Enzymes that can convert sugars into feedstocks for oil and gas, drinking straws made of biodegradable polymers, near-unbreakable mycelium fibres used in everything from clothing to satellites - while these technologies sound like an engineer’s fantasy, they actually exist and are part of the dynamic field of synthetic biology, or synbio.

Within the sector, Asia presents an incredible opportunity, as we learned from a panel at SynBioBeta 2023: The Global Synthetic Biology Conference.
 

Understanding synthetic biology

Broadly speaking, synbio refers to the use of engineering principles to alter the DNA of organic substances, imbuing them with new properties that can be used to bio-manufacture new compounds such as the ones described above.

Synbio is not a new field, but it has been gaining significant traction in the past few years. For example, Solugen, a company that uses enzymes and catalysts to create critical industrial materials more efficiently and sustainably than conventional means, recently raised a US$200m Series D round with a US$2b valuation; and RWDC, a producer of biodegradable replacements for single-use plastics, is partnering with multinational companies such as Kimberly-Clark to quickly scale the production and use of their products.

This acceleration can be attributed to two factors. The first is technological – breakthroughs such as CRISPR have made it easier and quicker to engineer changes at the molecular level. The second is existential – because synbio solutions incur a much lower carbon cost compared to their conventional counterparts, governments and corporates are increasingly seeing synbio as a needle-mover for our sustainability goals. As a result, brand-name investors such as Khosla Ventures, GIC, and Temasek are investing heavily, and the synbio market is expected to more than quadruple to US$55.37b by 2030.

But more can be done to accelerate the growth of synbio, especially in Asia. To discuss this, the Singapore Economic Development Board organized a panel at SynBioBeta 2023: The Global Synthetic Biology Conference, in May 2023, comprising some of the most influential voices in synbio today. Here are their takeaways.

For synbio, scale is the name of the game

It’s one thing to develop an exciting synbio solution; it’s another to take the solution beyond the lab. While breakthroughs like CRISPR have accelerated the development of scientific breakthroughs at the lab-scale, there is no equivalent technology or policy that has made it easier for synbio startups to scale.

Dr Xinhong Lim, Managing Director of Vickers Ventures and Chief Strategy Officer of RWDC, agrees, “The feedback from many of the consumer brand owners that we work with, is that they may have an initial engagement with you [as a synbio startup] but there’s very little else they will do if there is no line of sight to commercially viable production volumes, quality, and unit economics.”

This is a non-trivial challenge – to scale, synbio products and solutions require novel production infrastructure that is not readily available and often incur massive, fixed costs upfront. This is when companies find themselves entering what Chakrabarti calls the valley of death where they have matured beyond pre-seed and seed-stage funding but are still considered too risky by later-stage venture investors and hence cannot scale.
 

Governments can be the catalysts synbio needs

All four panellists agreed that synbio’s scale issue cannot be addressed by industry alone, and that governments would play an important role in de-risking investments and providing commercial-scale infrastructure.

Chakrabarti argued that governments could specifically explore de-risking funding mechanisms for mid-stage synbio companies in the valley of death. For example, the US Department of Energy provides loan guarantees for promising companies tackling climate change, which in turn give financial institutions the assurance needed to approve larger loans.

Separately, governments should consider providing shared “plug and play” infrastructure to help synbio startups reach commercial scale quickly. Ow Kai Onn, Vice President and Head of Chemicals and Materials at the EDB, shared that Singapore was already working on this for alternative proteins production, “We haven’t yet solved the issue at the 100,000 to 200,000 litre bioreactor level, but we are working with manufacturers in Singapore to create significant bioreactor capacity so that companies big or small can prove to a buyer that it can produce commercial volumes.” As an example, Mr Ow mentioned Esco Aster, who is currently designing three bioreactor trains with a combined capacity of 18,000 litres for cell culture operations, within a larger 50,000 litre “bioreactor farm.”

Gwen Cheni, Partner at Khosla Ventures and founder of a stealth-stage synbio startup, added that governments can provide highly practical assistance, such as free lab space for synbio startups.

All eyes are on Asia

Asia was unanimously agreed to be the growth market for synbio. “Asia accounts for almost half the global demand¹ for specialty chemicals,” said Ow. This demand is driven by major end-use industries such as pharmaceuticals and flavours and fragrances in China, India, Indonesia, and other large end-markets. Increasing output from these industries, coupled with the growing pressure to reduce carbon footprints, will generate significant demand for synbio solutions.

Beyond market demand, “Southeast Asia is [also] a great place to site manufacturing operations,” according to Dr Lim, because of its concentration of major plant oil sources for bio-feedstock. Additionally, some of synbio’s largest likely customers “want to produce plastics close to where [both] the feedstocks and consumers are.” 
 

Singapore can be synbio’s gateway to Asia

For companies looking to scaling synbio in Asia, Singapore was mentioned as an ideal partner. Chakrabarti shared, “It’s completely impossible for us to go after Southeast Asia without having a home base. Singapore, out of all the countries we were evaluating, was the best choice because of its stable business environment, talent pool for R&D and trade linkages.”

Ow suggested that Singapore’s value was not just as a location for regional headquarters, but also as a platform to achieve commercial success. For example, the Agency for Science, Technology and Research (A*STAR), Singapore’s national research agency, can provide novel in-kind support such as lab space, equipment sharing, and even embed A*STAR scientists with companies to accelerate R&D and commercialisation. Ow added that the government is building infrastructure for more synbio applications beyond cultivated meat, such as cell gene therapy.

While it will be some time before synbio can achieve the scale it needs to change the world, it’s clear that much of the groundwork is being laid today. 

 

Sources: ¹ Grand View Research 2022