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CST Growth, LLC

1. What is CST Growth, LLC?

CST Growth is an early revenue-stage biotech company commercializing the agricultural uses of “PPFM” bacteria. These are commensal bacteria, present on the leaves and roots of virtually all plants. They secrete two plant hormones that are essential for plants and also secrete nitrogen. These 3 substances greatly increase the biomass and yields of crops, while protecting crops against stressors (drought, heat, insects, and microbial pathogens). Examples: 75% increase in yield of soybeans; 4-fold increase in biomass of rice plants (from which cellulosic ethanol can be extracted); 38% increase in yield of sugarcane; complete protection of corn plants from corn rootworms that damaged the control plants; and complete protection of rice plants from an otherwise-lethal fungus called Rhizoctonia solani (the cause of “sheath blight”).

2a. How was CST Growth created? Can you describe the relationships or university affiliations that were involved?

The technology was developed at the University of Maryland, which in 1995 filed the first of several issued patents. UMD’s Office of Technology Transfer (OTT) approached me to see if I might be interested in licensing the technology, because I had published journal articles on a matter tangentially related to the PPFMs. I was interested, and CST became the exclusive worldwide licensee on the patents.

2b. At what stage of the technology’s development did CST Growth first start collaborating with a university, and how were the researchers able to bring the technology to the marketplace?

The license was taken out in 2004. Up until that stage, the University had tested the PPFM bacteria in small field trials, but (a) the product had never been sold commercially, and (b) there had not been any large-scale, replicated, checkerboard-type field trials of the kind that large growers insist on seeing before trying out something new.

2c. Does CST Growth have an ongoing relationship with a university or its
researchers? What are the advantages to working with a university?

Yes, we have an ongoing relationship with the University of Maryland:
a. The inventor, Professor Mark Holland, is a wonderful colleague for exploring issues that come up (agricultural applications, industrial production, metes and bounds of the technology, etc.). He also comes to meetings with us, with important potential clients and collaborators.
b. Also, the University has a bioreactor research facility (at a separate location), and that organization has become our Contract Manufacturing Organization (CMO).

3. Would you briefly describe CST Growth’s business plan?

a. Continue providing samples of PPFMs for a series of large-scale replicated field trials on a fairly wide range (i) of food crops (soy, corn, cotton, strawberries, wheat, etc.) and (ii) of biofuel-oriented crops (jatropha, Salicornia, etc.)
b. The sales & marketing team will market the product to growers, growers’ cooperatives, and ag-related companies.
c. Additional marketing efforts will include (a) writing journal articles based on collaborative research with academic opinion leaders; (b) talks and poster presentations at industry-related conferences; manning booths at exhibits and trade shows, etc.
d. Apply for various state and federal grants for funds that will subsidize the ongoing R&D program.
e. Identify a potential corporate partner for an eventual trade sale.

4. What is the current status of CST Growth? In what publicly disclosed research and development efforts has CST Growth recently been engaged?

a. Status:
i. We have had our first modest revenues, selling to individual growers as well as to companies that sell bacterial inoculants (and, having seen the results of PPFMs in field trials, want to blend the PPFMs into their respective products).
ii. We are currently arranging for field trials in several regions of the globe, including South America and the Middle East.
iii. Several global, vertically-integrated ag companies have recently become interested in looking into how our product would fit within their own business models.
b. R&D efforts: Although this has not yet been publicly disclosed, nevertheless we are free to share with NYSTAR and with the public that research programs of the following nature are either in-progress, or planned for the near future, for the most part with academic scientists and/or USDA scientists:
i. Conduct a number of well-controlled studies on the ability of PPFMs to protect plants from:
• Common-place microbial pathogens (e.g., fusarium)
• Emerging pathogens that threaten the destruction of the entire world’s production of certain crops (e.g., the Uganda99 strain of wheat rust)
ii. Conduct a number of well-controlled studies on the ability of PPFMs to increase the production of biofuel feedstocks (thus helping with energy dependence, while lessening the extent to which crops have to be diverted from the food supply to (bio)fuel supply.

5. Who is on the CST Growth team?

• Richard M. Carlton, M.D., President & CEO. This is Dr. Carlton’s 2nd biotech startup.
• Mel Schuster, CFO and Senior V.P.
• John K. Tse, Chairman
• Mark Gruenewald, Director of Sales & Marketing. Mr. Gruenewald had been Regional Sales Director for the company that became Bayer Crop Sciences, and for the company that became Syngenta.

6. How was CST Growth named?

Those are the initials of the 3 founders.