Frontiers of gene-editing, and why Calyxt is one to watch

April 9, 2017 |

This past week, in highlighting 29 technologies to watch, we put a spotlight on Calyxt, and we’d like to return to that technology in more depth today — as we look at real disruptive change not only in technology but in consumer attitudes, and buying patterns.

Let’s explore that technology and company in more detail today, and look at what’s disruptive about it.

At its heart, it’s a company about transformation in basic food feedstocks. But where the technological imperative for years has been about, to use an example, more corn and cheaper corn — with the resulting focus on rate and yield — Calyxt is overtly focused on performance. On better food.

Specifically — products like reduced trans fat soybean oil. gluten-reduced wheat, lower saturated fat canola oil, improved quality potatoes. Dialed in at the gene level, through gene editing.

Now, the old food vs fuel paradigm doesn’t apply any more. There’sa temptation to turn the page and say something like — if it’s about petroleum or gas, that’s about energy. Woods, that’s energy. Corn, soybeans, that’s only about food. And never the twain shall meet.

But that’s old thinking, and old thinking can be dangerous thinking, just like old water can make you sick even though fresh water is an elixir of life.  We are making foods, flavorings, and animal nutrition out of petroleum and natural gas — and we are making fuels, materials and much more out of plant-based technology.

A few weeks ago, Calyxt attracted Manoj Sahoo to its ranks from a top position at Cargill where he was, among many other tasks, a board member at Rivertop Renewables and at Calysta — with a window to look at fast-emerging companies aimed at both the food sector and industrials. He was responsible for revenues over $1 billion in the fermentation space, leading the commercial enterprise team to triple its earnings from bio-based products, and managed relationships with large institutional customers.

The technology wave has been taking us in both directions of late — as we have seen not only at Calysta (which has food and Calysta Energy business units), but at companies such as Amyris and TerraVia. The focus on industrials or foods has really been about achieving the focus required to deliver on financial expectations given the resource constraint at smaller companies. The limitation has long ceased to be about technology. It’s not quite to the point of making anything out of anything — but if the cost restraint were not there, that statement would almost be literally true.

The drivers

The pressing issue that has driven Calyxt to serving the nutrition market are the pressing pain points in the food value chain. Not just the usual factoid that the world population will reach 9 billion by the year 2050 and we need a lot more food. Or the fact that China is eating more meat, which is more land-intensive than grain.

“75 percent increase in obesity. 65 percent increase in food allergies. 53 percent in diabetes,” Sahoo told The Digest. “These are telling on the food and industry. The world doesn’t need more food. it needs the right kind of food. the world doesn’t need more industrial products, it needs the right industrials.”

And let’s look beyond population counts to population composition. “I’m getting older, I don’t need as many calories,” said Sahoo. “But I need the right calories, I’m not going to buy the way I did when I was a student, I’m going to buy something more sustainable. Be it from food or personal care. The right product is important. The consumer doesn’t want more product at a lesser price, but the right product at the right price.”

That’s right, an aging population is going to care more about health outcomes. What about everyone else though?

“There are millennials,” observes Sahoo. “ They would rather eat something healthy, something they can connect to, rather than what is handed to them by big branded companies. They buy smaller, more local brands that they connect to more as millennials and that is where Calyxt is uniquely positioned. We can help companies across the value chain. This food is something you can connect with. because of the way it is grown and the science behind it.”

What about the Baby Boomers, then, and Gen X — not quite to the retirement home but not quite of that Millennial generation?

“It may not be the boomers at the beginning. Not every consumer cares about it, but they need to care about it, if you are in your 60s or late 50s and you are taking trans fat, that’s not right for your health. But if boomers are not going to change their habits, society is going to pay trillions in health care costs. Some of the population have an incentive to change, like aging people, because the costs of doing nothing are heavy. Look at it this way: among white males the average life expectancy is going down, not up, and my hypothesis is that some of it is because of the food.”

That’s right, Boomers are becoming Grey Boomers. So perhaps, after many years of focusing on taste, mouth experience, and price, Calyxt sees a new niche emerging for a bridge between farmers who want to grow something healthy and more sustainable for the new consumer.

Or as Sahoo notes. “The ag and food chain has been designed over a thousand years, and we are still growing crops we grew in the Middle Ages.” He places this into the realm of “fast revolution” and not just revolution. But we can do better than just the same old ideas we had in 1500 about how food performs for us and within us — and not just always be focused on making the same old stuff, only faster.

Is this the right time?

Sahoo thinks so.  “Now is the time because such tools are now in the marketplace. Gene editing has a lot of promise on how to make it happen. It’s about finding the right partners the right business models and understanding your consumers well.”

But what about the big global food and crop companies — all that consolidation. Bayer-Monsanto, Dow-DuPont, Syngenta-ChemChina. Won’t that slow down innovation, and investment, as focus goes away from R&D and onto M&A?

“Consumers are not going to wait for bigger companies to innovate. and there is a gap,” says Sahoo. “Most likely, Dow Dupont will be approved – it is already approved in the EU, and we will likely see the approval with ChemChina and Syngenta. When dinosaurs become bigger dinosaurs there is a bigger void to fill, because bigger dinosaurs find it harder to innovate.  Smaller companies can fill the void and provide solutions. There’s enough room for newer companies to participate in this new paradigm.  So, in this trend Calyxt is very uniquely positioned.

What about capital – will that be available when strategics are tied up and others are risk-adverse?

If you have a team that believes in itself and the technology and the consumer trends, there is enough appetite for good products and ideas, there is always money. I don’t think money is the constraint.

Transgenic vs non-transgenic

Sahoo told The Digest, “Gene editing is like hybrids on steroids. We are not using any gene outside the species. In our case, the technology creates products that are not transgenic. The USDA has now taken a stand.  As long as it is not transgenic, it is non-regulated. But we also believe in transparency, let it be in the open, so that the consumer can develop a point of view.”

Atom, Byte and Gene

Let’s go back to the basics for a second when we look at the rise of non-transgenic, gene editing based technology.

As Sahoo explained in a recent LinkedIn post:

The twentieth century saw the emergence of three profound ideas: the atom, the byte, the gene.  Even though they are unequal, each one represents the smallest unit or the building block: the atom, of matter; the byte of information; the gene, of biological information.

Atoms can be shaped to meet growing needs of different kinds of materials for a better life for human society globally, Sahoo told the Digest.  It ranges from atoms in energy to unique materials used for various applications starting from packaging to clothing to plastics to automobiles to personal care.

But attention has shifted to the gene and there’s no doubt about that. Making similar or unique materials in a sustainable way by using renewable feedstock.  And now, Sahoo observes, scientists can decipher how genes interact in time and space at a much faster rate and lower cost than predicted. 

Future steps

We suspect animal nutrition has to be on the docket, and not just more crops used in human nutrition. And Sahoo agrees. “We are already working on animal nutrition, although as a public company we can’t say much except that there is a pipeline. We are actively seeking the right partners. What is applicable to humans is applicable to animals. What is happening in the animal protein supply chain can be helped by this technology.”


In the end, for a small company, success will depend on the right kind of partnerships – particularly those that stretch towards the market.

“Most partnerships will be focused on downstream, on consumers,” said Sahoo. “The bulk of the focus is on the value chain. We would not hesitate to go all the way to the consumer if it was the right partner.”

Who might those partners be?

“We can’t name names,” Sahoo said. “but these are companies who would share our views on the importance of transparency, and who believe in the science, and believe that these consumer trends are here to stay. You see elsewhere sometimes the attitude that ”we know it all, we know better” but you won’t see that here. In fact, I was pleasantly surprised at the level of diligence in choosing crops and traits, and the openness of the scientific team in receiving feedback about markets and opportunities. That’s critical, because as s a small company we have to have focus and be careful with resources and capital.”

So, think that science for science’s sake will be conducted elsewhere.

What we will see this year and next?

“We’re looking to commercialize in 2018,” said Sahoo. “This year is about building up muscle, building up capacity.”

More about Calyxt

That’s right here.

Print Friendly, PDF & Email


Category: Top Stories

Thank you for visting the Digest.