COSMOFACTORY

This transcript is automatically generated, and manually edited.
Deanna: [00:00:00] This episode is about the future of palm oil. It's about specialty chemicals as well as commodity chemicals. It's about fungus, yeast, and fermentation technology. It's about the environmental and regulatory realities of deforestation and much more. With me for today's episode of Cosmofactory is Shara Ticku, co founder and CEO of C16 Biosciences.
Deanna: Welcome.
Shara: Thank you. Thanks for having me, Deanna.
Deanna: I'm glad you're here. Thank you. Um, will you please just [00:01:00] start by giving us a quick introduction to C16 Biosciences and what the company does.
Shara: Yes, gladly. Z16 is a New York City based biotechnology company that produces high performance ingredients that leverage the best combination of natural and scientific innovation. Thank you again. for consumer products, including beauty and personal care,
Deanna: Wonderful. Nicely done. Um, now, because we can't all be chemists, and I'm fascinated by words, um, I want you to tell me if I have this right, uh, palm oil is rich in a fatty acid that's known as palmitic acid, and each molecule of this palmitic acid is made up of 16 carbon atoms, uh, 32 hydrogen atoms, and 2 oxygen atoms, so my presumption is that the C 16 company name is a reference to those 16 carbon atoms, yes?
Shara: right? Yeah. So, so palmitic acid is, is colloquially known as C16 fatty acid, and it is not the only [00:02:00] fatty acid in palm oil, but it is the most present and the namesake, which is, uh, the reason for our namesake as well.
Deanna: Excellent. Cool. I love that. if I recall correctly, you and I first met at the Society of Cosmetic Chemists annual meeting in New York City a few years back. I also remember not meeting you for what felt like years, maybe it was only a matter of months before that particular SCC event. And this is because C16 Biosciences was making headlines in beauty industry trade publications well before you launched your first ingredient.
Deanna: I was very curious to learn more about what you were doing. So I'll ask you now to Please tell us about the early work your team did to develop your biomanufacturing platform. What was going on in the early days at C 16?
Shara: Yeah, I mean, we're, we're a biotech company and that requires research and development. It requires innovation. It requires a big idea and then proving that you can actually make it work. And in the early days of building the company, [00:03:00] we were very heads down on proving that our big idea could actually be validated, could be technically viable, economically viable and scalable.
Shara: Before we launched. So we did get some headlines. We actually tried to stay sort of under the radar, um, working on a big problem that people wanted to talk about, but we did decide to wait many years to commercialize until we really felt the product was ready to bring to market. And so what we were doing was really working in the lab.
Shara: Um, and if you come visit our lab, which is 20, 000 square feet in Manhattan, Overlooking. Hudson Yards and the Hudson River, you'll see things similar but different to what you might find in a cosmetics formulation lab. So you'll find things like agar plates and shaped flasks and bioreactors for growing microorganisms to produce sort of what we call the new natural ingredients.
Shara: And in [00:04:00] the early days, that's what we were working on was the, the basic It's biology. There's some chemistry to, um, to develop what we call our bio manufacturing platform.
Deanna: Yeah. Very cool. Thank you for that. And your microorganism is a yeast. Is that true?
Shara: Our primary microorganism is a yeast. We have looked, we work mostly with yeast, but we've also explored, yeah, I think you mentioned bacteria and algae as well. Um, and the basic premise of what we do is leveraging those natural microorganisms. For us today, it's, it's a yeast to make high performance, highly sustainable ingredients.
Deanna: yeah, yeah. So we know that not all biotech ingredient innovation relies on fermentation the way that yours does. Um, my question for you then is why did you opt for a fermentation based platform? Why was that the right choice?
Shara: So, you know, when we started our, our namesake is C16, when we started our, our ambition was really around palm oil and looking at [00:05:00] palm oil as a highly ubiquitous ingredient. It's found in about 50 percent of products on supermarket shelves, actually in cosmetics and personal care. It's, it's found in about 70 percent of products.
Shara: So the number's even higher. And as we looked at that ingredient, we realized it was. It was a really valuable player, right? Like it was doing a job that was unique, hard to replace with other ingredients. Workhorse super important for functionality across multiple products, and all of that was really good.
Shara: But what was bad was the way that it was being produced, which involved industrial monoculture deforestation of tropical forest to clear that land, which, you know, palm oil can only grow in really, really specific areas right around the equator. Massive amounts of greenhouse gas emissions. loss of biodiversity, et cetera, et cetera, et cetera, to make this vegetable oil.
Shara: And so when we started the company, [00:06:00] I met my co founders, um, at the MIT Media Lab in, in Boston. We were, the three of us were at Harvard and MIT in grad school for Different things all touching biology in different ways, but we were looking at palm oil and said, this is a great thing. The only problem is the way that it's made.
Shara: Could we make it a different way? And, you know, I think we had a hypothesis around using microorganisms to make it. Just like plants, the oil palm plant can naturally make these fatty acids. There are some microorganisms, including some yeast, which naturally make these fatty acids. And so we tapped into that basic idea and said, could that be possible?
Shara: What would have to be true? And we approached it that way. So I think, you know, we were very problem centric. We weren't tied to the technology being fermentation, but we had a strong hypothesis early that it could work and could scale similarly to plants. And so we gave it a shot.[00:07:00]
Deanna: Yeah. Yeah. Very cool. You mentioned there that a palm oil sourcing does come with some ethical and environmental challenges. Can you share more about what I might think of as the state of palm oil today and remind us why we love using it so much? Uh, and more about why it's problematic as it's conventionally sourced.
Shara: Yep. So today, palm oil alone is about a 70 billion industry. It is the most widely used vegetable oil in the world. And as I mentioned, it's found in about 50 percent of products on supermarket shelves, but about 70 percent of cosmetics and personal care products. Palm oil is really unique. You hit it right at the beginning in terms of its fatty acid profile.
Shara: So we won't get too much into the chemistry, but the composition of fatty acids in palm oil. allow it to perform so well in end products. And so it can be used as a whole oil, or it can also be used as a sort of platform or intermediary in which it's [00:08:00] broken down into composite parts, fatty acids, or fatty alcohols, and then transformed into dozens of different ingredients that show up on the back of things.
Shara: Labels that are include emollients, emulsifiers, esters, surfactants, and then as we look in food, a lot of the, again, emulsifying properties, um, or even stabilizers. And so. The unique properties of palm oil, which are different than every other vegetable oil, it's got a really, really unique profile, help drive performance benefits like.
Shara: Oxidative stability and shelf stability, it makes it really good at formulating and other ingredients. You can take the C 16 and C 18, or even the C 12 and C 14, and turn those into surfactants, which are required for anything in body care or laundry care. And you really can't get those molecules elsewhere.
Shara: So palm oil is really critical. [00:09:00] Everybody likes the performance of it, but like I alluded to earlier, the problem is really just the way that it's made, which requires Land right around the equator. That land is primarily home to tropical rainforest and historically growers have been slashing and burning that land, clearing it to convert it to oil palm.
Shara: Pretty much everybody in the industry knows about this problem, has deemed the problem. Has frankly tried to commit to sustainable sourcing of palm oil. So sourcing palm oil and its derivatives that don't engage in deforestation of high carbon stock land. It's just been really hard to do that. The supply chain is.
Shara: Really opaque, it's nearly impossible to know if. You know, the emollient in my lip balm came from a plot of land that did or didn't engage in deforestation. [00:10:00] Supply chains are way too complex and opaque. And even though we've had efforts at certifying sustainably sourced palm oil, that's really capped out at less than 20%.
Shara: And so that is not a global solution to this problem. It can help one player solve the problem, but it's not, it's not a global solution. And It's been a big push from consumer groups. There's been a big push from NGOs like Greenpeace, um, Forced Corporate Change, and many of the consumer goods manufacturers themselves have made the push, but we haven't really seen solutions.
Shara: And, you know, I think that's part of, that's part of why we're here today.
Deanna: Yeah. Yeah. Thank you for all of that. And folks who are paying attention to this issue will know that, um, by the end of this year, 2024, the EU deforestation regulations, uh, that affect palm oil sourcing will take effect. And you've, you've touched on deforestation there quite a bit, but help us understand what beauty makers will be faced with in the regulatory [00:11:00] landscape going forward.
Shara: Yeah, so I'll talk about, um, the EU regulations for POM and maybe I'll even just hit on regulation more broadly. So EUDR, EU Deforestation Regulation, and there's there's 2 more, um, laws that have just been passed by the European Commission, uh, EU, uh, um, Sustainability Due Diligence, around Sustainable Due Diligence and Sustainable Supply Chains are the regulations coming into play.
Shara: And basically, this is elevating the Expectation or the sort of barometer in which companies can claim that they have sustainably sourced ingredients. And so for in particular, this is covering 7 key crops, including palm oil and oil. And any company that's sort of importing those ingredients and using them in their products now has to prove that the palm oil did not [00:12:00] come from deforestation and the standard that many companies use today, for example, a mass balance standard, which says, you know, At least 51 percent of the palm oil that came to me did not come from deforestation and it's certified by this 3rd party.
Shara: That's not good enough. So EUDR has really elevated the standard for claiming sustainability and companies that fail to meet it can actually be fined up to 4 percent of their annual revenue or turnover. Which is material. So this is a really, really big landmark piece of legislation covers palm, but it also covers crops like coffee and cocoa and things like this.
Shara: Um, and I would say, you know, most companies are aware of it, are working swiftly to find solutions. And really, the only answers we hear, and we talked to a lot of people in the supply chain, which I think is an ingredient manufacturer, it gives us some unique insights, but formulators, CMOs, distributors, [00:13:00] brands.
Shara: Most of them realize at the very least, it's going to be materially more expensive to do this traceability if they can do it at all. And I think this is where solutions like ours, we're not the only solution, but biotech driven solutions, alternative types of solutions. Ways of making ingredients that don't come from these extractive agricultural processes, in addition to improved traceability in agriculture, all have to come, come about.
Shara: And I'll just hit quickly on 1 more,
Deanna: Sure.
Shara: the New York State Assembly bill. enacting the sort of beauty justice act, which is about regulating ingredients and personal care and cosmetics, which again, many of your listeners are probably aware, but it's also going to restrict certain ingredients, one of which is ethylene oxide, EO, right?
Shara: And so again, as we talk to a lot of these end product manufacturers, mostly brands, They're worried about this. [00:14:00] They're saying, okay, this legislation is restricting some really important workhouse surfactants that we never thought would get taken away. If that's going to go away, what else in my toolbox might go away?
Shara: And I think that just opens a broader conversation about ingredients and about supply chains and about sourcing to say, we've taken for granted where our ingredients come from, but there's actually this whole set of innovative options, and actually it's a place where sustainability can drive innovation to unlock.
Shara: Both drop in ingredients, so ingredients that replace things we use today, but also totally novel, better performing ingredients. And I think that's just a really exciting place to be in, in the sort of beauty and personal care world.
Deanna: Yeah. Yeah. Let's talk about your ingredient in that context. So, tarula oil, if I were to briefly describe it, I would say it's an antioxidant rich emollient, um, which might be, might be accurate. [00:15:00] You'll help me know. Um, but it helped me help us think about how it functions as a drop in replacement, but rather how it also really stands alone as a novel ingredient that can maybe just happen to also do the work of palm oil.
Shara: Yeah, and I think true oil is I love it as a product. Obviously, I use it on my face every day. Um, but I think I like it because it's like a really good microcosm or capsule of what biotech can unlock in this industry. You know, with ingredient companies, people often ask, you know, is it a replacement ingredient or is it a new ingredient.
Shara: And with biotech, the answer can be both. And so we started out looking for a palm oil replacement. So we said, okay, it needs to be this workhorse oil, but this chemical profile, let's see if we can make it. And we did pretty well at that on our first go, but we also along the way learned that these natural microorganisms that were, we were using to produce the [00:16:00] oil, had a whole bunch of untapped resources that we could actually.
Shara: Explore and extract through our sort of technology set. So with to rule oil, it's an oil. So think about a wide range of oils used in cosmetics, Marula oil, squalane, buckthorn oil. It's operating like that. So texturally formulation wise, it does all the things you want an oil to do. Although with biotech, you can actually create for these novel oil profiles.
Shara: So to rule oil is deeply moisturizing, but it's light. It sinks into skin really quickly. It has almost a silicone like slip or texture, but it's not just an oil. It's a, it's a bioactive oil is what we, what we call, but yeah, antioxidant rich. So it contains these essentially novel historically quite rare carotenoids in particular that promote healthy, vibrant.
Shara: skin. So carotenoids, as you mentioned, are [00:17:00] antioxidants that neutralize harmful free radicals in the body and reduce oxidative stress. We're probably most familiar with carotenoids like beta carotene, which is found in carrots and makes carrots orange, but also drives a lot of the health benefits and nutritional benefits of carrots.
Shara: But in skin, beta carotene is converted into vitamin A, which is crucial for skin health as well. And so with tarula oil, we make beta carotene, but we also found that the yeast that we Discovered and commercialized also produces sort of two rare, not previously commercialized carotenoids that help do so many cool things in terms of barrier protection, natural defenses of the skin, immunity boosting, anti aging.
Shara: And, uh, we can talk about some of those for different applications, but I think it's just such a cool example of. Biotech setting out to actually replace ingredients and along the way you can actually find all the cool novel things [00:18:00] that didn't exist before and produce sort of net new benefits or even novel, novel performance ingredients.
Deanna: Yes, yes, that's wonderful. Thank you so much. Um, and I believe your tarula oil is, um, essentially on the shelf in some consumer products now. Always very exciting for new ingredient makers. Congratulations on that. Um, can you share a bit about the brands or products that have been formulated with tarula oil?
Shara: Yeah, so it's really interesting about true oil is that it's really flexible and so you'll see it in a wide range of sort of. Form functions and people are using it. Brands are using it for different benefits. So, um, some of the products on shelves are, you know, liquid, like the nourishing oil for face, body and hair that we actually launched ourselves.
Shara: Um, you'll see it in creams and moisturizers. Um, so one company, lo this year launched a barrier repair product featuring Toru Oil at a, um, very [00:19:00] high, uh, inclusion level. It's really the hero ingredient in the product, and you'll see it in soaps. So, uh, Panaya, which is actually a. A fashion brand moved into personal care for the first time together with Hale's, uh, super cool UK based brand to launch a soap, a rewild body block bar featuring Toula Oil.
Shara: And then Hagels actually just launched their second product featuring Toula Oil, which is a sun care product. The seaweed Solar Protect SPF 50. It's a, it's a sun care oil using Toula oil. Um, that one's very cool because we've run clinical studies on to rule oils, benefits and some care and those carotenoids.
Shara: We were talking about boost SPF performance. So that's a very big category for us. Um, and then the last 1 that's coming soon is an oil cleanser product. So we're working with, I would say some of the most innovative brands in this space. I have loved getting to work [00:20:00] with many of these founders who are really pushing the envelope in terms of.
Shara: Sustainability as a driver. Of innovation, really questioning the ingredients and the packaging choices that they're making for sustainability. Um, and they've just been, they've been really, really fun to work with and launch products with.
Deanna: that's exciting. Thank you. Um, for some cosmetic formulators listening, I'm hoping you can just briefly tell us quickly about things like color, scent, temperature, parameters, those sorts of details about Tarula oil.
Shara: Yep, we hit on the sort of oil properties before. And again, it's, um, it's got a unique mix of fatty acids. And so it blends in solid form functions like soaps, but also liquids like oils and creams in between, um, I would say color is probably the most interesting part. So, um, the oil itself has this sort of reddish orange sun setty.
Shara: type of color. And that's exactly because of those antioxidant carotenoids we were talking about. The vibrant color is really Mother [00:21:00] Nature's way of telling us something really nourishing is inside. And so we sell the ingredient with the color. Um, and there are, I think, a lot of Benefits driven marketing claims that brands and manufacturers can use leveraging that, um, but we do also have a neutral color for those that are more traditional, which is a sort of, you know, neutral, um, ivory type of color.
Shara: Color. Um, scent. It has a slight oily scent. And again, I think maybe just one thing that's interesting here is sort of the battle between natural and synthetic. I think a lot of people want to talk about C 16 and what we do as synthetic or lab grown. Um, but actually what we do is. Highly natural. And and with that, you see the sort of naturally oily scent.
Shara: Um, so it's there. But again, I think you can use the product. Maybe just one surprising thing for formulators. It's a bioactive oil. It contains active ingredients. [00:22:00] We expected people to be using it at pretty low inclusion levels, but we've seen people using the product up to 40 percent inclusion. So, you know, I think all of these things, color, scent, and performance can be modulated up or down.
Shara: You're using it at 40%. It's really different than using it at
Deanna: Yes,
Shara: Um, so it really hits a wide range, and we spend a lot of time with formulators, chemists, CMOs, and brand owners themselves talking through different application sets.
Deanna: Yeah, very cool. Um, so based on our conversation, um, I'm going to presume that C 16 will not be a single ingredient manufacturer. Before we wrap up here, I just want to ask, uh, what is in your development pipeline? What can you share with us about the future?
Shara: Yeah, so so true oils are first ingredient and it's been it's been really fun bringing that one to market. Um, what's next, but not yet on the market is a broader range of specialty and commodity ingredients, including of course sort of back to [00:23:00] our roots and our original mission, which are many of the traditional palm oil derivatives.
Shara: So. emollients, emulsifiers, surfactants. These are, they're different than chlorella oil, right? Chlorella oil is a novel ingredient. It's high performance. It's driving claims on front of PAC about the benefits. A lot of what we want to grow into next are these sort of workhorse ingredients. And so these are large volume markets and we're really working with some of the largest players in the space to bring this to market.
Shara: So sort of a different strategy than bringing to rule oil to market, but you will see some more. Ingredients like to rule oil coming to market that have this sort of novelty high performance angle. Um, but we're also very, very excited about bringing some of these large volume palm oil replacements to market, especially given the timeline when we started the company.
Shara: You know, [00:24:00] climate change was not top of mind. There was definitely no regulation forcing these ingredients out. I think with and some of these other mandates coming. A lot of our customers are actively seeking solutions, alternatives for things like Palm. And so we are now operating at scale. We want to help them bring those to market.
Deanna: Yeah, no. And I think that's so important. You know, it might be fair to say that functional ingredients and commodity chemicals in some ways have been overlooked in the biotech conversation. So it sounds like you're doing very important work there. Yeah, well, I thank you so much for joining me. I, this was a fantastically informative interview.
Deanna: Shara, thank you for being on the Cosmofactory podcast today.
Shara: Thanks for having us.
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