By Tony Fong
NEW YORK (GenomeWeb News) – With two recent deals, Life Technologies is positioning itself to capitalize on what could be the next big market opportunity in the life sciences.
During the past two weeks the Carlsbad, Calif.-based company has completed two deals giving it a seat at the synthetic biology table — a field with a market size that has been projected to reach $2.4 billion by 2013.
In late May, Life Tech acquired a 74 percent stake in German synthetic gene company Geneart for €38 million ($46 million). Then last week, it said it had made an equity investment for an undisclosed amount into Synthetic Genomics, the company behind work by Craig Venter and colleagues that resulted in the creation of the first functional bacterial cells controlled by a synthetic genome.
While synthetic biology remains a bleeding edge field whose commercial use is still largely unexplored, "we see synthetic biology as a great long-term opportunity to really impact the world with solutions based on biology," Peter Dansky, president of Molecular Biology Systems at Life Technologies, told GenomeWeb Daily News last week, adding that the firm's approach is to develop toolsets and tool kits for the research, in line with the company's general business model.
"We're focusing initially on the research field and developing out the tools that will be required," he said. The Geneart and Synthetic Genomics deals "fit the full breadth of that spectrum."
He did not say whether Life Tech is actively pursuing other deals with synthetic biology implications but noted that it may license technologies "that will fit well in the mix."
Of the two recent deals, Geneart is expected to have the most immediate impact. The company designs synthetic information that is then incorporated into genes, a capability that Dansky described as a "one of the foundational tools and building blocks" of synthetic biology.
Life Tech, he said, has cloning systems and vectors such as the SuperScript product line and Lipofectamine transfection reagents, and Geneart's expertise will be used to continue building research tools such as software, instruments, and services "to allow biologists to be synthetic biologists."
"We envision developing the next generation of those tools — the vectors and the chemicals and processes — that are used to get these genes into the samples and into larger organisms and ultimately having the sorts of organisms that would be directed toward an application," Dansky said.
The deal with Synthetic Genomics is more of a long-term transaction and is "not a short-term investment," Dansky said. Life Tech's involvement with Synthetic Genomics is on the applications front, particularly in biofuels.
"Our interest there is to be part of that future, to be engaged with opinion leaders with the industries that will ultimately benefit with this technology and to understand where that is going and what their needs are," so that Life Tech can develop the necessary tools and instruments, Dansky said.
The deal with Synthetic Genomics, based in La Jolla, Calif., was not made with the idea that it would result in "a quick win" or to provide Life Tech with "particular access to a product," he added.
One of Synthetic Genomics' main projects is a collaborative effort with Exxon Mobil Research and Engineering Group to develop biofuels using photosynthetic algae. In a statement announcing the deal last July, Synthetic Genomics said it has been at work for several years to develop more efficient "means to harvest the oils that photosynthetic algae produce."
Algae have been treated like a crop and growing and harvesting it has been expensive and time-consuming, the company said. "One of Synthetic Genomics' achievements has been in engineering algal strains that produce lipids in a continuous process that is currently more efficient and cost-effective."
While Venter's announcement last month that he and his team had created functional, self-replicating cells that closely resemble M. mycoides cells pushed synthetic biology into the mainstream media, Dansky said that Life Tech's interest in the field is not an infatuation but rather a long, slow simmer.
Four years ago, Invitrogen, which merged with Applied Biosystems in late 2008 to create Life Technologies, made an investment in gene synthesis firm Blue Heron. At the time, Invitrogen said that the Bothell-Wash.-based company's ability to "synthesize any sequence" made it "ideal for the synthetic biology market."
Dansky called Life Tech's work in the field "synthetic biology 1.0" and added that the field is now at a crossroads. While most of synthetic biology has been carried out in research labs, and as a business proposition it remains unclear how the technology can be commercialized, at least one market research firm projects the synthetic biology market to grow exponentially.
According to BCC Research, the global market reached $233.8 million in 2008. By 2013, the market is expected to grow more than 10-fold to $2.4 billion, a compound annual growth rate of 59.8 percent.
The chemicals and energy segment makes up the largest portion of the market, worth almost $81 million in 2008, and is forecast to expand at a compound annual growth rate of nearly 82 percent to reach $1.6 billion in 2013, BCC Research said. The pharma/biotech segment, which generated about $80 million in 2008, is expected to see a compound annual growth rate of 49 percent, translating to a market size of $594 million in 2013, it said.
Aside from Life Tech, other life science firms are showing interest in synthetic biology applications and inking deals to exploit the technology. Two weeks ago, Thermo Fisher Scientific said it would be providing synthetic peptides to the Institute for Systems Biology's Human Proteome MRMAtlas. Earlier in May, synthetic genomics shop DNA2.0 and contract research organization Blue Sky Biotech announced a strategic alliance using DNA2.0's gene synthesis and protein expression and purification services.
And last September, ITI Life Sciences in Scotland said it had invested £2.5 million to fund a genome segment assembly project by Heriot-Watt University in Edinburgh and synthetic biology firm Ginkgo BioWorks.
Though Life Tech has existing product lines for synthetic biology-based research, some tools and especially instruments may need to be developed almost from scratch.
Pointing to the gene synthesis process, Dansky said that Life Tech is able to synthesize oligonucleotides, and then perform DNA sequencing and PCR-based analysis, so "there's a lot that we can leverage" that's already in Life Tech's product portfolio.
Computers are used to design the gene or genome, and Life Tech has software for cloning and sequence analysis. "And we will build on that platform to create the synthetic biology workbench," he said. "It's true across the whole spectrum — whether it's in cloning or whether it's in expression vectors, we have a foundation to work from, [but] it needs to be optimized, sometimes in fairly innovative ways."
Most of the technology development at Life Tech directed at synthetic biological applications is on the reagent side currently rather than the instrument side, simply because the field is too new, he added. It's only now that benchtop systems for basic molecular biology are being automated, he said, and "we need to develop the processes first, and then down the road we can start to envision ways in which they get automated and integrated into instruments."