BioHarvest signs 20-ton fragrance supply deal worth up to $30M

BioHarvest Sciences Inc. (NASDAQ: BHST) (FSE: 8MV0) announced an exclusive manufacturing and supply agreement with an undisclosed partner based in the United Arab Emirates to produce a rare, endangered fragrance plant cell culture, with production volumes totaling 20 metric tons.

The agreement, which extends an existing arrangement through 2027 and 2028, is estimated to generate between $20 million and $30 million in revenue upon completion of delivery. BioHarvest said it plans to begin limited production in the first half of 2027, with product specifications to be finalized over the coming months.

Under the terms of the deal, BioHarvest will serve as the exclusive manufacturer of a proprietary fragrance cell culture composition. The identity of both the plant compound and the partner firm are protected under a non-disclosure agreement.

The company holds a 20% ownership stake in the developed composition. BioHarvest said it successfully completed Stage 1 of the program in March, which it described as the first-ever creation of a stable cell culture for the plant in question, followed by a Stage 2 contract in May.

The fragrance compound contains sesquiterpenes and chromones, natural plant compounds used in luxury scents for their slow evaporation and long-lasting qualities. Premium grades of the raw material are reported to command prices exceeding tens of thousands of dollars per kilogram.

BioHarvest chief executive Ilan Sobel said the agreement validates the company's Botanical Synthesis platform as a manufacturing solution for rare plant-derived molecules and indicated the company intends to pursue additional contracts in the fragrance sector as part of its contract development and manufacturing organization business.

Revenue recognition is contingent on product delivery and the compound meeting specific sensory parameters. The company noted there is no guarantee the final product will be suitable for commercial purposes.

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