BioHarvest Sciences Inc (NASDAQ:BHST, FRA:8MV0) has secured a $1.2 million Stage 2 contract to develop a rare scent-producing plant compound for the global fragrance industry, marking a key step in the firm’s push into a market the company values at $23 billion.
The contract, awarded by a United Arab Emirates-based investment group, is part of a multi-stage development program for a fragrance raw material described as among the most valuable in the world, with premium grades fetching tens of thousands of dollars per kilogram.
The identity of the plant compound and the partner firm are protected under a non-disclosure agreement.
The deal follows the completion of Stage 1 in March 2026, in which BioHarvest produced a stable cell bank of a unique cell culture-based composition containing rare molecules. Stage 2, which will take approximately six to nine months, is expected to yield enough material for commercial trials.
Under the agreement, BioHarvest retains 20% ownership of successfully developed compositions and will also serve as the manufacturing entity, establishing what the company described as a long-term, royalty-driven revenue model.
"A Stage 2 contract means that we have crossed the tallest technological hurdle of this unprecedented research and development journey," said CEO Zaki Rakib. The company is targeting production readiness in the second half of 2027, aligned with the planned commissioning of a new production facility.
The UAE partner's major principal said the contract was awarded following encouragement from Stage 1 results, and that a commercialization program designed to bring the product to market is expected to begin in the second half of 2027.
BioHarvest operates through its contract development and manufacturing organization, or CDMO, division using what it calls Botanical Synthesis technology, which replicates and scales plant-based molecules without cultivating the plants themselves. The company said it expects the contract to attract additional customers for future fragrance programs.
The global scents and fragrances industry is valued at approximately $58.9 billion, with the premium fragrance segment representing the $23 billion opportunity BioHarvest is targeting.
Shares of BioHarvest added 6% on the announcement.