A Conversation with Dr. Sunil Chandran

OPEN IN VIEWER

Sunil Chandran, PhD

Founded in 2003, synthetic biology firm Amyris (Emeryville, CA) had originally set out to develop yeast that would produce a precursor to artemisinin, a potent anti-malaria drug whose production volumes were limited by a long process time. After turning that technology over, royalty-free, for larger-scale development, Amyris shifted its attention to producing biofuels, but like most in the space, struggled to find traction in low-margin, high-volume commodities. Finally, in 2012, the company decided to pursue renewable specialty chemicals, where it has since found considerable success, reporting $124 million in sales through the third quarter of 2022.

Today, Amyris has multiple consumer-facing brands, and its ingredients can be found in over 3,000 clean health, beauty, wellness, and flavors and fragrances products used by more than 200 million consumers. Its Biossance brand comprises a wide range of sustainable skincare products employing biobased squalene and also boasts Reese Witherspoon as brand ambassador. The company's baby and mothers care line, Pipette, is sold at Nordstrom, Buy Buy Baby, Amazon.com, Walmart, and Target. Amyris also sells a fermentation-based Rebaudioside M (Reb M), a natural, zero-calorie sweetener as an ingredient to food and beverage companies and as the main ingredient of Purecane, its own brand of sweetener products sold online direct to consumers and on Amazon.

All told, the company's portfolio includes 11 launched or acquired brands, and that figure is sure to grow. The company's Lab-to-Market™ technology platform for synthetic biology and bio-manufacturing offers a scalable way to either deliver biobased ingredients to customers or add new names to the Amyris family of brands.

Industrial Biotechnology recently sat down with Sunil Chandran, PhD, Chief Science Officer and Head of R&D at Amyris, Inc. to discuss progress in biobased chemicals as well as hopes that President Biden's recent National Biotechnology and Biomanufacturing Initiative, which earmarks $2 billion to build a bioeconomy in the US, will accelerate development of the industry as a whole.

INDUSTRIAL BIOTECHNOLOGY: Amyris CEO John Melo recently participated in the White House Summit on Biotechnology and Biomanufacturing for the American Bioeconomy, which closely followed an executive order from President Biden supporting US biomanufacturing. Would you like to start by telling us a little bit about the executive order and where you see Amyris contributing to the country's bioeconomy development efforts?

DR. SUNIL CHANDRAN: The initiative is great for the sector. At Amyris, we've been working on biomanufacturing for over a decade. I've been part of Schmidt Futures' Bioeconomy Task Force, and we just put out a report earlier this year that essentially encapsulated what the White House announced—an emphasis on national, domestic sources of biomanufacturing to strengthen our own supply chains internally and as a way to combat climate change.

IB: Amyris CEO John Melo once said one of your first commercial products, farnesene, a renewable drop-in replacement for diesel, took four years and $200 million to engineer. What might it cost today, with current technology?

DR. CHANDRAN: Our first commercial product was artemisinin, which was funded by the Gates Foundation. The second was farnesene. But yes, it took us four years and over $100 million alone just to get enough material to start testing—so just to get to pilot-scale facility. And it took us about 10 years to achieve favorable economics, keeping in mind that biofuels command much lower prices compared to some of our other markets.

How has the technology changed? What we've developed at Amyris now allows us to get our hands on samples for formulation and testing in less than a year. That's a huge advantage, because it means that our partners can actually start testing quickly. In some cases, we have even been able to go to market—actually commercialize a product—in a year or less. That might not be the case for every single chemical we make, but we know it can be done and we've done it a couple of times. But on average, we tend to go from lab to market in two years.

IB: Do you feel as though regulatory agencies understand the technology enough to help and not hinder the bioeconomy as these new technologies begin to enter the market?

DR. CHANDRAN: Regulatory agencies play an important part in making sure consumers get a safe product. Having said that, there's no reason why we can't streamline and accelerate oversight. As to whether regulators' understanding of the technology has kept pace with the science, I would say there is some catching up to do. Biomanufacturing is common in the pharmaceuticals space, where you are trying to make a life-saving drug. There, the regulatory oversight is appropriate—they don't care what the microbe does or the feedstock is, as long as the final product is safe and efficacious for the patient.

Biomanufacturing has been used for commodity chemicals, but never at the scale we are approaching today. I think that's where the regulatory agencies need to streamline their process to be more in line with how consumers are going to use these chemicals.

IB: The White House summit included many leaders in the sector. Did anything from the event stand out to you?

DR. CHANDRAN: It was exciting to see the energy in the room, to be honest. I don't think the sector has ever received that kind of primetime validation, at the White House. I think the administration is starting to realize what the sector can do for this country and the planet.

The fact is, the US is a leader in this space. The question is, how do we remain a leader. It was an important summit to answer this question. Let's be honest—the biggest risk at this point is that we become complacent as a country and give up the advantages that we have already worked to achieve.

And I'm excited to see what we are able to achieve from this funding and the spotlight that has been put on the industry. I'm excited that Amyris was included in the event, because we have a lot to share based on our many years developing these products and we can bring a lot to the table. It's our responsibility to make sure that companies entering the space today don't have to wait ten years to make an impact. That would be a loss for all of us, and the environment.

IB: Any advice for new companies based on your experiences?

DR. CHANDRAN: Start with the end in mind. It's not just what happens in the lab that you need to worry about. On day one, have an idea on how you are going to scale up and make sure you understand those risks ahead of time.

IB: Is the $2 billion earmarked by the executive order sufficient to seed growth of a domestic bioeconomy of meaningful size?

DR. CHANDRAN: It's a great start. I think you have to start somewhere. At this point, any funding from the US government is welcome. And, at the end of the day, it is our responsibility to use the funds and show what we can do and the promise the technology possesses, because I believe we will be successful and that will lead to additional funding. I think the $2 billion is just a start, and it's a good start!

IB: How would you compare the funding environment in the US versus the rest of the world?

DR. CHANDRAN: Most of the investment in this sector in the US has been from industry and VCs. There has been funding from some government agencies like DARPA [Defense Advanced Research Projects Agency] and DOE [Department of Energy], but those have been focused on foundational technology, not necessarily investment in actual facilities.

Countries like China have been making huge investments, not only on the basic research side but also ramping up infrastructure and giving companies resources to build these kinds of facilities there. This is where the gap is in the US right now. That is not to say that the US doesn't have the infrastructure needed to do biomanufacturing, but that infrastructure was built with a very different demand in mind. So, you have massive GMP facilities for pharmaceutical production and commodity chemicals. The problem is that those facilities are either too big or over-engineered for the kinds of chemicals we need to produce today for consumers. We are producing a million tons of every single chemical. Sometimes, you need to produce 5 tons. That's where the investment doesn't match up. That's where the gap is.

What other countries, including China, have done is incentivize companies to restructure their facilities to meet this demand for consumer chemicals. In the US we haven't done that.

IB: It has been suggested that there is a lack of good ideas in industrial biotechnology right now, and all of the low-hanging fruit, targets with good markets and returns, has been picked. Would you agree?

DR. CHANDRAN: I don't think the good ideas have dried up, necessarily, but yes, the easy ones have been taken care of. What I mean by “easy ones” are the chemicals that are the high-volume, high-margin chemicals that easily fit in the current infrastructure that we have. The remaining chemicals are still important, consumers still use them on a day-to-day basis. The issue is that they don't command the kind of markets or high-volume we are used to with those low-hanging fruit targets.

An example would be some of the chemicals in the fragrance industry that are sold at 500 metric tons. Those have been addressed already through biomanufacturing. Now the question is how to develop something with a volume of 1 metric ton and still make money off of it, and does the infrastructure exist to help you make that chemical.

In a way, I agree with that statement, that the low-hanging fruit has been taken care of. But it doesn't mean we can't pursue the rest of it, the question is do we have the right infrastructure to support that development.

And I think on the science side, my team can use Amyris' technology to produce nearly any biological chemical out there, so the question becomes about its economics. What is the market need for it? That's the gap. So, I wouldn't say a lack of ideas, it's a question of matching markets with the facilities we have. Science can deliver, that's not the issue right now.

Our understanding of biology has increased and we now have access to some of the reactions that nature does on a day to day basis. Our understanding of the genetics behind some of these reactions has vastly improved and similarly, the tools we have in the lab to access that genetic machinery have also improved dramatically.

Synthetic biology, at the end of the day, is kind of just a sexier way of saying biotechnology, but the tools have changed dramatically. Our access to synthetic DNA allows us to actually transfer genetic machinery from an exotic host into something as common as Saccharomyces. You can sequence organisms that you couldn't sequence before, you can synthesize DNA that you couldn't synthesize before. You can analyze microbes in more detail than you ever could before. This is how synthetic biology has changed the landscape for the sector.

IB: Do you consider Amyris a consumer goods company at this point, having launched so many direct-to-consumer products?

DR. CHANDRAN: It's an interesting question, and one we get quite often. It's not so easy to categorize. Consider a company like Tesla—is it a car company, a technology company, or an energy company?

At Amyris, we apply science to offer solutions to companies and consumers so that they can get access to the same chemicals that they use on a daily basis without making any compromise on cost, performance, or sustainability. We are a biomanufacturing company. We apply science and process to manufacturing chemicals.

We've always worked with sector leaders that saw a gap in their supply chains for some chemicals. And one of the ways to solve these supply chain issues was using biomanufacturing. They also have ESG goals, and using technologies like ours allows them to meet those goals without compromising on their business.

When we work with partners, we allow them to access markets, but there are other markets that we know we can access ourselves. That's where the consumer brands we have launched or acquired come in—they allow us to work in markets where our partners don't but the same chemicals can be used.

The margins are different when we sell to the market directly than when we sell to a partner. Yes, in the latter, we share in the value chain and we get some profits, but you are going to give up margin because your partner is going to bear the lion's share. When we sell through our own consumer brand, we command a much higher margin for the same product. It also allows us to have a direct connection to the consumer, and we end up getting more data into the kinds of products consumers are going after and how we can predict market changes. Having our own consumer brands gives us those insights.

But both sides—business to business and direct to consumer—are very important to what we do and inform each other.

IB: The last time there was a surge of interest in this sector, back in the late aughts, there were some missteps: companies overpromising, underdelivering, or underestimating challenges and timelines. Do you worry this could happen again?

DR. CHANDRAN: At the end of the day, you have to take a risk in this sector to succeed. I think the missteps you refer to are missteps inherent to commercializing something new. Being successful in the lab is a requirement, but it is important to translate those lab-scale results into actual commercialization, and Amyris has gone through that. We've had our lessons learned. Today, every new manufacturing campaign is better than the one before.

The sector has been taking notice of that, and I think everyone in industry now appreciates the level of effort needed to reach commercialization. They are planning for it. There's a lot of thinking ahead to what's needed. I would say that has definitely gotten better.

Sunil Chandran, PhD: And I think we are also more realistic about what the sector can achieve, and where we still have work to do. This is where the Schmidt Futures report was very valuable. It allowed us to really define the challenges that exist in this sector and what is needed to be successful. We learned our lessons and we are communicating so that when a start-up enters the space, they know there is a blueprint waiting for them to understand what pitfalls they need to look out for.

IB: Looking broadly at the sector, are there any up-and-coming technologies you are particularly excited about?

DR. CHANDRAN: We just launched Stripes, a brand focused on women's health, specifically menopause, that uses a molecule produced through fermentation. I'm excited about it because it is not a space where biomanufacturing has traditionally been focused on and it's an area that deserves attention. We are also starting to look more at the microbiome and how the microbiome interacts with a person's health. Some of the chemicals that can be produced with fermentation can positively impact the microbiome.

Agriculture is another interesting opportunity. How do you continue to grow crops sustainably to feed a growing planet? Are there natural herbicides and pesticides that can be produced through biomanufacturing? These are chemicals that are produced by nature for some reason, and they are effective. And we are looking at how to produce them sustainably at a cost that is economical.

These are areas we are starting to gain more understanding and seeing that biomanufacturing can offer solutions.

IB: As CSO, how do you manage complexity across so many labs and pipeline products?

DR. CHANDRAN: The technical platform is agnostic to the end market for the chemicals we are producing. Our goal is to produce any chemical that we need to. Because of our experience in manufacturing so many chemicals, we do know what it is going to take to successfully launch a molecule. So, before we do the first production run, we already know what the process will look like, we know what the cost needs to be, we know what the volume needs to be, and most importantly, we know what kind of purity specifications are required. That allows us to plan ahead and start grouping projects for efficiency.

We developed our technology platform so that we have optimized the different microbes for different chemicals. So, when a new chemical target comes in, we can put it into one of our existing platforms and then it is a very quick manipulation. So, we are not starting from scratch every time.

Because we have platforms built for different chemical classes and different biological pathways, we can plug and play.