Document Type

Working Paper

Date of this Version

4-20-2018

Abstract

The overall process to produce malonic acid has not drastically changed in the past 50 years. The current process is damaging to the environment and costly, requiring high market prices. Lygos, Inc., a lab in Berkeley, California, has published a patent describing a way to produce malonic acid through the biological fermentation of genetically modified yeast cells. This proposed technology is appealing as it is both better for the environment and economically friendly.

For the process discussed in this report, genetically modified Pichia Kudriavzevii yeast cells will be purchased from the Lygos lab along with the negotiation of exclusive licensing rights to the technology. The cells will be grown in fermentation vessels, while being constantly fed oxygen, glucose and fermentation media. The cells will excrete malonic acid in the 101 hour fermentation process. In order to meet a production capacity of 10M pounds of malonic acid a year, 236 total batches are needed. The fermentation broth will then be fed continuously to a downstream process which includes vacuum filtration, reverse osmosis, and crystallization to produce a solid malonic acid powder. After drying, malonic acid crystal powder of 99.9% purity will be sold to the cosmetic, pharmaceutical and petrochemical industries.

The design requires an initial investment of $23.1M. The investors’ rate of return (IRR) is 52.6%, the return on investment (ROI) is 46.9% in year three, and the net present value (NPV) is $59.6M in 2018. Sensitivity analyses on the licensing fee and price of cells concluded that these prices are negotiable with Lygos, Inc. This design is recommended based on the process specifications and economic viability of the process, but the success of this project largely depends on the agreement that can be reached with the originators of the technology, Lygos.

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Date Posted:20 April 2018