Two Harbors startup hopes to develop new products from birch bark wasteIf Brian Garhofer has his way, Two Harbors could soon become a major player in the cosmetic, dietary supplement and pharmaceutical industries. Garhofer plans to continue an innovative process, started and subsequently abandoned in Two Harbors nearly two decades ago, in which birch bark extracts are put to commercial use.
By: Tom Olsen, Lake County News Chronicle
If Brian Garhofer has his way, Two Harbors could soon become a major player in the cosmetic, dietary supplement and pharmaceutical industries.
Garhofer plans to continue an innovative process, started and subsequently abandoned in Two Harbors nearly two decades ago, in which birch bark extracts are put to commercial use.
“Even though we’re somewhat of a startup, we’re based on technology developed over 15 years ago,” Garhofer said of his new business, the Actives Factory, which was launched in conjunction with the University of Minnesota.
Plans call for the startup to extract and synthesize naturally occurring chemicals from birch bark, which is typically burned as a waste product at paper mills. The extracts can be used as ingredients in healthier pharmaceuticals and cosmetics.
Garhofer said he expects production to begin around May with process testing and initial development. In the future, if the project is successful, the plant could employ up to 12 people, he said.
Dr. Pavel Krasutsky, the director of the chemical extractives program at the University of Minnesota Natural Resources Research Institute in Duluth, has spent more than 15 years developing the process that allows Garhofer’s company to extract chemicals from bark.
"The birch tree is the oldest of all species of trees and it grows in the most severe of climates," Krasutsky said. "Over hundreds of thousands of years the birch has evolved to use chemicals to protect itself from bacteria, fungus and viruses. Its first barrier of defense is its bark. Use of natural chemicals is well established in Europe and Asia, but use in the United States is just beginning to develop."
Birch bark extracts contain three compounds that are important to researchers and developers: betulin, lupeol and betulinic acid. It is believed that these compounds can help reduce cholesterol and blood pressure, treat infections and stimulate the immune system.
The benefits offered by birch bark extracts make it a project worth undertaking, Garhofer said.
“It has certain characteristics that are not found in other products,” he explained. “Companies are looking for natural alternatives. Birch actives are anti-inflammatory, anti-viral, anti-bacterial, anti-fungi characteristic. It’s the anti-drug.”
The Actives Factory will operate out of a building formerly occupied by NaturNorth, located off of Fairgrounds Road.
NaturNorth was a similar venture designed to make use of birch waste, so much of the technology is already in place and the process is far from new.
Garhofer said the Actives Factory will be able to obtain the bark from birch logs that are shipped to local paper mills. He expects all birch to be grown in sustainably managed areas in Northern Minnesota and Northern Wisconsin.
While recent reports have suggested that birch trees are dying along the North Shore, no one seems too worried about the ability to maintain birch cover.
Harley Nelson, a North Shore resource specialist for the state Department of Natural Resources, said that areas along the shore, where there has been significant business and residential development, have seen a sharp decline in birch, but more inland areas should be safe.
While Garhofer said his company could always get a birch supply from Canada if necessary, Nelson said he expects birch to remain in Northern Minnesota.
“Birch should always be a component of the forest,” Nelson said. “It needs to be an important part of the fabric of the forest landscape.”
Garhofer, confident in the abilities of birch, said he thinks the Actives Factory can help spawn a new age of pharmaceutical and cosmetic products.
“If we’re successful we’ll go on with our processing capabilities and hopefully create multiple natural product companies. Soaps, cosmetics, health products; it’s really about trying to create a natural products industry.”