Government funding advances biomanufacturing in the US

The US has long trailed Europe in the amount of government support available for biobased chemical firms, but industry analysts say a collection of programs rolled out over the past 18 months is helping the country catch up.

The latest boost is the US Department of Defense’s (DoD) Distributed Bioindustrial Manufacturing Program, which aims to shore up food, fuel, and chemical supply chains by advancing fermentation technologies.

Over the past 2 months, the program has doled out $23 million in grants to help 13 start-ups plan pilot plants for biobased products. The companies received initial grants of up to $2.5 million, and the most promising projects can apply for up to $100 million in follow-on funding. The DoD expects to fund more than 30 projects.

The selected companies are pursuing a variety of fermentation technologies. Arctos, for example, is planning a facility that produces protein-based fibers, films, and adhesives. Visolis is designing a plant to make chemicals for explosives and fuel, and Better Meat will make fungal protein for food.

The funding is part of the DoD’s response to a 2022 executive order that instructed various government agencies to bolster the US’s biomanufacturing capabilities. The DoD took a major step in 2023 when it added $450 million to the budget of BioMADE, a public-private partnership that supports biomanufacturing.

Other government branches are also increasing funding for industrial biotechnology. Last year, the Department of Agriculture guaranteed a loan for a contract fermentation facility that Liberation Labs is building in Indiana. The Department of Energy announced in June that it’s backing a $214 million loan for a Solugen plant in Minnesota that will produce biobased glucaric acid, gluconic acid, and hydrogen peroxide.

In July, the Department of Commerce awarded two consortia of biotech firms, universities, and economic development agencies $50 million each to build technology hubs in the Midwest. Part of the funding will be used to help the grain processor Primient convert an idle fermentation plant in Indiana into a contract manufacturing facility with bioreactors ranging from 1,500 L to 13,000 L. And the Applied Research Institute will use the funding to create a facility in Illinois with bench- and pilot-scale bioreactors for training fermentation plant workers.

Jason White, president of the bioeconomy advisory firm Lee Enterprises Consulting, says the flow of government support will allow more early-stage companies to test their ideas, move forward, and attract private investors. “This is trying to kick-start those success stories—or at least give them an opportunity,” White says.

Kristin Marshall, a chemical industry analyst with the intelligence firm Lux Research, says the programs address biotech firms’ concerns about the lack of pilot-scale fermentation capacity in the US compared to Europe. But she says many of their fermentation processes are probably still too expensive to succeed at commercial scale.

“I think in some places you will see success where it’s straightforward and makes sense,” Marshall says. “But for other things, it’s going to be hard to compete with petrochemical products.”