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The race is launched to manufacture the active ingredients of marijuana without the need of a farm.
For years, Amyris of Silicon Valley has been using an approach called synthetic biology to produce the ingredients for its face creams and a new zero calorie sugar substitute. Now, she is teaming up with a new startup called Lavvan to make the CBD cannabis-based compound using the same tools under a $ 255 million contract.
The main goal of this partnership – the company's most important collaborative agreement to date – is to produce a high quality CBD at a lower price than traditional agriculture, said the general manager of the company. Amyris, John Melo, at Business Insider. CBD is a very popular, but little studied, wellness ingredient found in marijuana and hemp plants.
Melo said that he saw a potentially simple opportunity for the compound: using Amyris' sweetener experience to create CBD-based drinks that actually have a good taste.
"There is an opportunity here for a flavor solution," said Melo.
The CBD is in everything, but some say that there is a problem
The CBD currently exists in a legal gray area. Nevertheless, this has not stopped dozens of companies from producing a range of products made with pride with this ingredient. What about coffee, beer drinks, patches and lotions, there is probably a CDB version somewhere. This month, pharmacy giants Walgreens and CVS have announced that they would even sell CBD-based products.
The expanding CBD market is valued at approximately $ 1 billion. Last month, badysts on Wall Street and investment bank Cowen said they could rise to $ 16 billion in the next six years.
Read more: Wall Street thinks the $ 1 billion market for the CBD could rise to $ 16 billion by 2025
But some media have reported a unique problem facing a segment of the CBD market: drinks made with the compound are not good, they say. Some people have called the flavors "barnyard" -like; others say that they taste like dish soap or even urine. Melo agrees.
"One thing has become obvious, it is that the CBD does not have good taste," he said.
But Melo thinks that Amyris and Lavvan have a potential solution: use the CBD that they produce in drinks based on their calorie-free sweetener.
The Amyris sweetener is made from synthetic biology and an ingredient derived from the stevia plant. Some players in the sugar industry seem to find this promising: Amyris last October signed its first major supply and distribution contract with ASR Group, the largest sugar refiner in the world. Two months later, protein shake company Shaklee announced that it would also manufacture its beverages with the alternative to Amyris sugar.
"We see here a great opportunity where our sweetener customers are also becoming our CBD customers," said Melo.
Making goods with living beings could be the future of manufacturing
The approach of synthetic biology of Amyris essentially consists of harnessing the power of cells to make everything from less toxic sweeteners to superior quality face creams. They bring microbes such as yeast and E. coli to make smells, emollifiers and the ingredients of their sugar substitute.
Recently, investors have poured millions of dollars into startups in the synthetic biology sector. They hope that a range of new environmentally friendly materials will emerge in the coming years. Until now, a whole range of startups aims to make everything from cheaper drugs to biodegradable bags to less toxic insect repellents.
Read more: After the kickoff of Bill Gates, a Silicon Valley company claims to be the "Intel Inside" market of sweeteners and skincare worth $ 200 billion
Laboratory-grown marijuana is the last ingredient on their radar.
Last month, scientists from the University of California presented the first compelling evidence that they could make lab-grown cannabis compounds, such as CBD and THC, using synthetic biology. Lead researcher Jay Keasling has created a new start-up to license technology called Demetrix. Six months ago, Boston-based start-up Ginkgo Bioworks signed a $ 122 million contract with marijuana maker Cronos to produce similar ingredients, including those found in very small quantities in the cannabis plant. , like the THCV.
And now, Amyris is diving too.
Little is known about Lavvan in public, but his new CEO, Etan Bendheim, took office after 10 years of service with Phibro Animal Health, a pharmaceutical company, where he was most recently director of the company. strategy.
The agreement between Amyris and Lavvan includes research and development work, milestone payments and long term royalties. It also includes manufacturing rights to 20 different compounds in the marijuana plant, Melo said. For now, they will aim to start producing CBD.
"Our goal is the highest purity CBD at the lowest cost," said Melo.
A potential barrier that Amyris may face is the demonstration that its scientific approach to sweeteners and skin care works with cannabis. Melo is optimistic, though. He hopes to have CBD's first commercial production early next year.
"We have a pretty good idea of what we produce today in the lab," he said.
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