Synceres Biotech Files for Hong Kong IPO: Building a Market-Driven Synthetic Biology Platform

In 2016, Luo Xiaozhou, who had just earned his Ph.D. in Chemistry from The Scripps Research Institute in the United States, held two job offers from different top-tier laboratories and was deliberating over his next career move.

On one side was research on antibody drugs, and on the other was the emerging field of synthetic biology. Luo Xiaozhou ultimately chose to join the laboratory of Jay Keasling, a pioneer in synthetic biology and member of the National Academy of Engineering at the University of California, Berkeley, even though his understanding of synthetic biology was not yet fully clear at that time. Prior to his postdoctoral research, Luo’s work had largely focused on chemistry-related topics.

“Before starting my Ph.D., I had probably never even ‘cultured’ a single E. coli cell. I had virtually no experience with biology-related projects,” Luo Xiaozhou joked. Why did he ultimately choose to pursue research in synthetic biology? Luo cited two reasons.

“First, ‘I have always believed that automation can significantly enhance the efficiency of scientific research by helping scientists tackle repetitive, mechanical, and error-prone foundational tasks,’ said Luo Xiaozhou,”Given the inherent high complexity of synthetic life forms, which necessitates massive amounts of engineering-oriented trial-and-error experimentation, automated facilities serve as a critical accelerator for synthetic biology research.Automation in biological laboratories has always been a subject of considerable interest to Luo Xiaozhou.

Secondly, Luo Xiaozhou recalled, “At that time, I was quite uncertain about whether my future lay in continuing scientific research or venturing into the industry. As a pioneer in the field of synthetic biology, Jay Keasling has not only achieved remarkable success in scientific exploration but also exerted a profound influence on industrial development.” Dr. Luo explained that Jay made significant contributions to Amyris’s ability to biosynthesize artemisinin precursors and successfully commercialize artemisinin. Approximately half of Jay’s students have pursued careers in academia, while the other half have entered the industry; thus, joining Jay’s laboratory may have helped him clarify his future career path.

Dr. Luo Xiaozhou, Founder of SYNCERES BIOSCIENCES

It has proven that Luo Xiaozhou’s choice fully aligned with his expectations and yielded many unexpected gains.During his postdoctoral research at the University of California, Berkeley, Luo Xiaozhou successfully elucidated the complete biosynthetic pathway of cannabinoids, with his findings published in *Nature*.Her experience at the Jay Lab, along with extensive interactions with leading figures in academia and industry, further solidified Luo Xiaozhou’s resolve to launch her own venture. In 2019, armed with outstanding scientific research achievements, Luo returned to China to embark on her entrepreneurial journey.

It was not only Luo Xiaozhou’s postdoctoral research experience at the University of California that prompted his transition from academic research to the industry; another individual also played a significant role in influencing his move into the private sector—namely, the current CEO of SYNCERES BIOSCIENCES.Zhou Xibin. Luo Xiaozhou mentioned that he andZhou XibinHaving known and interacted with each other for many years, we share a very close relationship.Zhou XibinWith extensive business experience, I have long looked forward to the opportunity to collaborate with Luo Xiaozhou, who is exploring the frontiers of academic research.

When Luo Xiaozhou’s research findings on cannabinoids were released, they sensed that the two could join forces to build a successful venture.Returning to China to launch a startup, driven by the two individuals’ long-term assessment of the growth potential in the domestic and international synthetic biology markets.

At that time, synthetic biology “super unicorns” such as Zymergen and Ginkgo Bioworks had already emerged in overseas markets, and there were numerous synthetic biology companies listed on secondary markets. Overall, securing a foothold in such a fiercely competitive international market posed considerable challenges.

In contrast, the domestic synthetic biology industry is in its early stages of development, offering greater opportunities and potential, much like a blue ocean brimming with untapped treasures. At this opportune moment, Shenzhen is planning to invest heavily in building major foundational infrastructure for synthetic biology. Senior technical experts in synthetic biology, such as Luo Xiaozhou, who possess both theoretical knowledge and practical experience, have received invitations to return to China and participate in this initiative.

As one of the key projects prioritized for launch and development in the construction of Guangming Science City in Shenzhen’s Guangming District, the Major Scientific and Technological Infrastructure for Synthetic Biology Research involves a total equipment investment of nearly RMB 1 billion, making it the world’s first large-scale infrastructure project to commence planning and construction in the field of synthetic biology.This project aims to help biotechnology companies cross the entrepreneurial “valley of death,” break down spatial barriers between research institutions and startups, effectively overcome bottlenecks caused by startups’ lack of facilities and technical platforms, shorten the time cycle from original innovation to industrial translation, and explore a new model for aligning science and technology with industry—the “Upstairs-Downstairs Innovation and Entrepreneurship Complex.” In January this year, the main building of the major scientific and technological infrastructure for synthetic biology research was officially topped out, with completion acceptance and delivery expected in early 2023.

“The construction of major synthetic biology infrastructure can provide favorable support to startups in many ways, which was very appealing to me at the time,” said Luo Xiaozhou. In the field of synthetic biology research, where demands for platform facilities are extremely stringent, the development of foundational large-scale infrastructure enables startups to avoid the substantial costs of building their own platforms during the early stages when capital is relatively scarce. Moreover, the cohorts of talent cultivated through participation in domestic infrastructure projects have undoubtedly created a fast track for the company to recruit top-tier professionals in the future.

The vast potential of the domestic market and the Chinese government’s proactive policy support prompted Luo Xiaozhou to resolutely return to China in 2019, where he co-founded SYNCERES BIOSCIENCES with Zhou Xibin.

According to its official website, SYNCERES BIOSCIENCES (Shenzhen) Co., Ltd. is a high-tech enterprise engaged in research and development as well as production in the field of synthetic biology. The company primarily utilizes microorganisms as cell factories, leveraging engineering science concepts to artificially create functional novel pathways or new enzymes through logical design and directed evolution of genome synthesis, gene regulatory networks, and signal transduction pathways, thereby producing various active ingredient products.

“The applications of synthetic biology are extensive, and we do not wish to limit ourselves to producing only cannabinoids,” Luo Xiaozhou told VCBeat. He positioned SYNCERES BIOSCIENCES as a platform-based enterprise in synthetic biology, aiming to roll out a diverse portfolio of biosynthetic products in the future to address market demands in terms of both quality and quantity.

Biosynthetic Cannabidiol (CBD) and Cannabigerol (CBG),This is a strategic direction that SYNCERES BIOSCIENCES has already advanced to implementation. The company has filed patents related to the biosynthesis of cannabinoids, and its primary target market in this niche sector will be overseas. In addition, SYNCERES BIOSCIENCES is developing and advancing other high-value product pipelines, such as the biosynthesis of novel liquid rubber materials.

“Liquid new-material rubber is an additive for rubber that enhances its performance characteristics. There is strong market demand for such products. We have currently achieved mass production of this product and have provided samples to certain downstream markets.”“Market feedback has been very positive, and we are exploring deeper collaboration,” Luo Xiaozhou introduced to VCBeat.

Observing the development of the synthetic biology market overseas, it is evident that platform-based synthetic biology companies must ultimately launch biosynthesis-related commercial products to secure a solid foothold in the market. SYNCERES BIOSCIENCES recognized this early in its development.

The synthetic biology infrastructure vigorously developed in Shenzhen has provided startups like SYNCERES BIOSCIENCES with a comprehensive platform and supporting facilities. This has enabled SYNCERES to avoid the substantial costs associated with building such platforms and recruiting specialized talent during its early stages, allowing the company to focus exclusively on product-oriented research and development.

SYNCERES BIOSCIENCES has its own considerations on how to selectively develop relevant products based on market demand.

“Developing products with a market-oriented approach does not mean that SYNCERES BIOSCIENCES produces whatever the market demands,” said Luo Xiaozhou.Before committing to the development of a high-value-added product, SYNCERES BIOSCIENCES conducts thorough pre-development assessments.

First, assess the complexity of the production process based on the company’s laboratory-scale and pilot-scale workshops; second, evaluate the product’s market prospects; and third, determine whether the biosynthetic route for the product can significantly enhance its functionality and quality compared to traditional methods. Luo Xiaozhou stated, “For biosynthesis-related products, it is not only about achieving sufficient “quantity”; “quality” is equally important, meaning a high cost-performance ratio is essential.“As long as a delicate balance is maintained between ‘quality’ and ‘price,’ resulting in high cost-effectiveness, the corresponding market demand can be met.”

SYNCERES BIOSCIENCES not only has a clear strategic positioning for its own development but also deeply understands the principle that “many hands make light work” in terms of specific execution, skillfully leveraging external resources to drive business growth.

In late May 2021, news of a strategic partnership between Angel Yeast, the leading yeast manufacturer, and SYNCERES BIOSCIENCES, a synthetic biology startup, to establish a joint venture appeared on multiple self-media platforms.The signing of this major partnership represents a win-win scenario for a traditional industry leader and an emerging innovator. For SYNCERES BIOSCIENCES, the direct impetus for this collaboration stems from the urgent need to rapidly industrialize its product pipeline.

Luo Xiaozhou told VCBeat that, in the course of delivering samples to the market, the company found that customer demand for samples had surpassed its maximum production capacity—making it urgent to expand product capacity and achieve industrial-scale manufacturing. However, building a factory that meets production standards and can rapidly achieve mass production would undoubtedly take time, while customer demand was pressing.

At this opportune moment, Angel was also seeking suitable partners to help expand its footprint in new fields. The two parties quickly reached an agreement and joined hands to establishHubei Angel Synceres Biotechnology Co., Ltd.To jointly promote the development of a green synthetic biology industrial cluster based on synthetic biotechnology.

It is reported that the joint venture’s initial registered capital is RMB 10 million, with Angel Yeast contributing RMB 4 million. SYNCERES BIOSCIENCES will take a 60% equity stake by contributing part in cash and part through the assessed value of intellectual property rights associated with three projects: CBD, CBG, and new material rubber. Angel Yeast will hold a 40% equity stake through its cash contribution.

The successful conclusion of this collaboration was built on a solid foundation laid by the partial overlap in the two parties’ business operations.

As the world’s third-largest and Asia’s largest leading enterprise with yeast production as its core business, Angel Yeast has accumulated extensive expertise in the large-scale industrial production of yeast. SYNCERES BIOSCIENCES leverages yeast as a cell factory to synthesize high-value-added products.. Therefore, the conclusion of this strategic partnership not only promptly addresses SYNCERES BIOSCIENCES' needs for production facilities (Angel Yeast provides some pilot-scale production workshops and equipment that can be used by SYNCERES BIOSCIENCES after minor modifications), but also leverages Angel Yeast's advantages in supply chain, manufacturing processes, and process quality management, enabling SYNCERES BIOSCIENCES to implement its industrialization strategy with greater flexibility.

For Angel Yeast, the partnership with SYNCERES BIOSCIENCES has enabled a successful cross-industry expansion from the traditional yeast fermentation sector into synthetic biology, addressing its limitation of having a single industrial focus and further advancing the company’s sustainable development. Moreover, the in-depth collaboration with SYNCERES BIOSCIENCES creates synergistic support for the growth of Angel Yeast’s other subsidiary business segments.

SYNCERES BIOSCIENCES, advancing hand in hand with Angel Biotech, has entered a fast lane of development. Moving forward, SYNCERES BIOSCIENCES will strategically position itself in the following areas:

First,SYNCERES BIOSCIENCES will intensify its efforts in building R&D platforms, focusing on innovative automated synthetic biology R&D and AI-driven intelligence. The company aims to develop proprietary automated processes, establish component and strain libraries, integrate automated analysis systems, and develop machine learning algorithms.

Second,Build a Modern Industrialization Platform. In 2022, the company will invest in constructing a one-touch-start, fully automated synthetic biology fermentation plant, along with its supporting supply chain, production process control, and quality assurance systems, to achieve stable, efficient, and low-cost industrial manufacturing capabilities.

Third,Engage in comprehensive cooperation with leading enterprises across various industries, including Angel Yeast, to strategically position ourselves in the research and development, production, and sales of end-user application products, thereby building an industrial cluster for green manufacturing via synthetic biology. We strive to develop SYNCERES BIOSCIENCES into a synthetic biology company with strong competitive advantages across the entire industry chain within three to five years, driven by market demand, powered by R&D as its core engine, and supported by robust manufacturing capabilities.

Let us look forward to SYNCERES BIOSCIENCES opening a new chapter in its future development.