Cannabinoid biosynthesis companies act as intermediaries between cannabinoids and CPGs. They help CPGs reduce costs and increase their profits by collaborating with other companies. So what do these companies do? This article aims to shed some light on this complex industry. Read on to discover how they are making a difference in the cannabis industry.
Cannabinoid biosynthesis companies act as intermediaries
Cannabinoid biosynthesis companies have many advantages, including a year-round growing season, a wide variety of crops, and the ability to produce a wide range of cannabinoids. In some cases, such companies have 24 to 100 harvests per year. Depending on the strain of bacteria or yeast used, a biosynthesis facility can produce up to 1,000 metric tons of cannabinoids per year. In addition, biosynthesis facilities avoid pesticides, heavy metals, and other environmental factors that can affect the quality of cannabinoids and cannabis.
The potential market for cannabinoid biosynthesis is enormous. According to Raymond James, it will reach $10 billion by 2025 and $125 billion by 2040. According to Edison, the market for cannabinoid biosynthesis will be worth $30 billion in NPV. Therefore, the companies that can bring high-quality products to market at lower production costs will have the most significant opportunity for profit.
As cannabis continues to gain legalization and its reputation, biotechnological and chemical synthesis are now available. Biotechnology companies have begun to develop the methods necessary to produce cannabinoids. These processes are faster and cheaper than growing marijuana conventionally, and the industry is now recovering from the turbulent period. Cannabinoid biosynthesis companies are looking at new challenges and opportunities, and major players from outside the space are making inroads.
They reduce costs
To cut costs, cannabinoid synthesis companies are increasingly using in vitro cell-free systems. For example, a heavily engineered system, which requires prenylation of OA feedstock and the addition of soluble StNphB, yields 1.25 g/L CBGA after 100 hours. A simplified system, however, produces only 480 mg/L CBGA, requires less feedstock, and takes less time.
In addition to cannabinoids, other chemicals produced by cannabis are insulin, blood clotting factors, and morphine. In addition to marijuana, Keasling is a synthetic biology pioneer and has sought to exploit bacteria and yeast as “green” drug factories. Cannabis cultivation consumes vast energy and pollutes streams and rivers with pesticide runoff. It also causes severe erosion and clear-cutting of natural habitats.
The market for cannabinoids is expected to double in size in the next five to 10 years, even though traditional plant-based production methods can’t meet demand. This potential has spurred investment in the biosynthesis sector. Companies such as Cronos Group, which has just signed a $122 million tie-up with Gingko Bioworks, focus on developing synthetic cannabinoids. Surterra Wellness and Intrexon also recently announced a $100 million licensing deal to produce cannabinoids with the company’s proprietary yeast fermentation platform.
They work with CPG players
Biosynthesis is a growing area of science that allows for the production of bioidentical molecules in cannabis. The biosynthesis process involves the introduction of genes from the cannabis plant into a yeast strain, similar to how alcohol is produced. The fermentation process creates large vats, which can be siphoned off as needed. Scientists have used biosynthesis for centuries, one of the fundamental skills taught in Life Sciences programs.
In the cannabinoid market, Amyris, a cannabinoid synthesis company, signed an RCL with LAVAAN in January 2019. However, in April 2020, LAVAAN filed a lawsuit against Amyris for 881 million USD, claiming that the former is using proprietary technology and that the agreement allows it to conduct commercialization efforts in markets excluded by the latter.