Announcements of all the seed and crop protection mergers and acquisitions during the past two to three years might have left some with a less-than-optimistic outlook as it relates to product innovation and commercialization and at what price.
But for Adrian Percy, Bayer global head of R&D for the Crop Science division, that couldn’t be further from the truth.
“I think we are in a golden age … because a lot of things are coming together right now,” Percy said during Bayer’s annual AgVocacy Forum, which took place Feb. 25-26 in Anaheim, California.
He noted the advancement of data-driven agriculture, plant breeding innovations and emphasis on understanding the soil microbiome.
Much of this work has only been going on since about 2013/14, he said, adding that it’s really early in the pipeline.
“The money that’s been invested will start to pay dividends in the next few years,” Percy said. “Then we will start to see a lot of new tools and approaches coming through the industry’s pipeline.”
The important thing, he said, is to get more investment in agriculture.
“[Agriculture has] lagged behind other industries in terms of the amount of investment,” Percy said, noting that there’s been a real shift change in the past couple years.
“I’d like to see even more money coming in, but with what we already have now, it’s going to be positive,” he said.
According to AgFunder, that investment is happening. In its “Agrifood Tech Investing Report: Mid Year Review 2017,” the company reported that agriculture biotechnology was the fourth-largest category it tracked in the first half of 2017 (H1); however year-over-year investment declined to $262 million and deal activity declined to 30 deals. Crop technologies still accounted for the majority of funding and deal activity. Here’s a brief excerpt from the report:
“Farmtech investment represented a quarter of total agrifood tech funding in H1-2017, reaching $1.13 billion, and accounting for seven of the year’s top 20 deals. The funding total represents a 56 percent year-over-year increase, but is still below the record-breaking 2015 when startups raised $1.3 billion in H1-2015.
Deal activity contracted 14 percent year-over-year to 138 deals, with some large and later stage deals pushing the total up.
“The segment saw a few extra exits during the half with Indian irrigation giant Jain acquiring Australian water management and IoT platform Observant, and Monsanto’s Climate Corp acquiring another irrigation-focused data startup (and portfolio company) HydroBio of the U.S.
The last summer acquisitions of Granular ($300m) and Blue River Tech ($305m) missed the cutoff for the H1 report, so we expect to report significantly more activity in the full year report.”
Bayer’s Percy said: “You can see that we are in a situation where technologies, such as new plant breeding innovations, are actually enabling small- and medium-sized companies to really make some progress. It’s probably healthier than it was five and 10 years ago because we didn’t have the investment that we are seeing today, through venture capital and private equity and science enabling companies to pop up and be quite successful.”