A Baltimore startup is establishing a lab in Italy this summer in hopes of saving the Italian olive oil industry from a disease that has already killed millions of trees.
Auxergen is partnering with the University of Bari to create an Italian branch of the company at the TECNOPOLIS Science & Technology Park owned by the higher-education institution. The startup, founded by Johns Hopkins University researcher Ting-Yu Yeh, is seeking European Union approval to use a virus to fight a bacteria that has killed over 21 million olive trees in just a few years.
CEO Gregory Contreras said there are currently no treatments on the market for the disease, leading many farms to rely on quarantining crops, burning down infected trees to prevent the disease from spreading or trying to kill the insects that spread Xylella fastidiosa, the bacteria infecting olive trees. When the Auxergen team drove through southern Italy earlier this year, they saw fields full of desiccated trees without leaves. The damage from the disease has already cost Italy over $1 billion in losses. Contreras plans to establish Auxergen Italy by Aug. 1.
“There is a sense of like hopelessness because a lot of people turned up their hands saying ‘it’s just global warming or something like that,”’ Contreras said. “We're excited that we're able to say no, this is a bacterial blight. It's a specific disease and we can come in with a specific cure.”
Auxergen’s cure is a special kind of virus, called a phage, that kills bacteria. Yeh has programmed a phage to target Xylella, allowing farmers to deal with the disease directly. Phages have been used as a therapy to treat diseases for decades in Eastern Europe, but they are not as commonly used in the United States.
The firm is raising a $5 million round to develop and launch the phage product, Contreras said. The company hopes to get support from local technology funders such as TEDCO and the Maryland Momentum Fund. The company has experience in the venture capital markets and has raised $1.1 million since its founding in 2015.
Auxergen chose Italy as its primary market partly because the Italian olive oil market has many small boutique producers. The more decentralized market means it's easier for Auxergen to establish a presence there rather than in countries like Greece or Spain, which are dominated by just a few companies. Contreras plans to work with Italy's Coldiretti, a cooperative of 1.6 million farmers.
The expansion to Italy is coupled with Auxergen’s growth in Baltimore. The firm is upgrading from 200 square feet to 900 square feet within downtown Baltimore's Institute of Marine and Environmental Technology. It's hiring seven more scientists, split between Italy and Maryland.
Auxergen’s product has commercial potential outside of the olive industry. The same bacteria causes illnesses in grape trees and citrus plants. One illness caused by Xyella, Pierce’s disease, costs the state of California $100 million worth of grape plants every year. Contreras believes Auxergen’s phage will get on the market in 2027, but it may become available to farmers earlier. If the firm receives an emergency use authorization, it will launch the product in 2025 in the European Union.
Yeh launched Auxergen to express his creativity and experiment with creating commercial products he couldn’t make through his research at Hopkins. Academia encourages researchers to go deeply into a single subject, Yeh said, while being an entrepreneur has allowed him to explore a variety of products. Auxergen has seven products outside of the olive oil phage in its research pipeline, ranging from skincare lotions to appetite suppressants using the cannabinoid receptors in the brain.
"You can apply your creativity to solve a real-world problem," Yeh said. "That's what's joyful about being an entrepreneur."
