destroyed the plant.
At the time, Neptune was the pioneer of omega-3-rich krill oil, an extract that, unlike fish oil, contains phospholipids and a powerful antioxidant called astaxanthin. Neptune patented the extraction method and composition of its krill oil, making it a highly protected product in the marketplace. After the accident at its plant, though, the loss of life and operating capability had a profound impact on the company, forcing it to regroup.
But Neptune is proving that oil always rises to the top, as it reopened its plant in July 2014 on its way to a full comeback. “We’re a very strong company; we’re fighters,” says Andre Godin, the organization’s CEO, CFO, and interim president. “Now, as a pioneer of this industry, our goal is to recapture our position as world leader.” Take a peak into the numbers that chart Godin’s success and how he’s putting the resilient biotech business back ahead.
After earning his CPA designation, Godin began his career as a corporate controller at a generic pharmaceutical company. The work piqued his interest in the medical and health sector, but he yearned for something less derivative. “Everything we were doing was anything but innovation because you were taking a recipe and replicating what someone else created,” he says.
Godin became very interested in the biopharmaceutical field, and when an opportunity came to join Neptune—a micro-cap company at the time, with basically no sales—he jumped at the opportunity. Unlike his previous employer, Neptune was bringing a brand-new product to the market: krill oil.
“We gave birth to the industry back in the early 2000s,” Godin says. He started at the company as a general manager, but soon after that, he became CFO. The company was growing but was only listed on the Toronto Stock Exchange (TSX), so it needed a full-time CFO who could dedicate substantial attention to getting money from the financial markets. Godin has since raised almost $100 million.
2 spin-off companies
As Neptune grew and began to produce more and more krill oil, the company found it increasingly difficult to juggle the retail realities of its work alongside the development of new products and drugs. So, in 2008, Neptune spun off two biotech subsidiaries: Acasti Pharma Inc. and NeuroBioPharm. Godin became the CFO of both.
Acasti has a prescription-drug candidate, derived from krill oil, being developed for the prevention and treatment of cardiometabolic disorders. Along with Neptune, it is listed on the TSX, the Venture Exchange, and the NASDAQ. Recently, the company raised $25 million to boost its drug-development program.
150 metric tons
Losing the Sherbrooke plant was a big step backward. Neptune lost market share, and in the intervening years, it tried to retain 70 percent of its revenue by buying and selling krill oil that it hadn’t produced. Though this lowered profit margins, it allowed the organization to retain much of its revenue while it worked to reopen its plant.
The fire from the explosion had ruined the old plant, but fortunately Neptune was building an expansion at the time. So it built its new plant within the expansion so that it wouldn’t have to start from scratch.
“We’re in the ramp-up period,” Godin says. The company has gone from producing 50 metric tons of krill oil products when its plant reopened to, most recently, 100 metric tons, and as its plant moves closer to full capacity, it will be able to produce 150 metric tons.
While waiting for the relaunch of its plant, Neptune was able to analyze how the market and its competition were evolving. “Two thousand fifteen is really the comeback year for us,” Godin says. Moving back to its own oil, his company has been able to craft a commercial strategy that includes three new oil formulas in addition to its original product.
Infused with clinically proven ingredients, the three new oils—named NKO Flex, NKO Beat, and NKO Focus, meant to help joints and bones, heart circulation, and the brain and eyes, respectively—will extend the Neptune product line and continue its tradition of innovation. “What makes Neptune great, as opposed to the competition—mainly, it’s our intellectual property,” Godin says.
The company’s IP portfolio also includes protections for its extraction process and for the formula of its market-premium krill oil, NKO, and each of its products undergoes careful clinical analysis that demonstrates its health benefits. “It needs to be a science-based product, or we won’t release it,” Godin says.
Today, Godin acts as the CFO, CEO, and president of Neptune and its two subsidiaries. “Every day is pretty crazy,” he says. “At the end of the day, I try to find the right people to surround me because a successful company cannot be a one-man show.”
With his team, Godin was able to raise $30 million in equity to kick-start Neptune’s comeback, and daily he’s thankful for the employees and shareholders who continued to support the company during its rebound. “The company has gone through a difficult time, but now it’s behind us,” he says. “We’re coming back stronger than ever.”