Archive for the ‘Biosciences’ Category
Friday, March 12th, 2010
Fresh off its impressive $14 million Series B round in 2009, advanced materials start-up Novomer picked up further momentum after it announced a development agreement with investor DSM, a materials science company based in the Netherlands. Novomer’s catalyst technology enables production of plastics, polymers and other fine chemicals from renewable feedstocks like CO and CO2. As we’ve stated before (see the April 6, 2009 LRNJ and the August 31, 2009 LRNJ – client registration required), the company is a leader in a relatively unpopulated field: Other than U.S.-based Empower Materials (see the March 16, 2009 LRNJ - client registration required), Norway-based Norner Innovation (see the March 30, 2009 LRNJ - client registration required), and a few players in Asia, there are very few developers of carbon-dioxide-based polymers outside of university labs.
Novomer and its new partner, DSM, plan to focus on creating carbon-dioxide-based polymer coatings and inks for food and beverage, automotive, and industrial applications. The match between Novomer and DSM makes perfect sense, as their technologies and needs complement one another. Namely, Novomer’s carbon-based polymer production technology dovetails neatly with DSM’s deep experience in developing and selling petroleum-based versions of the polymers. This new agreement and its amenable licensing business model make it safe to predict that Novomer is starting to pull away from its competitors. Clients with needs for environmentally friendly polymers should engage.
Tags: DSM, Novomer
Posted in Biosciences, Carbon, Nanomaterials |
Friday, March 5th, 2010
The “food versus fuel” meme that spread like wildfire in 2008 arose from fears that record oil prices would spark a scenario in which modern economies would be forced to choose between crops for food and crops for alternative fuels. It was a simplistic notion based more on hype than science or economics. It also ignored the environmental shortcomings of petroleum-based fuels.
Most scientists agree that the rising price of food in 2008 wasn’t caused by actual shortages. Instead, it derived from speculation, hype, a relatively poor growing season, and ironically, the high cost of petroleum fuel, which made transporting crops to market more costly.
Contrary to the false dichotomy of “food versus fuel” there are many reasons for actively seeking out crops that can serve as both food and fuel.
- Increasing crop yields from existing farmland is preferable to expanding agriculture. Expanding agricultural lands either requires repurposing arable lands and losing their environmental benefits, or increasing irrigation of dry land, which will exacerbate a mounting water crisis (see the report “Malthus Returns: Solving the Unsustainable Agricultural Water Demand Conundrum” – client registration required). Planting food crops and using them for energy allows us to exploit the plant as fuel when food is plentiful, or divert it from energy when food is scarce. If we only plant energy crops, or replace food crops currently being cultivated with energy crops, we lose that option and put our food supply at greater risk.
- Crops grown purposely for biofuel poses economic issues. Growing crops exclusively to provide biofuel feedstocks requires farmers to invest in new seeds, new implements, additional maintenance, fuel, and labor. This requires long-term contracts with farmers in order to ensure a steady biomass supply that justifies the establishment of biorefineries nearby. Dedicated crops require additional tilling, planting, fertilizing, irrigation, and harvesting. All of this increases the cost of the biomass, making it more difficult to produce economically.
- Growing fuel crops on non-arable land is costly too. Planting energy crops on non-arable land requires an even bigger investment in cultivation. There’s a reason why crops aren’t grown on non-arable land: The soil quality is too poor, there is too little rainfall, the area is inaccessible, etc. So in addition to the challenges named above, non-food crops on underused lands lack roads, rail, farmers, fueling stations, and other infrastructure needed to cost-effectively transport this biomass to market.
- Agricultural and forest waste are the most economical and environmentally friendly sources of biomass. As we point out in our report (Biofuels’ and Biomaterials’ Path to Petroleum Parity – client registration required), the vast majority (70% to 90%) of the mass comprising food crops comes from non-food sections of the plant. It’s the stalks, leaves, and other parts that we do not eat. Taking advantage of this biomass requires no additional water, fertilizer, or labor. Plus, it can be transported, processed, and distributed alongside food, which makes more sense environmentally and economically than developing new crop species and fields.
There are certainly exceptions to the points above. There is some risk that biofuel crops could increase food costs, for instance, and specific sites exist where energy crops will work. In the vast majority of cases, however, improving utilization of crops we already cultivate for food (in particular, by recovering the non-food portion of the plant) is more viable from the perspective of the environment, food security, and biofuel economics.
Posted in Biosciences |
Friday, February 26th, 2010
 Click on image to open larger version. Petroleum’s vast scale and energy density moves more mass today than any other human-generated resource. As the percentages in the vertical axis show, the 159 liters that comprise an average barrel of oil distribute to provide 75 liters of gasoline, 37 liters of diesel, and 16 liters of jet fuel. The remainder goes to produce other fuels like propane, and non-fuel materials like petrochemical feedstocks, and asphalt.
In terms of energy, a single barrel contains 6.1 gigajoules, or the rough equivalent to the energy contained in one ton of dry biomass. Depending on the crop, cultivation, and rainfall, a typical hectare of land (2.5 acres or 10,000 square meters) might produce the equivalent of 10 barrels of oil.
So will biofuels and biomaterials ever represent more than a drop in the barrel? Today, they replace a vanishingly small amount of petroleum products – just 0.16%, by our count. That’s partially because many first-generation products, like bioethanol fuel and starch-based plastics only approximate the performance of the petroleum-based chemicals that they aim to replace – and almost invariably at higher cost.
As the horizontal axis illustrates, if biomaterials and biofuels reach their maximum substitution potential with today’s technology, they could conceivably replace 92 percent of the products derived from a single barrel of oil – or about 4.8 trillion liters of petroleum annually.
In theory, of course, new technologies yet to be developed could produce biologically-based replacements for all petroleum, which is itself derived from biomass. However, realizing this potential will take more than technological innovation. These new materials will also need to compete with petroleum in terms of cost and scale.
Source: Lux Research report “Biofuels’ and Biomaterials’ Path to Petroleum Parity” (client registration required). To learn more about this graphic and related intelligence from Lux Research, click here.
Posted in Biosciences |
Friday, February 12th, 2010
In a highly anticipated speech, the U.K.’s chief scientist, John Beddington recently told participants at the Oxford Farming Conference (OFC) that in order to deal with rising human population, the world and the U.K. must turn to genetically-modified (GM) crops and nanotechnology. In addition to decades of opposition to GM foods, activists in the U.K. have opposed nanotechnology in food, and the House of Lords recently issued a scathing report on food industry secrecy (see the January 22, 2008 LRNJ and the January 12, 2010 LRBJ – client registration required). The statements were nothing new from Beddington, but still highly controversial in a country where environmentalists such as Prince Charles have decried GM and nanotechnology because of, as the Guardian put it, ”the risk of upsetting delicate ecosystems in nature.”
Astute observers will note that upset ecosystems are precisely the reason that Beddington was calling for new food technologies. The ongoing debates over food, fuel, and climate are highly intertwined and show that there will inevitably be tradeoffs between environmental ideals. Despite organic foods’ ostensible wholesomeness, they cannot be produced in sufficient quantity to feed the world’s burgeoning population. Despite biofuels’ upward pressure on food prices, they can be an environmentally superior alternative to petroleum if they do not come from crops grown on former forest land. And despite environmentalist fretting about GM crops, these crops have never been shown to harm humans who consume them or the plants and animals in the environment. As the climate debate evolves post-Copenhagen, look for the role of biofuels and GM plants to shift to a more positive tenor as more thought-leaders and activists bow to these realities – much as, for instance, some environmental groups have swallowed their initial distaste to embrace nuclear power in the face of climate change worries.
Posted in Biosciences, Nanomaterials |
Friday, January 22nd, 2010
We recently discussed the use of nanotechnology in oil and gas, as well as other industries in a recent panel session at the First Kuwait Small to Medium Oil Industries Conference. Hosted by Sheikh Ahmad Al-Abdullah Al-Ahmad Al-Jaber Al-Sabah, the Minister of Oil, Minister of Information, and the Chairman of the Kuwaiti Petroleum Corporation, the conference intended to not only expand the role of small and medium-sized businesses in Kuwait’s oil industry, but in other industries as well.
By fostering entrepreneurship and development of new technology, Kuwait hopes to diversify its oil-dependent economy by exploring new markets driven by science and technology, and by reducing reliance on a few large organizations in favor of a more balanced ecosystem comprised of businesses of all sizes. To help advance these goals, the Sheikh announced an $87 billion program.
The audience itself posed challenging questions to many of the local speakers, revealing that there is an undercurrent of frustration with the centralization of power in the economy – the same centralization that the Sheikh’s program would address with funds for smaller businesses. Regarding the vision of a new, technologically-powered economy, one woman asked, ”Where is the strategy? Where are the leaders?” Another demanded to know “Whatever happened to privatization?”
In one particularly heated exchange, a financier asked a representative of Kuwait’s PIC Corporation, ”Why are you (PIC) subsidizing Dow Chemicals with cheap feedstock instead of using local companies and supporting our private sector?” The PIC manager replied, “If you can show me one local company, anywhere in the Gulf, that has run hundreds of polyethylene plants and who invented the technology, I will work with them. But there are none.”
The growing momentum behind opening and diversifying the economy was striking – and it poses opportunities and threats for the downstream petrochemical industry in particular. For example, as petrochemical giants like Dow and BASF try to maintain their hold on downstream processing and refining, they would do well to contemplate what happened to international oil companies (IOCs) like ExxonMobil and BP who had invested expertise and capital to pursue upstream exploration and production. Then, as national oil companies (NOCs) developed their own R&D expertise, they were able to increase pressure on and ultimately oust the IOCs, keeping the lion’s share of oil revenue to themselves.
Societal pressure is now on to repeat the performance in downstream industries, and retain more of the value of end products like polyethylene as well. While this transition will take years to unfold, it will not take decades: clients should pay close attention to Kuwait, Qatar, and other Gulf states that are rapidly evolving their economies using advanced nano-, bio-, water, power, and solar technologies as their roadmap.
Posted in Biosciences, Nanomaterials |
Friday, January 1st, 2010
The foundation of collaboration in synthetic biology may be cracking, specifically where development of bioethics standards for safety and security are concerned.
Synthetic biology’s de facto industry group, the International Association of Synthetic Biology (IASB), has been the major driver of such standards. Until recently, its efforts to develop standards for bioethics safety and security (BESS) culminated in a report released at a meeting in Munich in 2008. It had relied on what might be termed an open-source approach, using publicly available data as the basis for assessing risk. According to IASB guidelines, all incoming DNA sequence orders must be compared to the gene sequences stored at GenBank, the global online database that provides the most comprehensive repository of gene data. If a customer’s sequence completely or nearly matched a gene known to be pathogenic – a smallpox gene, for example – then a human subject matter expert (SME) would step in to evaluate the risk potential. The SME could then order a background check on the customer, contact a bioweapons expert through the IASB, or take other actions to ensure the legitimacy and safety of the customer’s research. The final guidelines were announced on November 3.
So far, so good. However, two leading gene synthesis companies, DNA2.0 and Geneart, broke with the IASB in November to form the International Gene Synthesis Consortium (IGSC) and promote their own set of standards. Blue Heron Biotechnology, GenScript and Integrated DNA Technologies have since joined them.
The IGSC is establishing a closed system, where members could draw on a database built on public sources like GenBank as well as proprietary data and other tools. In addition, IGSC’s model reduces or eliminates the manual SME work that the IASB method requires. Moreover, Geneart is the leader among a small group of companies – including Febit, Ginkgo BioWorks, Biosearch Technologies and Sutro Biopharma – that started a new industry group this month, the Synthetic Biology Industry Association (SynBIA). While the organization is only now communicating its mission, it claims it will collaborate with the IASB, and even endorse the IASB standard. Even so, it’s hard to see the move as an extension of the IASB, rather than a break.
So what’s behind the growing rift? To get one perspective, we spoke with Stephen Maurer of the Goldman School of Public Policy at the University of California Berkeley. Maurer, who helped the IASB develop its standards program, noted that the consortium claims its membership will be limited to “significant” companies, which means that a smaller number of more powerful organizations will be free to make decisions and move ahead without having to build broad consensus like the more inclusive IASB. Indeed, DNA2.0 underscores that the IGSC’s five members represent 80% of global gene synthesis capacity.
More importantly, the IGSC’s more automated approach would lower costs for members (at the expense of quality, Maurer argued), while smaller companies would still need to rely on slower, higher-cost human SMEs – or else join the standard without the benefit of a vote on its content.
Maurer added, “DNA2.0 has in the past told me that they consider the act of cross-checking the customer’s order to be reverse engineering” and a breach of customer trade secrets. However, he doesn’t see that current trade secret law actually requires this result, and that if companies want to take the extra trouble of having SMEs examine customer sequences by hand there is no legal reason why they cannot properly do so. Indeed, U.S. regulatory agencies like the Environmental Protection Agency (EPA) and Food & Drug Administration (FDA) regularly protect such confidential business information.
While this arguably minor point of contention among the nascent industry’s players could be dismissed as growing pains, the number and severity of disagreements evident in these actions indicate a major shift is underway. Firstly, the IGSC’s actions build competitive barriers to smaller companies entering the gene synthesis space. That counters the trend of advancing technologies that have lowered barriers of entry. Non-governmental organizations opposed to synthetic biology in principle are sure to seize the opportunity to portray the start-ups’ discord as evidence that self-regulation is not a viable option. Late last month, as if to warn the squabbling parties about the threat of government intervention if they don’t straighten up, the U.S. federal government reminded the world that it has its own BESS guidelines.
Clients interested in the synthetic biology space should expect this spat to be just the beginning of a tumultuous period, and can look forward to things getting worse before they get better for at least the next twelve months.
Tags: Biosearch Technologies, DNA2.0, Febit, Geneart, Ginkgo BioWorks, Sutro Biopharma
Posted in Biosciences |
Friday, December 11th, 2009
We recently met with Takao Inoue of the newly formed Innovation Network Corporation of Japan (INCJ) in Tokyo. Formed through the support of Japan’s government, INCJ aims to encourage development of emerging technologies, as well as the adoption of an “open innovation” model among Japanese corporations. The vision is to enable industrial giants from Sony to Toyota to develop new products more rapidly by accessing inventions from universities, start-ups or other large corporations. Inoue explained that INCJ has been given 90 billion yen ($1.0 billion) to invest, with commitments for up to 900 billion yen ($10.2 billion) over the next 15 years. The Japanese government committed to providing 90% of the funds, with the balance coming from private firms, such as domestic leaders like Panasonic and Tokyo Electric Power, and overseas player like General Electric. INCJ plans to pursue investments in “environment and energy, life sciences, electronics, machinery and components and advanced materials,” with additional areas possible in the future.
As part of its role, INCJ will serve as an early-stage venture capital (VC) or angel investor. It will provide funds to secure promising intellectual property from universities and government labs, and back start-ups and spin-outs – filling a gap in which traditional Japanese VCs have been unwilling to invest more than small sums. However, Inoue-san noted, INCJ’s mission isn’t limited to early-stage investments. It will also provide larger investments to fill capacity expansions and project finance needs – a role that’s missing in the West as much as Japan. Such projects require larger sums than VCs are willing to offer, or impose too much technological risk to entice traditional private equity investors.
It’s still early days for INCJ. The firm was established in June, and won’t make its first investments until early 2010. But clients should watch to see if it can maintain its political and private support, and succeed in bridging gaps in Japan’s existing financing model, which make the country poorly suited to fund emerging technologies in energy, environment and materials.
Posted in Alternative Power, Biosciences, Nanomaterials, Solar, Water |
Wednesday, December 9th, 2009
 Bioplastics may be renewable, biodegradable and sometimes both. But despite their eco-appeal, they currently represent only 1% of global plastics revenues. Yet as dozens of start-ups are entering the market along with large chemical companies such as Dow Chemical, Bayer, and BASF and even agricultural players like Cargill, we expect today’s $1 billion biopolymer market to see double-digit growth in the coming years.
Even so, before they see widespread adoption, biopolymers must be both as effective and economical as conventional plastics.
In our recent report, “Growing Tomorrow’s Green Materials,” (client registration required) we assessed emerging green materials, and scored them on three dimensions: their performance characteristics, economic competitiveness and ecological profile. Taken from that report, this week’s graphic shows biopolymers under-perform their conventional counterparts on every dimension except the ecological.
Granted, performance and cost may be secondary considerations in some applications, such as toothbrush handles, packaging and printer cartridges where traditionally used plastics materials are arguably over-engineered for the job. But in order to compete on a scale with conventional materials, biopolymers will first need to deliver comparatively higher – or at least unique performance attributes and lower costs than their conventional counterparts.
Posted in Biosciences |
Friday, November 27th, 2009
We recently attended the Biotechnology Industry Organization’s (BIO) Pacific Rim Summit in Honolulu, Hawaii. As the name and venue indicate, the event is meant to bring together developers of biofuels and biomaterials from regions as dispersed as Asia, North America, and Australia. One plenary session illustrated the differences facing development of biofuels and biomaterials, even within these regions: Nobuyuki Kawashima, Executive Director of the Chemical Society of Japan, reported that Japan is planning to expand use of biofuels from 30,000 liters in 2007 to 50 million liters in 2011 and 6 billion liters in 2030 – which would account for just 10% of the country’s fuel use. Japan’s modest ambition, however, stood in stark contrast to two other speakers.
Dehua Liu of China’s Tsinghua University reported an aggressive adoption of new biotechnologies. For example, 70% of cotton grown in China is transgenic. He said that because of its rapid growth, China’s energy use compared to GDP is six times the OECD average, and essentially all growth demands imported energy. For that reason, China is aggressively pursuing biofuels from every feasible feedstock, including food crops, cellulosic material and algae.
Bhima Vijayendran of Battelle explained that Malaysia has about 15 years of oil and 25 years of natural gas left, but “with abundant rain and sun, we have a lot of biomass: 4.1 billion hectares of palm plantation, and 16 million tons per year in total biomass from forest.” Given the country’s looming oil crisis, its government, academia, and industry are focusing on biotechnology. The country’s national oil company Petronas is partnering with Battelle on renewables to design a palm biorefinery. Malaysian scientists recently sequenced the palm genome in preparation for engineering it, and the government has set a goal for the biotechnology sector to account for 5% of the country’s economy by 2020, up from 2.5% today.
As these examples show, it’s not only a country’s natural resources or available technology that determine its biofuel strategy. Demographics, energy policy and the government’s stance on genetic modification all play roles that are just as important. As enamored as technology developers are with their chemistry, biology and engineering feats, social factors often pose greater obstacles and opportunities than technical ones.
Posted in Biosciences |
Wednesday, October 28th, 2009
We recently spoke at the Sweden and California Sustainable Innovation Conference in San Francisco, California. Despite differences in industry and population, the governments of Sweden and California share similar sentiments and regulations on energy and the environment. They also share ambitions to lead in environmental issues, and even formal agreements on specific goals and metrics.
One example of their overlapping interest is environmental management of urban regions. Generally, 50% of the populations in industrialized countries live in cities, which pose specific environmental challenges for city-based administrators - as opposed to their national counterparts.
Among the speakers was Caroline Dahl from the County Administrative Board of Skåne - the Swedish side of the Öresund strait, an urban region encompassing Copenhagen and home to 3.7 million inhabitants. She told the audience, “In the 1970s, you could not dip a toe in the water flowing around Stockholm, an island city. Today, you can fish and swim and drink it - a situation almost unique among capital cities around the world. Sweden has reduced sulfur emissions to levels not seen since World War I.”
She also discussed how the country’s Symbiocity program links urban systems so that waste from one system becomes fuel for another. To illustrate, she described the municipal plants converting landfill and agricultural waste into biofuel, which is done “a lot” in Skåne. In addition, the bus fleet in the region’s largest city, Malmö, runs on biogas made from agricultural and municipal waste.
From the California side, we heard about Sustainable Oakland. While Oakland is notorious for gang violence rivaling that of Chicago and Los Angeles, it’s also earning a reputation as an increasingly green city for fielding initiatives from water meters to building codes. Garrett Fitzgerald, the city’s Sustainability Coordinator, talked about some of the palpable reasons that San Francisco’s sister city is so concerned about climate change: “We’ve seen sea levels rise seven inches over the last 150 years, and we expect maybe three feet over the next 100 - that means we would lose both airports in the region (both SFO and OAK are built on reclaimed land at the waterfront). We’ve seen snowpack reducing, which means less water - as much as 20% to 40% reduction.”
He said that 58% of Oakland’s greenhouse gas (GHG) emissions come from transportation, so the group’s top priorities are transit-oriented. The city is pursuing a goal of 0% waste by 2020, and pointed out that San Francisco is tops in the U.S. on this metric. Toward that goal, he said, “We’re looking at a lot of waste-to-energy technologies, but we are not convinced they are the way to go. Specifically, by assigning a commodity value to waste we might inadvertently cause people to stop reducing their consumption by giving them the false impression that waste has value and ‘isn’t that bad.’”
As progressive urban regions bisected by water, the Öresund region and the San Francisco Bay area are natural partners. Each provides a fertile test ground for companies interested in developing sustainable technologies, based on similar characteristics. Namely, millions of consumers willing to experiment with environmental products and programs, economically diverse industries and markets, and politicians eager to try new solutions. With increasing coordination, these groups offer scale and comparability and a combination that’s more than the sum of its parts.
Posted in Biosciences, Water |
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