How to spend $2b on Biomanufacturing
Biden Bucks for Bio
In light of the recent biomanufacturing executive order and summit at the White House, I got to thinking about how best to deploy $2b into the bioeconomy.
There is no doubt that the government has a role to play in ensuring the US remains a leader in biotech. Many aspects of this industry are not adequately funded today by academia, venture / private equity, or non-profits. In particular, large scale “pre-competitive” infrastructure would be a fit for government support. This is part of the reason that the EU has been a leader in large scale biomanufacturing for decades.
That said, we must be cautious about propping up unsustainable businesses, creating perverse incentives, or forcing startups into arcane reporting structures, especially as we think about the mechanisms of investment.
As follows are some ideas about where to allocate capital, and how to do so.
$1b: Build six to eight biomanufacturing hubs with 100kL+ capacity each. Regional facilities covering most of the US. e.g. West, Texas, Corn belt, South, Midwest, & Northeast. These hubs are sorely needed to increase access to scale-up capacity, and can leverage local talent and biomass/feedstock. They may operate as CMOs with allocation to companies as well as academics. Low interest rate loans or off-take commitments could incentivize facilities to cater to high impact, early-stage ventures.
$250m: Develop 50+ open-access biolabs (plus 10 year operating budgets) for education, startup development, & incubation. Non-academic. This is probably one of the highest value investments the government could make - effectively the equivalent of a public library system for bio labs. Could partner with the NSF.
$250m: Fund bioeconomy worker training through community colleges, trade schools, and universities, including retraining for disrupted industries. There is a huge shortage of trained specialists in biomanufacturing, and most jobs do not require a PhD or even a Bachelors degree. We need new certifications and career paths for workers to break into this industry.
$150m: Open-source projects, especially those that create widely available tools to enable synbio innovation.
$150m: Government procurement commitments to buy bioproducts to feed into their supply chain, such as reagents, green chemicals, and biomaterials for DoD, NIH, and beyond. Commitment to material off-take from biomanufacturers would allow them to more easily raise project finance for production plants.
$100m: Fund product standards and facilitate regulatory pathways. Specifically we need streamlined regulation and approvals for new products in food, agriculture, cosmetics, chemicals, and consumer. Each synbio startup seems to be reinventing the wheel as they navigate a maze of regulatory agencies - there should be a single source of truth for new bioproducts coming to market.
$100m: Research into feedstock and new raw inputs that will support the bioeconomy. We are too heavily reliant on corn - we must expand into other carbon sources.
These are all good ideas and arguably the government is well suited to fund them. But what is the right “format” for the funding? We should focus on enabling dollars, where the ROI is great, in areas of national strategic importance. We must avoid burdensome requirements put on innovators, while remaining clear-eyed about smart use of taxpayer dollars.
Here are funding mechanisms that I propose, many of which could cut across the application areas listed above:
Loan programs office for biomanufacturing infrastructure projects.
Direct venture investment, non-recourse loans, or venture debt for early stage synbio companies, of strategic national importance (creating an independent supply chain, climate change resiliency, and beyond).
Rapid grants for fundamental R&D, especially open-source strain engineering toolkits and downstream processing innovation.
Direct funding of new pilot scale facilities at academic sites + training programs for Associates/BS/MS/PhD students.
Incentive programs or tax breaks to drive farmers to implement fermentation - either through usage of their crops as feedstock, or allocation of land to fermentation facilities.
The bioeconomy is of clear strategic importance to the United States and the federal government is coming to that realization as well. If we want to continue to lead, we must push for bipartisan, sensible investment in the areas that matter most.
Thanks to Karl Schmieder and folks on Twitter for helping me think through this piece.
Check out $ORGN, they are close to being operational at their first factory. They are going to be a hugely important company in the decade ahead
Hey @arye. Great article! This is not a pitch, but SCINET is working on fundraising platform for early-stage life sciences research. Would you be interested in chatting more about it? I've talked to Clarice a few times about it as well.