Microbiogen and the Use of Directed Evolution of Yeast to Solve the Challenge of Producing Lignocellulosic Bioethanol at Scale

12 Pages Posted: 8 May 2019

See all articles by John Mathews

John Mathews

Macquarie University, Macquarie Business School

Date Written: April 12, 2019


The Sydney-based firm Microbiogen is engaged in a highly ambitious quest to develop new strains of yeast that could be used in processing and fermentation of non-edible biomass to produce bioethanol. First generation biofuels like bioethanol are produced from sugar or starch biomaterials and thus invite criticism in the form of food vs fuel. But second generation (2G) biofuels are derived from the whole plant, or non-edible residues (lignocellulosic biofuels), thus avoiding the food vs. fuel conflict. The central challenge is to produce new strains of yeast (Saccharomyces cerevisiae) that can act not just on the hexoses produced from starch and sugar, but also on the pentoses derived from the woody biomass of lignocellulosic material. While many biotech firms have tackled this challenge, attempting to produce new varieties of yeast through genetic recombination, they have not met with complete success. Microbiogen, by contrast, utilizes a biomimetic approach harnessing the power of evolution to generate new strains of yeast that are robust and flexible while meeting the central challenge of broadening their application from C6 to C5 sugars. This case describes the trajectory of Microbiogen (MBG) since its founding in 2001, leading to its selection as partner of choice by the world’s leading enzymes company, Novozymes, in the Danish company’s bid to become a key player in the world’s second generation market for lignocellulosic bioethanol. MBG has negotiated a global cooperation agreement with Novozymes, to supply NZ with its yeast varieties produced through directed evolution. MBG was awarded a grant from the Australian Renewable Energy Agency (ARENA) in November 2017 to assist in producing the new strains of yeast by its preferred Directed Evolution method. The case sets these efforts by MBG in their technological and business context, including the point that the 2018 Nobel prize for Chemistry was awarded to three chemists who have produced new enzymes and antibodies utilizing Directed Evolution. This award strengthens the scientific and technical validity of the approach taken by MBG to producing valuable biomaterials.

Keywords: bioethanol; lignocellulosic biofuel; second generation biofuel; directed evolution; genetic manipulation; yeast

JEL Classification: Q01

Suggested Citation

Mathews, John, Microbiogen and the Use of Directed Evolution of Yeast to Solve the Challenge of Producing Lignocellulosic Bioethanol at Scale (April 12, 2019). Available at SSRN: https://ssrn.com/abstract=3370770 or http://dx.doi.org/10.2139/ssrn.3370770

John Mathews (Contact Author)

Macquarie University, Macquarie Business School ( email )

New South Wales 2109

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