SynShark Producing Valuable Shark Oil in Tobacco Plants
By Barry Teater, NCBiotech Writer
|SynShark and NCBiotech executives check the company's one-acre tobacco plot near Greensboro, to be expanded to 10 acres with the help of a $250,000 NCBiotech loan. -- SynShark photo|
Every year an estimated 3 to 5 million sharks are slaughtered for a precious omega-2 oil in their livers called squalene, a clear liquid, lighter than water, that helps them float.
Squalene is in such high demand as a specialty chemical in the pharmaceutical, vaccine and cosmetics industries that as many as 30 million sharks will have to be harvested from the world’s oceans annually by 2019 to satisfy the growing market.
“This is an impossibility,” says Jason Ornstein. “An environmental tragedy.”
Ornstein, a London-based American entrepreneur who commercializes clean technologies, is executive director of SynShark, a company founded in 2013 to develop an environmentally sustainable, land-based source of squalene that could ease or eliminate the catch pressure on sharks.
The three-employee company, with operations in Texas and North Carolina, wants to harvest squalene from the leaves of tobacco plants that have been genetically engineered to synthesize the oil.
“This can be a healthy solution for this market,” Ornstein says. “The tobacco plant is actually an excellent platform for this.”
Tobacco has been well studied for decades and has large cells that are relatively easy to engineer. It has been used to produce a variety of therapeutic proteins, including antibodies for a drug that saved the lives of two American aid workers infected by the Ebola virus in 2014.
Valuable oil harvested from initial test plot harvest
SynShark has produced squalene in laboratory-grown tobacco and this summer successfully harvested the oil from a one-acre test plot on a tobacco farm near Greensboro, N.C.
The company has achieved a 7 percent dry-weight yield in the lab, where conditions can be carefully controlled, and 3 percent in the field. The goal is to boost crop yields to between 3 and 5 percent for commercial viability, Ornstein says.
Squalene sells for about $30 per liter to wholesale brokers, who then sell it for about $52 per liter to consumer companies. The compound is used by cosmetics companies as a moisturizer and by pharmaceutical companies as a vaccine adjuvant.
“Vaccines are the biggest market driver right now,” Ornstein says.
The squalene market, valued at $93 million, is growing annually by 25 percent and will reach $300 million in a few years, Ornstein says. That growth not only provides an opportunity for SynShark but for tobacco growers in North Carolina.
Turning over a new leaf: $3,300 an acre becomes $14,000
Traditional tobacco farming brings about $3,300 per acre in gross revenue for growers, while producing squalene under contract could gross up to $14,000 per acre, Ornstein says.
“By focusing on a specialty product like squalene instead of a commodity, SynShark can deliver improved margins in agricultural biotech,” he says.
SynShark could require 1,000 acres
Ornstein projects that SynShark could eventually need as many as 1,000 acres of tobacco under contract for squalene production in North Carolina. The timeline for the company's commercial production of squalene is two to three years.
A recent $250,000 Small Business Research Loan from the North Carolina Biotechnology Center will be “absolutely critical in accelerating our move from lab to market,” Ornstein says. “Farming is a seasonal activity, so the more aggressively you can scale up, the more quickly you can optimize the process. The Biotech Center's funding is focused on this and last-mile activity of extraction.”
SynShark is seeking to raise $500,000 in venture capital by early 2016 and would also like to engage with a commercial partner for squalene, ideally an end-user pharmaceutical company, Ornstein says.
The biosynthesis technology for squalene and related terpene compounds was developed in the lab of Joshua Yuan, an associate professor of systems biology and bioenergy at Texas A&M University in College Station. The research was part of a biofuels project funded by a $5 million federal grant from the Advanced Research Projects Agency, Energy (ARPA-E).
Though SynShark is headquartered in College Station, it has an office in Cornelius, N.C., north of Charlotte, and expects to expand in North Carolina when commercial production of squalene scales up.
“We were born in Texas, but it’s an oil and gas state,” Ornstein says. “The biotech infrastructure here (in North Carolina) is amazing, but also the history of tobacco is important. That’s why we’ve made this about North Carolina.”
In May SynShark outshone nine companies from six states to win a $10,000 prize for best presentation in the Ag Biotech Entrepreneurial Showcase sponsored by NCBiotech. The annual event exposes young companies to investors and technology scouts and provides information sharing, networking and partnering opportunities.