Finance hurdle stalls conversion of Northland abattoir

NZ Life Science Hikurangi owner Scott Massey in the abattoir being converted so it can produce collagen from cattle hides for human burn victims and other medical uses. Photo / John Stone

The abattoir aims to add value in the future by making collagen bandages for burn victims, internal sutures which could be absorbed within the body and other high-value collagen products

Million-dollar costs to meet United States' rules for imports are holding up the conversion of a former Northland boutique abattoir into a facility capable of producing pharmaceutical grade collagen from cattle hides for human medical use.

Abattoir owner Scott Massey is seeking investment in the conversion project, which he believes could potentially see the facility conservatively earning $20 million annually through exports to the United States, where collagen retails for up to $30 a gram for use treating burns, providing wound patches and dealing with damaged veins and arteries.

Dave Anderson, his son Neil and Neil's partner Leah Stone set up the abattoir on about 16ha in Marua Rd at Hikurangi in 2015, killing stock for farmers and processing the meat so it could be sold at farmers' markets or over farm gates.

It was then known as the Oxville Farms abattoir and was renamed NZ Life Science Hikurangi when Massey, a Whangarei businessman, took over last year and started converting the facility for its new pharmaceutical role.

At that stage there were hopes that products derived from cattle processed by NZ Life Science Hikurangi could be used to produce human heart parts and other products for the billion-dollar US and other lucrative overseas medical markets.

But collagen production was the first objective, Massey told The Country, explaining how the abattoir building had been expanded to accommodate a hide splitter which would separate the leather in slaughtered cattle hides from the fatty tissue beneath.

The tissue went through a complex but low-intensity physical and biochemical process to produce high grade collagen.

After parting ways with advisers who had been with NZ Life Science last year, new experts had helped develop a process for the Hikurangi abattoir to make collagen and Massey had a sample of some produced at Lincoln University.

Adding value

While the retail price for the substance was high in the US, collagen exported by NZ Life Science Hikurangi would fetch around $3-$5 a gram at wholesale level.

Massey said the abattoir aimed to add value in the future by making collagen bandages for burn victims, internal sutures which could be absorbed within the body and other high-value collagen products.

As part of this strategy, NZ Life Science Hikurangi had formed an association with organic farmers who would provide cattle, run the slaughtering facility, deal with the carcases and provide Life Science with the hides it needed for collagen production.

The abattoir would deal only with cattle raised on organic/closed herd certified farms and could not provide the slaughtering service offered to the public under its previous Oxville Farms' ownership.

Massey said NZ Life Science Hikurangi was also developing a relationship with Ngatiwai because the abattoir was in their rohe and the iwi had shown interest in the collagen export project for business, environmental and employment reasons since it was launched last year.¦