Verdezyne acquires strategic investments from BP, DSM

By Kris Bevill | May 12, 2011

Verdezyne Inc., an industrial biotechnology company developing yeast platforms for first-generation ethanol production, cellulosic ethanol production and biobased chemical production, has received strategic investments from BP Alternative Energy Ventures and Dutch chemical firm DSM Venturing BV. Verdezyne is not releasing the specific amount of each investment, but CEO E. William Radany said the boost will help fund the company’s operations through 2012, including the establishment of a pilot plant to produce adipic acid.

Radany credits Stephen Picataggio, Verdezyne’s chief scientific officer, for putting together an enviable research team and making advancements that attracted such heavy-hitting investors as BP and DSM. “He has built a world-class yeast engineering team, employing computational modeling for metabolic pathways in yeast as well as computational design for protein engineering and gene design,” Radany said. “They were impressed with the team, the direction we’re going and the progress that has been made.”

Last April, Verdezyne, formerly known as Coda Genomics Inc., began working with Lallemand Ethanol Technology to develop a yeast platform to improve the efficiency of first-generation ethanol production. Verdezyne is engineering a proprietary pathway for Lallemand’s yeast strain, which Radany said is anticipated to increase ethanol yields by up to 6 percent at a commercial scale. “In laboratory strains we have demonstrated far in excess of that,” he said. “If you think of generating a 6 percent yield improvement from the same amount of feedstock, that drops a significant dollar figure to the bottom line for an asset owner.”

Radany said the enhanced yeast should be ready for commercial deployment by the fourth quarter of 2012 and will be distributed by Lallemand. Verdezyne will receive royalty payments and licensing fees for its participation in the project.

Verdezyne is also developing a proprietary yeast strain for cellulosic ethanol production. The company has recently demonstrated the engineering of a strain that would allow the high efficiency metabolism of C5 sugars and is developing other proprietary strains that can be used for the conversion of cellulosic materials to ethanol. Radany said the both the first-generation and cellulosic ethanol yeast strains are being developed in parallel with the company’s other main focus, which is the production of biobased adipic acid. Verdezyne is currently in the process of establishing a pilot plant in Carlsbad, Calif., to produce the chemical, which has applications as a resin in a wide variety of industries, and expects it to become operational by the end of this year.