The future of precision fermentation in alternative proteins

Join us for an excerpt from a conversation with a precision fermentation expert as we explore the future of this field within alternative proteins.

We'll delve into recent developments, corporate investments, potential for cost reduction and comparison with other alternative protein segments.

Can you discuss what is happening in the precision fermentation space?

The precision fermentation space keeps growing with more startups entering the market, new funding and product launches, signaling a continued interest in this alt protein segment. For example, the most prominent precision fermentation startups such as Perfect Day and Change Foods have launched the Precision Fermentation Alliance to advocate for the adoption of the precision fermentation technology. Moreover, global giants such as Nestlé and Unilever have launched dedicated business divisions focused on alternative protein production through precision fermentation.

Product launches are also appearing in an ever-wider range of categories: The EVERY Company launched macarons featuring their precision fermentation egg whites, Brave Robot and Coolhaus introduced a precision fermentation ice cream sandwich and Very Dairy put the first precision fermentation milk on the supermarket shelves in Asia. In the U.S., Bored Cow launched a variety of flavored milks from a precision fermentation ingredient, targeting both kids and adults and boasting enhanced nutritional and functionality features compared to conventional dairy milk.

How are large corporates responding to the advancements in precision fermentation?

Most larger corporates are risk-averse and want to see high-value precision fermentation offerings that fit within their existing product portfolio and technology set-up. A noticeable trend is that large companies are slow at setting up projects in-house and enter the precision fermentation market via investment and / or partnership with a start-up. These partnerships can be either food and beverage companies using a precision fermentation ingredient in their product e.g. Perfect Day milk protein in Nestle’s Cowabunga milk or helping start-ups scale up their production as was the case with ADM and Perfect Day.

An exception to this would be mostly dairy companies developing ingredients in-house, for example DSM and Friesland Campina have both developed Human Milk Oligosaccharides (HMOs), an important component of human breast milk.

It seems that dairy is the most popular segment within precision fermentation?

Yes, dairy-associated proteins and sugars are the most well-represented segment within precision fermentation, with fats coming in second, followed by eggs and oils. One contributing factor to the diversity of product launches in the milk ingredient precision fermentation space is the versatile nature of dairy. Unlike meat and eggs, which are commonly sold as whole items, functional dairy proteins and sugars often find their way into a broad range of applications as an ingredient.

Additionally, precision fermentation ingredients have the inherent advantage of being lactose-free, making them an appealing alternative for lactose-free products.

What opportunities do you see to reduce cost and thereby increase adoption?

Most products derived from precision fermentation are unlikely to achieve cost competitiveness with their animal-based counterparts in the next 2-3 years. This is largely because current microbial strains are less efficient—exhibiting lower titers and yields—in producing novel ingredients via precision fermentation. The strains are essentially "brute-forced" to generate specific compounds that are not part of their natural metabolic pathways. As a result, continued advancements in strain engineering stand as a crucial prerequisite for driving down production costs.

However, there are also several non-strain engineering levers available. For example, one lever is to utilize cheaper feedstocks as the cost of fermentation processes is often dominated by raw materials, accounting for 40-50% of overall expenses. These costs are distributed upstream, for components like glucose and other nutrients or pH buffers, and downstream, particularly for consumables like filters.

Given the considerable financial investment in each batch, maintaining high sterility to minimize the risk of batch contamination is crucial. Failure rates can be quite low in well-optimized, controlled environments, potentially under 5%. However, failure rates could be significantly higher in less controlled or more experimental setups, with the higher failure rate being accepted as a cost of innovation. Alongside this, optimizing downstream recovery levels is vital. Although high-efficiency industrial fermentation systems often target yields of 90%, this can vary substantially, especially when using new host microorganisms and when attempting to create less conventional proteins or enzymes.

Not to be forgotten are that the consumers – us –are the ultimate end-users of precision fermentation products, making education on their safety and sustainability crucial. This boosts consumer acceptance and can influence regulatory policies, potentially increasing public funding and awareness.

How does the cost of precision fermentation compare to cultivated meat and plant-based?

At about 10-100 $/kg precision fermentation products sit somewhere in-between plant-based at 1-10 $/kg and cultivated meat at 100-1000 $/kg. However, the advantage here is that with precision fermentation you can first focus on high-value ingredients, instead of making the final B2C product. For example, Impossible’s hemoglobin is used as a low-volume ingredient in a plant-based product, which does not increase the cost too much, while still improving the overall flavor of the product.

As the industry progresses, we are going to see more and more commodity type ingredients that are used on a large scale such as whey and casein in various dairy products.

Any other thoughts?

The precision fermentation arena is becoming increasingly competitive, especially due to advancements in AI and computational biology to create new and known ingredients from many types of host organisms. New entrants must prioritize comprehensive techno-economic analyses and diversified product strategies, along with establishing robust "Plan A, B, and C" scenarios for their product lines, to ensure both strategic flexibility and a competitive edge.

Additionally, unlike traditional farming, which is constrained by seasonal cycles, precision fermentation operates year-round in controlled environments, allowing for quick scale adjustments in response to market demand. This rapid production cycle also accelerates the introduction of new products with unique properties.

About Maya Benami, PhD

Maya is a biotechnology consultant, researcher, and writer with over 15 years of experience. She specializes in technical due diligence, R&D troubleshooting, product formulation, cellular agriculture, fermentation, molecular farming, plant-based and novel ingredients for alternative proteins.

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