Business plan Cellulozyme - Astrosurf · For example in France the TIPP ... from sugar cane and from cellulosic feedstock. ... Business plan Cellulozyme 5 Collection of

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Introduction ................................................................................................................................ 1 1 General overview ............................................................................................................... 2 2 CELLULOZYME in December 2006................................................................................ 6

2.1 Our history.................................................................................................................. 6 2.1.1 Initial idea........................................................................................................... 6 2.1.2 First phase .......................................................................................................... 6 2.1.3 Second phase ...................................................................................................... 6

2.2 Our team..................................................................................................................... 7 2.3 CropsBreaker:............................................................................................................. 7

3 Market Study ...................................................................................................................... 8 3.1 Market for agricultural-waste-based ethanol.............................................................. 8 3.2 Market for industrial enzymes.................................................................................. 10 3.3 Customers................................................................................................................. 10

3.3.1 Global potential customers............................................................................... 10 3.3.2 Three examples ................................................................................................ 11 3.3.3 Small European companies: ............................................................................. 11

3.4 Competitors .............................................................................................................. 12 3.4.1 Novozymes....................................................................................................... 12 3.4.2 Genencor .......................................................................................................... 13 3.4.3 Advantages of our product CropsBreaker ........................................................ 13

4 Scientific development ..................................................................................................... 14 4.1 Design of recombinant proteins and molecular cloning........................................... 14

4.1.1 Construction of the chimeric scaffoldin ........................................................... 15 4.1.2 Substrate and enzymatic hydrolysis: ................................................................ 17 4.1.3 Construction of Cellulase Chimeras:................................................................ 17

4.2 Family shuffling of endoglucanases:........................................................................ 19 4.2.1 Principle: .......................................................................................................... 19 4.2.2 Cloning:............................................................................................................ 20 4.2.3 Family shuffling PCR: ..................................................................................... 20

4.3 Protein Expression and Purification:........................................................................ 21 4.3.1 Expression system:........................................................................................... 21 4.3.2 Screenings and selection: ................................................................................. 22

4.4 Industrial Production Process................................................................................... 23 4.4.1 Principle: .......................................................................................................... 23 4.4.2 Small scale production: .................................................................................... 23 4.4.3 Scale up: ........................................................................................................... 23

5 The company’s strategy ................................................................................................... 25 5.1 Exploitation calendar................................................................................................ 25 5.2 General strategy........................................................................................................ 26 5.3 Material needs .......................................................................................................... 27 5.4 Human Resources..................................................................................................... 27 5.5 Legal aspect.............................................................................................................. 27

5.5.1 Cellulozyme: the Company.............................................................................. 27 5.5.2 Patent and Registered Trademark .................................................................... 28

6 Financial aspects .............................................................................................................. 28 6.1 Before the creation of the company ......................................................................... 28 6.2 Cellulozyme finances ............................................................................................... 29

7 SWOT analysis :............................................................................................................... 30

Business plan Cellulozyme

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Introduction The past decade has seen a renewed interest in the production of fuel ethanol from lignocellulosic biomass, primarily as a means to reduce fossil fuel dependence and mitigate the environmental problems associated with its continual use. While there have been many processes developed over the years that can technically produce the ethanol from lignocellulosic biomass, significant barriers to full-scale commercialization of cellulose-to-ethanol processes remain. Most current processes include an enzymatic conversion of the cellulose component to glucose step with enzyme costs being a major factor in producing ethanol. Consequently, there have been many attempts to find a better way to reduce the overall cost of the state-of-the-art of the enzymatic hydrolysis step. For this reason, we have created Cellulozyme, an innovative biotech company, which aims to produce a new kind of enzymatic cocktail. More exactly, a multienzyme complex with several enzymes fixed to a scaffolding molecule, the scaffoldin, was developed that is about 20 times more efficient than the ones of our competitors Novozymes and Genencor.


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1 General overview Current state of renewable energies The international energy agency predicts that if governments stick to their current policies in the energy sector over the coming decades, global energy demand will be more than 50% higher by 2030. Resources of coal, oil and natural gas are limited. Nevertheless, the consumption of fossil fuels will not decrease. In contrast, with the expanding industrialization in developing countries and increasing demand for energy supply, we can make the assumption that oil prizes will further increase. Becoming aware of global warming, the public pressure on politicians to reflect about ecology has increased since 1980. Concepts for sustainable development and international environmental guidelines such as the Kyoto protocol have been developed. Additionally, research for new kinds of energy has been supported by governments for political reasons to be less dependent on foreign energy supply. Various alternative energy sources have been discovered, like solar energy and biofuels. Biofuels and Bioethanol Any fuel that is derived from non-fossil biomass, such as energy crops, straw, wood residues, and all kinds of biological wastes is considered as biofuel. There are three types of biofuel: biodiesel, biogas and bioethanol. Biofuels can be divided into two generations: 1st generation biofuels are made using commercial processes that have already been widely adopted by industry. The raw materials come from agriculture and food processing. The overall potential of first-generation biofuels to contribute to renewable fuel demand is limited by crop ranges, climate and by current and future nutritional demands. 2nd generation biofuels are derived from non-food feedstock including lignocellulosic biomass and agricultural wastes. Cellulosic bioethanol is estimated to become a growing future market. Bioethanol can be produced either from sugar, starch or from cellulose. The second generation ethanol production process based on cellulose still needs to be exploited. Cellulozyme wants to supply the growing cellulosic bioethanol industry with adapted enzymes for this process. Biofuel in Europe The European Union has a significant potential for production of biofuels. Their consumption for transportation will increase from present low usage - less than 2% of overall fuel - to a substantial fraction. It is estimated that between 4 and 18% of the total agricultural area in EU would be needed to produce sufficient biofuel to reach the level of 5.75% transport fuel substitution in 2010, as required by Directive 2003/30/EC and the level of 20% in 2020. With 2nd generation biofuels, this aim could be reached. In addition, the directive 2003/98/EC allows member states to exempt biofuel of gasoline tax. For example in France the TIPP (Taxe intérieure de consommation des Produits Pétroliers) adds up to 0,5892 €/l for unleaded fuel but only 0.25 to 0.33 €/l for biofuel. In other European countries like Spain, Germany or Poland, there is a total tax exemption for pure biofuels and even for fossil fuels mixed with biofuels. This exemption is required for biofuel to stay competitive.


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Fig 1a : EU quotas of bioethanol utilization Fig 1b : World ethanol production in 2005 Bioethanol in the rest of the world China: The Chinese market currently produces 946 million litres (250 million gallons) of starch-based fuel ethanol per year. And there is no end in sight: due to its booming economic development and increased energy demand, China focuses on biomass- based energy for the future. USA: US are the N°1 growth market for fuel ethanol with an expected 20-25% growth for the next few years. For political reasons, the US government’s policy aims at becoming more independent from the global energy market. Ecological impact Ethanol and biodiesel provide significant reductions in greenhouse gas emissions compared to gasoline and diesel fuel. Several studies find significant net reductions in CO2 equivalent emissions for biodiesel and bioethanol. Especially large reductions are estimated for ethanol from sugar cane and from cellulosic feedstock. The reduction in net CO2 production will also help to achieve the Kyoto protocol. Biomass availability in European Countries: The total biomass use for energy purpose was 56 million tons of oil equivalent (Mtoe) in 2001. However, to achieve the envisaged 12% margin for renewable energy sources in 2010, an additional 74 Mtoe would be required. This will result in a 130 Mtoe total biomass consumption with a splitting between the sectors as follows: electricity 32 Mtoe, heat 24 Mtoe, and biofuels 18 Mtoe. The current quantities of EU-produced biomass for energy purpose are expected to increase by factors 2,5 in 2010, 3,5 in 2020 and up to 4,5 in 2030 .

Fig 2: Comparison between currently used and potential energy contained in agricultural crops residues and livestock waste in Europe.

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Actual methods of bioethanol synthesis and perspectives Currently, bioethanol is produced from crops like corn, wheat, sugar beet and sugar cane. Basic steps for ethanol production are: glucose extraction or starch-to-glucose hydrolysis, yeast fermentation and distillation. Currently, agriculture and forestry systems exploit only a part of their biomass resources while they leave significant “residual” quantities unexploited. To produce the amount required in directive 2003/30/EC, 2nd generation biofuels have to be developed. The use of both the primary and the residual resources through integrated and sustainable pathways should be promoted. Specific non-food, high yield biomass is currently being developed. Recent reports from the U.S. Departments of Energy and Agriculture state that there is enough biomass feedstock for cellulose ethanol production in the U.S. to replace approximately 40% of current U.S. gasoline consumption. With the development of better enzymes and new bioconversion methods, biofuels produced from biomass will become competitive. This is the global background where we want to insert our company Cellulozyme. Costs of bioethanol production Several studies have been made to determine costs for bioethanol production.

Fig 3 : Production costs for 1 gallon (=3,8l) Fig 4: Production costs for bioethanol corn-stover-based bioethanol in 2000 According to ADEME (Agence de l’Environnement et de la Maitrise de l’Energie), bioethanol will be economic when the price of one barrel oil is about $100 (actually 60$). However, with the construction of new companies and the improvement of production methods, the cost could be reduced by 25-30%. General cellulose-to ethanol process: The NREL (National Renewable Energy Laboratory) has developed an economic model for the conditions necessary to commercialise biomass-to-ethanol technology in the USA. The process is based on acid pre-treatment of biomass followed by enzymatic digestion into fermentable sugars and fermentation. One important condition to improve the economic performance of the conversion process is to lower the costs of cellulases at least ten-fold.

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Collection ofbiomass material

Harvesting, storing,transporting

Pre-processingRemoval of foreign and non-plant material, physical sizereduction by chopping ormilling

Pre-treatmentŹ:Heat, pressure or

acid treatmentdepending on the

biomass

Make sugar fractionsavailable for furtherhydrolysis, opens up thefibres

Enzymatichydrolysis

Turing cellulose into glucosewith cellulase enzymes

FermentationYeasts consume the simplesugars (C5 & C6) togenerate ethanol and CO2

DistillationDistillation of fermentationbroth (10% ethanol ) yields99% ethanol.

99%ethanol

Residue mashtransferred to theby-productprocessing area

Solid residues containing ligninand microbial cells can be burnedto produce heat or electricityconsumed by the ethanolproduction process.

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Improved cellulases have been developed through genetic modifications of the fungus strain Trichoderma reesei. Biomass conversion of plant fibre to ethanol requires liberation of the sugar constituents from the lignocellulosic material. Lignocellulose fibres are composed of three major fractions: cellulose, hemicellulose and lignin. The combination of these fractions in the biomass results in a complex structure that protects the plant fibre from physical and microbial attack. Lignin protects the fibre against microbial and enzymatic attack. Hence, the use of lignocellulose as a raw material requires the removal of lignin in order to render the cellulose and hemicellulose fractions accessible for hydrolysis and fermentation. Typically, an initial physical/chemical pre-treatment is applied to open the fibre structure. The subsequent step is to liberate the C5 and C6 sugars from the cellulose and hemicellulose fractions by enzymatic hydrolysis. Fig 5: General process of cellulosic ethanol production Until recently, the enzyme cost for cellulose conversion into hexose and pentose monomers has been a barrier to commercial utilization of plant fibres for bioethanol production. However, over the past five years, scientists have reduced the enzyme cost by a factor of 30. But further cost reduction in this area has to be realized to make biomass utilization economically feasible. In an endeavour to further decrease bioethanol production costs, we have developed a highly active enzyme complex. Additionally, no expensive pre-treatment is required since our enzymes are active on microcrystalline cellulose and are able to separate the cellulosic biomass from its lignin component.


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2 CELLULOZYME in December 2006

2.1 Our history

2.1.1 Initial idea Dr Chloe Maetz is the instigator of the whole project. She did her Ph-D at the University of British Columbia at Vancouver, Canada, working on biofuels, more precisely on the improvement of enzymatic hydrolysis. Then she continued as a post-doc at the BIP Laboratory in Marseille and has been employed there as group leader biofuels/artificial cellulosomes. Realizing the industrial potential of cellulosomes, and not having any entrepreneurial aspirations, her previous boss Pr. Tardif decided to let Dr Maetz exploit this innovation if obtaining a portion of the profit as financial compensation for his scientific work In 2003, Dr Maetz started collaborating with Dr Feil from the UMR 7100 phytopathology in Strasbourg, to help her design a highly active artificial cellulosome. Dr Feil is an expert working on the improvement of enzymes by directed evolution. Together, Dr. Maetz and Dr. Feil envisaged analysing the project in more detail and to make it economically viable.

2.1.2 First phase In 2004, Dr Maetz and Dr Feil first worked separately, in their own laboratories. Dr Maetz designed the scaffoldin. Dr Feil chose the best cellulase enzymes to be incorporated into the scaffoldin. One enzyme was modified by family shuffling and a library of active clones was established. In mid 2005 and thanks to grants we were able to establish our office in the Business Incubator in Illkirch-Graffenstaden where we could use the screening platform from the faculty of pharmacy of Strasbourg to select improved enzymes. As a proof of their initial concept, we achieved in the development and small- scale production of a high- performance cellulosome.

2.1.3 Second phase In the beginning of the year 2006, Dr Maetz and Dr Feil decided to work together with Mrs Schulze, engineer in bioproduction, in order to study best fermentation conditions. We deposed a patent to protect the invention and took part at the « concours d’aide à la creation d’entreprise » section « creation-development » from the French Research Ministry where we gained 450 000€ in June 2006. In July 2006, Mrs Coutel and Dr Schlegel, finance and managing responsibles, joined the team to create our company. In August 2006, we created the SAS company Cellulozyme with a financial contribution of 15 000 euros from each of the five creators. As Dr Maetz has the opportunity there to rent a building for a good prize, we want to establish our plant in Schirmek. In order to produce and to bring our product CropsBreaker to the market, we actually need a second round of investment. The money that we intend to receive will be invested for buying all the material necessary for the production of CropsBreaker, the marketing and further R&D.


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2.2 Our Team We created the Cellulozyme company the 20th of August 2006, it is a SAS with a capital of 75000 euros. The co-founders are:

• Dr Chloe Maetz, 35 years, the Chief Executive Officer and instigator of the project • Dr Anne Schlegel, 34 years, Business Manager, experience in scientific management • Dr Kathrin Feil, 35 years, Chief Scientific Officer, experience in directed evolution • Dipl Ing Ines Schulze, 35 years, Production Manager, great experience in protein

production • Mrs Claire Coutel, 35 years, the Chief Financial Officer but not employed.

The CVs can be found as Annex on the CD-ROM.

Our strengths: Dr Maetz contacted four highly motivated and experienced persons to form a multidisciplinary team around her. Our team combines strong theoretical and practical knowledge about cellulosomal complexes, cellulases, directed evolution, production of proteins and fermentation. Dr Schlegel is experienced in company managing and corporate development, Claire Coutel in finance and administration.

2.3 CropsBreaker: Our product CropsBreaker is a multienzymatic complex able to degrade straw and corn stover. Straw and corn stover are the two main types of biomass available in Europe and in Northern America for the production of bioethanol. CropsBreaker is 20 times more efficient than the cellulase mixtures from our competitors. It works at about 60°C and at a pH range of 4 to 7. It is also very cost-reducing for ethanol producers, as they don’t need anymore to pretreat their biomass with acid.

Dr. MaetzCEO

Dr. SchlegelBusinessManager

Mrs. CoutelCFO

Ing. SchulzeProduction

Manager

Dr. FeilCSO


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3 Market Study

3.1 Market for agricultural-waste-based ethanol A large variety of feedstock is currently available for producing ethanol from cellulosic biomass. Agricultural waste available for ethanol conversion includes crop residues such as wheat straw, corn stover (leaves, stalks, and cobs), rice straw, and bagasse (sugar cane waste). Our company has decided to first focus on straw and corn stover, as they represent the two main cellulose sources in Europe and northern America. In the USA: mainly corn stover: Agricultural residues, in particular corn stover, represent a tremendous resource for biomass ethanol production. Agricultural residues, in the long term, will be the sources of biomass that will support substantial growth of the ethanol industry. At current conversion yields of around 100 gallons per dry ton, the available corn stover inventory would be sufficient to support 7 to 12 billion gallons of ethanol production per year. In comparison, the ethanol production from corn was only about 1.4 billion gallons of ethanol in 1998. In addition, this feedstock is located in an area that has an established infrastructure for collecting and transport. It is also located near existing grain ethanol plants, which could be expanded to produce ethanol from stover. Recent events have altered the dynamics of the US American ethanol market. Due to the rising cost of oil and to become politically independent from fossil energy- delivering countries, the government has made a strong commitment to increase the production of domestic fuels. The 2005 Energy Bill includes a provision for the production of biofuels in the US to reach a minimum of 7.5 billion gallons by 2012. Ethanol is expected to fill a large percentage of this new demand requirement, effectively doubling the industry’s 2004 production levels. Today, approximately 180 million tons of agricultural biomass is produced in the U.S. each year, sufficient to produce 30 billion gallons (= 3,8l--> 115 billion litres) of ethanol, which is equivalent to a 22% of the total volume of gasoline sold in the USA in 2002. Corn stover accounts for 50% of the total biomass production. Over the past five years, scientists have reduced the enzyme costs by a factor of 30, but further cost reductions have to be realized to make biomass utilization economically feasible. ANNUAL US AGRICULTURAL RESIDUES IN DRY TONS / 1 US ton = 907 kg Corn stover, 118 million Wheat straw, 27 million Other grain straws, 7 million Soybean stubble, 24 million This can be converted into 30 billion gallons (=3,8l) of fuel alcohol per year. The cost of agricultural residues is about 30€/dry ton, a third cheaper than the price of a ton of crops. In Europe: Straw and corn stover Straw is a waste product from crop production and therefore its availability is partly related to levels of crop productivity.


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However, straw is subject to substantial regional price fluctuation – in some areas it is highly demanded due to its use as animal feed and bedding. Therefore, large-scale straw to ethanol production is unlikely due to the location of the straw market. In addition, as a waste product, crops will not be grown simply in order to produce straw for ethanol, unless the crops are also used for producing ethanol. With the first pilot plants, we have seen that producing ethanol from straw and wheat on the same site can be very efficient and offers a very competitive price. China: Corn, Sweet Potato, Cassava, Rice straw China is already the third-largest ethanol producer in the world behind the US and Brazil, using mainly corn, cassava and sweet potatoes. Last year, China produced some 190 million tons of rice, which results in roughly the same amount of waste rice-straw. In theory, this biomass resource alone could yield up to 70 million tons of liquid biofuel per year, roughly 1 million barrels of oil equivalent per day. In short, the potential is impressive. Comparison of different Biomasses

2002 2020

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Wheat 55% 350 65% Sugar cane 38% 80 38% Sugar beet 12% 17% Straw-acid hydrolysis 40% 45%

Fig 6 : Bioconversion efficiencies Fig 7 : Feedstock costs versus product costs in 2002 Compared with wheat, corn, sugar cane or sugar beet, straw is the cheaper feedstock but the straw-based ethanol is the more expensive to produce. Reduction in enzyme costs can enormously reduce the cost of the product and make its production economically viable.

Fig 8: Current selling price. At the moment, prices of fuel and cellulosic ethanol are similar. At equivalent volumes, ethanol is cheaper but the energetic yield is 30% lower.

biomasse % of product cost due to feedstock

cost

Product cost $/GJ

Feedstock cost $/GJ

Wheat 75% 27,7 20,84

Corn 96% 14,45 13,94

Sugar cane 169% 11,66 19,67

Sugar beet 268% 31,51 84,30

Straw-acid hydrolysis 29% 38,06 11,21

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Previsions about 2nd generation bioethanol development Phase 1 (until 2010)

• Improving existing technologies • R&D on 2nd generation biofuels and the biorefinery concept. First 2nd generation

bioethanol pilot plants Phase2 (2010-2020)

• Deployment of 2nd generation biofuel production. • Continued R&D to improve lignocellulosic bioethanol conversion and develop

integrated biorefinery processes Phase 3 (beyond 2020) Large-scale production of 2nd generation bioethanol; Development of integrated biorefining production units.

3.2 Market for industrial enzymes

World demand for enzymes is expected to rise 6.6 % to nearly US$ 5 billion in 2010, based on strong gains in key markets such as animal feed, biocatalysts, pharmaceuticals and starch processing. Historically, enzyme demand has been concentrated in more developed economies due to the high value-added nature of enzymes, and the significant technical resources needed for their development, production and application. However, countries such as China, India, South Korea and Taiwan, which have recently emerged as industrialized manufacturing centres with strong national research and development programmes, will play a much larger role in the world market going forward and offer some of the best growth prospects. Overall, hydrolases dominate the global industrial enzyme sales, accounting for 97% of the total. Cellulases market represents $500 million and have 15 to 30% of market share. The major players of the enzyme’s market are Novozymes (43%), Genencor (21%), DSM (9%) and others like AB Enzymes, Genzyme and Genentech. We can consider that there is place for us in this huge market dominated by Novozymes.

3.3 Customers There are a lot of ethanol producers around the world (about 95 in the USA, 70 in Europe and about 10 in Asia). Most of them produce starch-based or sugar-beet-based ethanol. Bioethanol production from agricultural waste is an emerging market with more and more ethanol producing companies entering.

3.3.1 Global potential customers In the United States, most of the ethanol is produced from corn. But as the capacity of corn production is nearly reached, more and more companies want to develop a cellulosic ethanol production facility like Abengoa. Today, corn stover and straw are the most envisaged biomasses for conversion to ethanol. In Canada, there are as many corn-based ethanol producers (Suncor Energy, Seaway Grain Processors) as wheat-based ones (Mohawk Oil, Grain Processors). The company Tembec in Quebec is also developing a lignocellulosic ethanol production facility.


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In Asia, currently most of the ethanol is produced from corn. Some companies are already making pilot plants to extend their raw materials to rice straw. In South America, ethanol is produced from sugar cane. The cellulosic residues named bagasse are for the moment burnt to produce energy. In a couple of years, bagasse can become a great source of biomass but for the moment, there is no intention to use it to produce ethanol. Once this is reality, we will develop a product special for bagasse.

3.3.2 Three examples BC International Corp., based in Dedham, Massachusetts, has developed a technology for converting sugar cane bagasse, rice straw, orchard slash and other waste biomass into ethanol. The company is planning to build a plant in Jennings, Louisiana to produce 23.2 million gallons of ethanol per year from bagasse. BC International is also developing two others projects: the Collins Pine Ethanol Project, a 23 million gallon per year plant using forest thinnings and wood wastes as feedstock, and the Gridley Ethanol Project, a 20 million gallons per year ethanol plant using rice straw as its primary feedstock. Abengoa Bioenergy, headquartered in St. Louis, Missouri, is a company dedicated to the development of biofuels for transport, including bioethanol and biodiesel, to support sustainable development. Through different subsidiaries, Abengoa Bioenergy owns and operates facilities producing and marketing bioethanol throughout the United States and Europe. Its growth strategy is based on improving cost-efficient manufacturing technologies, increasing production and markets –Spain, Germany, France, and Sweden- and developing advanced biomass-to-biofuels conversion technologies. R&D activities are devoted to produce bioethanol from cellulosic biomass. Abengoa Bioenergy is the fifth largest producer of ethanol in the United States, the largest international producer of ethanol, and a leader in the field of both corn-derived and cellulose-derived ethanol production. In Spain, the biomass plant processes 70 tons of agricultural residues such as straw each day and produces over 5 million litres of fuel grade ethanol per year (data 2006). IOGEN Corporation: Established in the 1970s, Iogen Corporation has become one of Canada's leading biotechnology firms. Iogen is the world leader in technology to produce cellulosic ethanol. Iogen is also an industrial manufacturer of enzymes with a focus on products for use by the pulp and paper, textile and animal feed industries. While Iogen’s demonstration plant uses wheat straw, other potential feedstock has been researched like corn stover, switch grass, oat/barley/wheat straw and sugar cane bagasse. The company’s plant treats of up to 40 tons of feedstock per day and produces up to 3 million litres of cellulosic ethanol per year.

3.3.3 Small European companies

In Europe, there are about 10-15 big ethanol producers using sugar beet (like Südzucker), starch from cereals (Abengoa, Royal Nedalco, Agroetanol, KWST) and Wood (Sekab) and a lot of very small producers. Most of them, except Sekab, use non-lignocellulosic raw materials but some of them have envisaged converting cellulose biomass into ethanol in the future. So they can become potential customers.


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Royal Nedalco (The Netherlands): Nedalco uses both molasse and wheat for its alcohol production. In the next few years Nedalco aims to improve the efficiency of its process and to investigate new resources like cellulosic biomass for bioethanol production. Sekab (Sweden): Sekab uses about 2 tons (dry weight) of wood chippings or other raw materials that contain lignocellulose, to produce about 300-400 litres of ethanol per day. Tereos (France and International): Tereos uses sugar beet and cereals to produce ethanol. They are located in Europe and Brazil. One of their wheat plants can transform 840000 tons of wheat into 300 million litres of ethanol. Elsam (Denmark): Together with other Danish companies and research centres, DONG Energy is an international leader in the development of new eco-friendly biofuel-technologies in the transportation sector. It is therefore very encouraging that the Danish government is planning to invest $35 million in a new 4-years research and development programme for the so-called second-generation technologies for biofuel manufacturing. They convert straw and waste to bioethanol. Elsam, which is part of DONG Energy, already has the capability to produce bioethanol from straw. Agroetanol (Sweden): The mission of Agroetanol is to efficiently refine wheat to ethanol for use as fuel. An ethanol plant is in full operation since 2001. The plant produces annually 50 million litres of ethanol intended for gasoline replacement and 45 000 tonnes of protein feed. Vireol (United Kingdom): The company’s plant is the UK's largest bio-ethanol production facility producing 150,000 tons of industrial ethanol from about 500000 tons of wheat and barley per year.

3.4 Competitors As we will provide the market with cellulase enzymes for the production of bioethanol, our direct competitors are other cellulase-producing companies. The most important biotech companies engaged in this sector are Novozymes and Genencor, but there are also some smaller companies and start-ups which are specialized in this area. The company Dyadic International for example has signed an agreement with Abengoa in November 2006.

3.4.1 Novozymes Novozymes is a leading biotechnology company with state-of-the-art expertise in microbiology and biotechnology. The company has become a major supplier of enzymes for US fuel alcohol manufacturers. Their global sales reach 840 million € in 2005 with a net profit of 115 million €. Moreover, enzymes for bioethanol production were one of Novozymes’ strongest growth areas in 2005 and the cost of their cellulases has been dramatically reduced over the last ten years. Novozymes has developed a range of enzymes for fuel ethanol processing, especially for starch-based ethanol production. They also enter progressively into the lignocellulose ethanol market with the launch of a novel enzyme in 2005 for the conversion of pre-treated corn stover which provides a 30 fold enzyme cost reduction. They produce cellulases (Celluclast pH 4.5-6.0, 50-60 °C – 1kg: 20 € HT), xylanases (Novozyme 50030) and ß-glucosidase (Novozyme 188). Novozymes has created a lot of partnerships with ethanol producers, for example with China Resources and Alcohol Corporation for development of ethanol from biomass. Broin and Novozymes, in October 2006, announced a collaboration to take the next steps needed to bring cost-effective ethanol derived from corn stover to the market.


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3.4.2 Genencor Genencor is a big biotechnology company, also producing enzymes. Genencor supplies a wide range of enzymes for the conversion of starch to fermentable sugars (STARGEN™ technology). In 2000, Genencor started to develop low-cost cellulases and other enzymes for the production of ethanol from unused crop and other plant materials: Multiflect™ cellulase, Spezyme CP, Optimash™ XL... Genencor and NREL (National Renewable Energy Laboratory) worked together for 4 years to achieve an estimated cellulase cost in the range of $0.10-$0.20 per gallon of ethanol. This represents an approximate 30-fold improvement in enzyme cost in that model. Genencor managed to reduce some of production costs by switching to the use of a cheaper carbon source, fermentation conditions were optimized and the production strain was improved through random mutagenesis. In addition, the effectiveness of their enzyme mix was improved through the recruitment of additional enzymes for targeted bioconversion and the optimization of enzyme ratios within the enzyme cocktail.

3.4.3 Advantages of our product CropsBreaker All the cellulases made by our competitors are improved single enzymes or a mixture of several cellulases. The enzymatic system used is the one from Trichoderma reesei which consists of two exo-cellulases CHB1 and CHB2 and at least 4 endoglucanases EG1, EG2, EG3 and EG5. In most of the cases, the industrial enzymes sold by our competitors are not purified, but merely a culture supernatant that contains cellulases and a lot of other proteins of unknown function. Contrarily, our company supplies an enzyme-complex of increased efficiency which is due to improved enzymes that synergistically act within the cellulosome. With CropsBreaker we offer a product 20 times more efficient than our competitor’s products. CropsBreaker does not require any pre-treatment, allowing our customers to further optimize their production process.

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Comparison of hydrolysis efficiency of cellulose degradation systems

Cost of feedstock's bioconversion into fermentable sugar at equal enzymatic activity

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Cost of feedstock's bioconversion into fermentable sugar at equal enzymatic activity

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Cost of return on investments of pretreatment Cost of functioning charges of pretreatmentCost of enzymatic hydrolysis

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500€ Base: 1kg of CropsBreaker


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4 Scientific development Cellulosomes are multienzyme complexes first isolated from mesophilic anaerobic bacteria that can efficiently degrade crystalline cellulose and related plant cell wall polysaccharides (1). Bacterial cellulosomes are organized by means of a special type of subunit, the scaffoldin, which is comprised of an array of cohesin modules connected by linker sequences of low complexity, and a cellulase binding domain. The cohesins interact selectively and with high affinity with a complementary type of domain, the dockerin, which is located at the C- Terminus on each of the cellulosomal enzyme subunits, thereby incorporating the enzymes into the complex. Incorporation into such a multienzyme complex and synergistic action of different types of enzymes leads to enhanced degradation of cellulosic biomass (2). We have developed a thermostable chimeric cellulosome (fig.9) which has been proven to be highly active to degrade cellulosic biomass (wheat straw and corn stover), with cellulose degradation efficiencies 20 times above those observed for currently commercially available non-cellulosomal enzyme mixtures. Principally, we generated a recombinant scaffoldin module with high affinity to crystalline cellulose that can bind nine cellulolytic enzymes. We cloned four native cellulolytic enzymes that had been selected for their synergistic activity to degrade wheat straw and corn stover. Additionally, we improved the activity and stability of the cellulosomal enzyme CelR from Clostridium thermocellum using a directed evolution and screening process. In a second screening step more adapted to monitor degradation of our special biomass, we could identify the stoechiometric amounts of the different enzyme components on the scaffoldin that show highest activity towards the degradation of non-pretreated wheat straw and corn stover.

Fig 9: Schematic representation of structure and composition of our chimeric cellulosome. The chimeric scaffoldin will contain an N- Terminal cellulase binding domain (red), followed by nine identical cohesin modules which are connected by a flexible linker (blue). Enzymes CelK, Endo*, BglA, XynZ and Araf are attached via the cohesin/ dockerin interaction. The 3:2:2:1:1 stoechiometry of the enzymes showed the highest activity in the 2nd screening procedure and has therefore been chosen for large- scale production.

4.1 Design of recombinant proteins and molecular cloning Because of better cloning practice, the construction of chimeric sequences was performed in E. coli strain BL2(DE3), using pET22b+ vector for selection and amplification of the plasmid in E. coli (Novagen). For later expression in B. subtilis strain WB800, we used pWB980 expression vector kindly provided by Wong and colleagues.

Endo* Araf51

XynZ

Endo* Endo*

CelKCelK BglA BglA

CBD3 Doc Doc Doc DocDoc Doc Doc Doc Doc

Coh Coh Coh Coh Coh Coh Coh Coh Coh


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4.1.1 Construction of the chimeric scaffoldin Principle: We created a chimeric scaffoldin molecule (fig.9) comprising nine identical cohesin modules for the attachment of nine dockerin- containing enzymes plus a high- affinity class 3 cellulase binding domain (CBD3), connected by low-complexity Pro/ Thr rich linker sequences. The cohesin, CBD3 and linker sequences were cloned by PCR from genomic DNA of C. thermocellum. Determination of final scaffoldin size: It has been shown that cellulosomal activity towards cellulose increases to some extent with increasing size of the cellulosome. This is thought to be due to a higher degree of synergy and the possibility of fine-tuning the proportional content in individual types of enzymes. Therefore it is important that our final molecule contains the highest possible number of cohesin modules, without being too big to be expressed/ secreted. After calculations, a scaffoldin of 178 kDa can still be expressed in B. subtilis. The size of the whole cellulosome will be about 628-1078 kDa. Selection of suitable sequences: Cohesin domain: the interaction of C. thermocellum CelF Dockerin 1 domain with Cohesin 2 is of high affinity, KD> 10-10M-1 (4) therefore we chose these two interacting partners. CBD: we chose the family 3a CBD of CipA from C. thermocellum because of its thermoresistance and high affinity for Cellulose, KD= 0.4µM. Inter-cohesin linkers: we chose a medium linker size of 41 residues, and amplified the natural linker from C. thermocellum together with the adjacent cohesin2 domain. Secretion signal sequence: Our expression vector pWB980 was designed to contain a sacB secretion sequence for B. subtilis. This is required for our large-scale purification and cellulosome assembly process since it will facilitate purification of recombinant proteins from the culture medium. Cloning the chimeric scaffoldin: The chimeric scaffoldin contains 1 CBD 3 and 9 cohesin2 domains plus linker (fig.10b). The sequences were amplified via PCR from genomic DNA, while introducing appropriate restriction sites, and successively cloned into linearized pET22b+ to finally generate pETscaf (fig.10). Plasmid DNA was isolated from E. coli, the insert was excised from pETscaf and sequenced. The insert was then ligated with BamHI and SphI into pWB980 Bacillus subtilis expression vector and transformed into Bacillus subtilis. The chimeric scaffoldin was finally expressed and purified from Bacillus subtilis.


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1. PCR on genomic DNA introduce 11 # restriction sites

2. RE digestion sticky ends

a. Primer Design

C. thermocellum

NcoI A B C D E F G H I XhoI

pETscaf

Fig 10: Cloning of the chimeric scaffoldin a. Genomic DNA from C. thermocellum was amplified, introducing restriction sites for further cloning. In order to be able to incorporate 9 cohesin plus linker domains successively, it was necessary to amplify coh2 with 9 different primer pairs in a way that the restriction sites of two adjacent sequences were complementary. b. Cloning of PCR- derived CBD3 into linearized pET22b+ to generate pETcbd3, successive cloning of coh2 plus linker domains into pETcbd3 to yield pETscaf. c. Primers used for amplification of genomic DNA contained 3 restriction sites. Primers for CBD3 and coh2 + linker were designed in a way that the restriction sites of two adjacent sequences were complementary. The additional XhoI restriction site was necessary for ligating the sequences into pET22b+.

1. PCR on genomic DNA

2. NcoI/ XhoI digestion and Ligation into pET22b

Transfection, Amplification of DNA, Sequencing of Insert

C. thermocellum CBD3C

pETcbd3

3. Next insert: A/XhoI digestion and Ligation into XhoI-cut pETcbd3

NcoI A XhoI

CBD3

CBD3

A B XhoI

Coh2+linker

CBD3

pETcbd3-coh2.1

Transfection, Amplification of DNA, Sequencing of Insert…

c. Detailed cloning scheme and primer design XhoI

b. Cloning Principle

pETscaf

CBD3 CBD3

pETcbd3-coh2.1

pETcbd3 pET22b+

Nco XhoI Nco XhoI

XhoI Nco

Nco


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4.1.2 Substrate and enzymatic hydrolysis

Composition of our selected biomass wheat straw (Triticum aestivum) and corn stover (Zea mays): The complete degradation of plant cell wall polysaccharides requires the orchestrated action of a complex enzymatic consortium. Based on the composition of our biomass (Fig 11) determined using Biomass Feedstock Composition and Property Database from the U. S. Department of Energy, we selected the five most important types of enzymes (Fig 12) to degrade the major components of our substrate, namely cellulose and hemicellulose.

Fig 11: Composition of wheat straw (Triticum aestivum) and corn stover

Polysaccharides Polysaccharides content (% mass)

wheat straw Corn stover

Cellulose 32.64 34.61 Glucan 32.64 34.61 Hemicellulose 22.63 22.21 Xylan 19.22 18.32 Lignin 16.85 17.69 Arabinan 2.35 2.54 Uronic acid, Mannan, Galactan < 3 <3

Enzymatic hydrolysis of cellulose: The complete saccharification of the plant cell wall requires an extensive repertoire of hydrolytic enzymes to degrade both cellulose and hemicelluloses, which comprise the major matrix polysaccharides. Cellulose is a linear polysaccharide consisting of 100 to 20000 glucose units joined together by ß-1,4-glycosidic bonds. Cellobiose is the repeating unit of cellulose. Cellulose chains are further packed into parallel bundles coupled by hydrogen bonds and Van der Waal’s Forces to generate crystalline cellulose with low accessibility for cellulolytic enzymes. At least three enzyme species have to cooperate for efficient degradation of cellulose: An endoglucanase (EC 3.2.1.4) that cuts intramolecular ß-1,4-glucosidic bonds randomly to produce new chain ends and renders it more accessible to exoglucanases (Cellobiohydrolases, EC 3.2.1.91) which degrade the fibre processively from its ends to release soluble cellodextrins and glucose. Endo- and exoglucanases are known to interact synergistically in the degradation of crystalline cellulose. A ß-glucosidase (EC 3.2.1.21) further hydrolyzes the produced cellodextrins to glucose (3).

4.1.3 Construction of Cellulase Chimeras Principle: Cellulases were designed to contain all a universal dockerin sequence from C. thermocellum CelF on their C-Terminus in exchange to their native dockerin domain. Random binding of the enzymes to the cohesin2 modules of scaffoldin means random incorporation of the enzymes into the chimeric scaffoldin. Cellulosome composition could thus be controlled by the stoechiometric amounts of enzymes available for binding. Since we were cloning enzymes with molecular weights varying from 50kDa to 100kDa, cellulase domains were designed to contain their own linker in order to achieve optimal incorporation into the chimeric scaffoldin. We supposed that each cellulase, according to its molecular weight, has its own optimal linker size (fig.13).


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Selection of appropriate native cellulolytic enzymes: CelK is an exoglucanase that hydrolyzes 1,4-beta-D-glucosidic linkages in cellobiose from the non-reducing end and is inhibited by cellobiose. CelK was selected together with XynZ, CelR and CelN because of its relative abundance and thus importance in the cellulosome of C. thermocellum (5). Because of the importance of endoglucanases in the initial steps of cellulose hydrolysis, endoglucanase activity was improved by directed evolution. CelR was the endoglucanase selected for psiBLAST search to identify other homologous genes for family shuffling (see below). Additionally, the ß-Glucosidase BglA was included in the complex to further hydrolyse terminal, non-reducing beta-D-glucose residues with release of beta-D-glucose (6). In function of the biomass that shall be degraded, further types of enzymes will improve the degradation process by removing cross-linkages and degradating hemicelluloses. Based on the composition of wheat straw and corn stover, we selected two additional enzymes: XynZ is a bifunctional enzyme that exhibits xylanase activity to degrade the most abundant hemicellulose xylan by endohydrolysis of 1,4-beta-D-xylosidic linkages. Its additional Feruoyl esterase activity is believed to aid in a release of lignin from hemicellulose and may be involved in lignin solubilisation (7). The two catalytic domains are supposed to act in concerted fashion on hemicellulose, thereby hydrolysing the xylan chain while separating it from the lignin component (8). Since arabinoxylans are abundant components of plant cell walls speculated to play a role in cross-linking of cellulose microfibrils, hydrolysis of arabinoxylan is an important prerequisite for improved utilization of wheat and corn fibres hemicelluloses (9 and 10). The selected alpha-L arabinofuranidase Araf51 is highly efficient in the removal of the alpha-arabinoside decorations of polymeric wheat arabinoxylan (11). In our final cellulosome, each of these components is present in different amounts reflecting the needs for the degradation process of our selected substrate (fig 12). To be compatible with the contemporary state-of-the-art industrial processes applied to degrade cellulosic biomass, enzymes need to be stable in acidic pH and still active at temperatures around 60°C. Higher Temperature also accelerates enzymatic conversion 2 fold per 10°C. We therefore selected enzymes from thermoacidophilic Clostridium species. Since our enzymes are more stable and longer active, we were able to further decrease enzyme costs for ethanol production. Fig 12: Selected Enzymes

Function Name Accession number Organism MW

Stoechio- metry

Exoglucanase (cellobiohydrolase) CelK CELK_CLOTM C. thermocellum 100,6 kDa 2 EC 3.2.1.91 ß-Glucosidase BglA BGLA_CLOTM C. thermocellum 51,48 kDa 2 EC 3.2.1.21 Alpha-L-arabinofuranosidase Araf51 Q4CJG5_CLOTM C. thermocellum 57,7 kDa 1 EC 3.1.2.55.

Xylanase, Feruloyl Esterase XynZ XYNZ_CLOTM C. thermocellum 92,26 kDa 1 EC 3.2.1.8

Shuffled enzyme ß-endo 3

Endoglucanase CelR Q70DK3_CLOTM C. thermocellum 82,051 kDa EC 3.2.1.4. Endoglucanase CelF GUNF_CLOTM C. thermocellum 82,089 kDa EC 3.2.1.4. Endoglucanase CelD GUN4_THEFU Thermomonospora fusca 95,203 kDa EC 3.2.1.4. Endoglucanase CelI GUNI_CLOTM C. thermocellum 97,797 kDa EC 3.2.1.4. Endoglucanase CelN Q9L3J5_CLOTM C. thermocellum 82,181 kDa EC 3.2.1.4.

Endoglucanase Cel9B Q50HR0_9CLOT Acetivibrio cellulolyticus 107,88 kDa EC 3.2.1.4.


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Cloning of chimeric enzymes: Unique Dockerin Domain from CelF of C. thermocellum: The dockerin was amplified from genomic DNA, while introducing appropriate restriction sites. We then inserted the Dockerin Domain into the linearized pET22b+ cloning vector which contained a signal sequence for secretion to create pETdoc. Vectors were amplified in E. coli and sequenced. Cloning of Cellulase Genes (size of cellulases: 40-180kDa): Cellulase genes were amplified from genomic DNA of various organisms using appropriate primer pairs designed to add restriction sites facilitating cloning procedures. Those primers were complementary to N- and C-Terminal regions of the gene of interest and additionally contained restriction sites compatible with our pETdoc cloning vector. The C-terminal primer was constructed in a way that the final PCR product missed its native dockerin domain, which was later substituted by the dockerin domain from C. thermocellum contained in pETdoc. Sequences were cut with appropriate restriction enzymes and ligated into pETdoc to generate plasmids pETendo (containing an endoglucanase gene), pETxynZ (containing the xylanase), pETCelK (containing the exoglucanase), etc...DNA was amplified in E .coli and isolated via minipreps for sequencing and further cloning.

Fig 13: Cloning of enzymes: Enzymes plus linker were cloned into pETdock already containing the dockerin domain from T. Thermocellum

4.2 Family shuffling of endoglucanases

4.2.1 Principle As described by Crameri et al, 1998, family shuffling is a directed evolution technique to accelerate the natural evolution process. It is based on “crossover” of homologous sequences and further selection and screening of recombinant clones for desired properties, e.g. higher activity or improved stability. A family of homologous parent genes is recombined randomly in vitro via PCR to yield a library of diverse sequences with new properties. Family shuffling has been proven to be more efficient for improving enzyme properties than directed evolution techniques based on a single template sequence and random point mutations (12). Since random mutations are generally deleterious of neutral, family shuffling offers the possibility to use preenriched functional sequences that have been selected against deleterious variants over billions of years of evolution. DNA shuffling consists of four steps: Preparation of genes to be shuffled, Fragmentation by Restriction enzymes, reassembly and recombination of the fragments by PCR by template switching and amplification of reassembled products by conventional PCR (13).

pETdock

Cloning of Enzymes

PCR to amplify C- terminal dockerin

Cloning into pET22b+

PCR to amplify enzymes + linker,

Cloning into pETdock to generate pETendo pETendo


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We selected the sequence of endoglucanase CelR from C. thermocellum as template for improving its activity via family shuffling because endonucleolytic cleavage of cellulose fibres is the primary critical step for cellulose degradation. Endoglucanases cleave cellulose fibres from the middle and generate the ends on which exoglucanases can attack and degrade cellulose processively. Cellulose degradation will therefore increase exponentially with the amount of accessible ends generated by endoglucanases. CelR is one of the major exoglucanases of the C. thermocellum cellulosome (14) and thus seemed to be an attractive candidate for improving enzyme activity and stability. On this template, we carried out a psiBLAST search to find other homologous endoglucanase genes from mostly thermoresistant or acidophilic organisms. The annotation of the identified sequences was verified. We thus obtained 6 homologous endoglucanases that were used for family shuffling (fig 12). Similar to Cel9R, two of the other selected endoglucanases of C. thermocellum, CelN and CelI, have an attached CBM3c module which has a thermostabilizing function (Zverlov and Schantz, 2005). CelF is also known to degrade 1,4-beta-glucosidic linkages in cellulose, lichenin and cereal ß-D-glucans. Additionally to C. thermocellum ß-1,4-endoglucanases, two sequences from more distant organisms were selected to increase the diversity of the shuffled enzyme library.

4.2.2 Cloning The homologous sequences were amplified from genomic DNA using the same primer pair and were modified to contain a unique dockerin domain as already described for the other native enzymes to obtain pETendo1, pETendo2, pETendo3, etc... After sequencing and amplification of pETendo vector DNA in E. coli, DNA was isolated and cut with restriction enzymes in order to excise the whole cellulase genes plus the recombinant dockerin domain. After a purification step, these fragments were used for family shuffling PCR.

4.2.3 Family shuffling PCR The Family shuffling PCR was adapted from a procedure described by Kikuchi et al. (1999), using multiple sets of restriction fragments (fig 14). The following precautions were taken: To avoid accumulation of point mutations, the DNA polymerase should be of high fidelity. Template sequences should be mixed in equal concentrations. Restriction enzymes should be different for each sequence, avoiding the formation of homo-duplex molecules that would reduce the overall recombination frequency. After the second PCR step, shuffled sequences were reinserted into pWB980 to generate shuffled pWBendo*1, pWBendo*2, pWBendo*3, etc... Shuffled sequences were finally transformed into B. subtilis, cells were plated on selective medium and random selection and sequencing of 10 clones was carried out to verify the quality of the recombinant library.


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Fig 14: Family shuffling and cloning of shuffled enzymes

4.3 Protein Expression and Purification

4.3.1 Expression system Since we wanted to obtain high expression levels of recombinant protein and high growth rates for fast biomass accumulation, we chose a bacterial expression system. Additionally our proteins to be expressed are prokaryotic and we do not need glycosylations that could affect the solubility and activity. Since Clostridia species need anaerobic conditions with biomass yields Ys< 0.05, the native system would be inefficient to produce enough proteins so we chose an aerobic organism. Because of its high growth rates and its capability to secrete large amounts of protein into the culture medium for easy purification, we selected B. subtilis as expression host for our recombinant proteins. B. subtilis has been used in industrial production processes for a long time and is a GRAS organism (Generally Regarded As Safe). In contrast to E. coli, proteins do not accumulate in the periplasmic space but can be directly secreted so that we do not need an additional step to lyse the cells. Several cellulosomal enzyme subunit genes have been successfully expressed in E. coli. However, they were partially degraded by E. coli proteases during the culture period (15). The choice of B. subtilis strain WB800 deficient in eight major proteases was therefore essential to avoid protein degradation. The B. subtilis expression and secretion system has been developed by Wong and colleagues (1991, 1995, 2002) and has already been used to secrete minicellulosomes from C. cellulovorans (15). B. subtilis expression vector pWB980 carries the strong and constitutively expressed P43 promoter, a kanamycin resistance marker and a sacB signal sequence that allowed the recombinant proteins to be secreted into the culture broth (Wong et al., 1989 and 15). Plasmid DNA was isolated from E. coli clones; inserts were excised and ligated into pWB980. B. subtilis recombinant clones were selected from kanamycin-containing agar plates and transferred into LB growth medium containing kanamycin.

Family shuffling

1. Excise 6 different enzymes together with dockerin

2. Digest 6 different Sequences with different Restriction enzymes mix

3. Recombinant PCR: heteroduplex formation, template switching. 2nd PCR to amplify shuffled sequences

pETendo

4. Reinsertion into pWB980 to generate pWBendo*

PWBendo* In 96 well plates:

Transformation Recombinant protein expression Selection of best performing

enzymes


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4.3.2 Screenings and selection Preselection of active clones: Replica plates were made to test endoglucanase activity with the CMC/ Congo Red staining method (16). 457 active clones were detected by the formation of halos and then transferred into liquid growth medium in a 96 well plate format. First screen for binding capacity and improved activity: We screened the 457 preselected clones from the shuffled enzyme library which had shown activity for most active endoglucanases still capable to be active when incorporated into the cellulosomal complexes. Replicas were grown for 1 day, cells were spun down and the supernatant, after addition of binding buffer (25mM sodium- acetic buffer pH6, 15mM CaCl2, ref 16), was mixed in a 9:1 stoechiometry (the enzymes must be in excess in order to occupy all nine enzyme binding sites) with the supernatant of an erlenmeyer culture of scaffoldin-expressing cells to form cellulosomes. These plates were then incubated for 20min at 60°C to select thermostable enzymes. Those artificial cellulosomes that contained only one type of shuffled enzyme were then retained and washed on 96well filter plates with a molecular weight cut-off MWCO=300K that were permeable for the single endoglucanases but not for the big cellulosome. The filter membrane with retained cellulosomes was then incubated with pNitroPhenyl-cellopentanose to monitor endoglucanase activity and OD395nm was measured after stopping the reaction. In this way, two highly active, pH-resistant and thermostable shuffled enzymes that were still active when bound to the cellulosome could be detected. Since shuffled endoglucanases that are no longer capable to build a cellulosome had been washed out, we knew whether the cellulosome could still form. The activity of the two selected shuffled enzymes at 60°C was twenty fold higher than the activity of their native ancestors used as control. Second screen for the best stoechiometric composition of the cellulosome for degradation of wheat straw and corn stover: In the 2nd screen we wanted to determine the optimal proportions of enzymes on the chimeric scaffoldin for degradation of biomasses wheat straw and corn stover. Enzymes were therefore mixed in different proportions, and scaffoldin was added. Depending on concentration of the different enzymes, the scaffoldin molecule should statistically incorporate each enzyme in a certain stoechiometry. Since the scaffoldin contains 9 potential enzyme binding sites, and we wanted each enzyme type to be present at least once, there remained 4 binding sites to be filled. This gave 2*5^4= 1250 possibilities to be screened. Substrate Preparation: To limit the number of samples to be screened, wheat straw and corn stover were mixed and milled together with the reaction buffer for the enzymatic assay. Preparation of enzymes: 1L Cultures of scaffoldin and the selected native enzymes (CelK, BglA, XynZ, Araf51) plus the 2 most active endoglucanases from the 1st screen were grown in erlenmeyer flasks. We obtained concentrations of 10g/l protein in the overnight grown cultures. After spinning down, the protein concentration in culture supernatants was determined using the Bradford method. Supernatants were concentrated to achieve same protein concentrations. Enzyme solutions were transferred into 96well plates and mixed using Biomek 2000 pipetting and diluting robot (Beckman). To achieve different stoechiometries, each well contained a different amount of each enzyme (fig 15).


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Scaffoldin was added, the solution was transferred into 300kDa MWCO filter plates for the complex to form. After washing, an enzymatic glucose test for biomass hydrolysis was applied as described by Berlin et al., 2005.

Fig 15 : Pipetting Scheme for 3 :2 :2 :1 :1 :1 stoechiometry Enzyme CelK BglA XynZ Araf51 Endo* Scaf Round 1 20µl 20µl 20µl 20µl 20µl Round 2 40µl 20µl 20µl 0µl 0µl Mix Round 3 20µl Transfer to filter plates Wash Apply substrate Incubate 60°C Stop reaction Read OD

4.4 Industrial Production Process

4.4.1 Principle The cellulosomal components will be produced separately in three stirred tank fermentors. Since proteins are secreted, we will eliminate cells via cross flow microfiltration and concentrate the protein solution via cross flow ultrafiltration. The concentrates will be stored until all six components have been produced. Protein concentrations will be determined and quality controls will be carried out. Our bioprocess is planned to imitate the natural assemblage of cellulosomes that occurs in the exterior of the cell, by random incorporation of enzymes into the scaffoldin. Therefore it is important to mix protein solutions in adequate proportions to obtain statistically a 3:2:2:1:1:1 (Endo*: CelK: BglA: XynZ: Araf) stoechiometry on the scaffoldin molecule. This will be done in a stirred Tank at 4°C in Binding Buffer (see above).

4.4.2 Small scale production Using shake flasks, we already defined optimal protein expression conditions. To optimize the cellulosome production process we used 1 L small scale reactor and test equipment set (1L, Sartorius) to define the MWCO for optimal Cross flow - Micro- and Ultrafiltration during the process.

4.4.3 Scale up The bioprocess for the production of cellulosomes can be divided into four parts. 1st step: Preculture of B. subtilis in Erlenmeyer flasks. 2nd step: Separate expression and secretion of the required scaffoldin and cellulase molecules in 100L stirred tank fermentors by B .subtilis (fig.16) grown on molasse/ SMH. The different proteins have to be produced time delayed so that an adequate amount of each protein is in stock when the assemblage of cellulosome is performed. According to the stoechiometry of the complex and protein yield, production of each component must be adjusted and we have to elaborate a time schedule for the fermentation series. Cells are separated by cross flow microfiltration (PESU microfiltration membrane, 0,1 µm) with recirculation of the retentate and washing to achieve maximal product recovery.


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The permeate will then contain primarily the heterologous protein, besides negligible amounts of other secreted proteins and be further concentrated by a cross flow ultrafiltration (MWCO 30, 50, 100kDa) to reduce the final volume. Finally the concentrated Cellulase and Scaffoldin solutions are filled into storage tanks. Sampling to determine total protein concentrations (enzymatic tests, Bradford), test the degree of purity and also to perform quality controls (contamination, activity etc.) will be done. Analysis of protein concentration is the precondition to calculate the correct volume of each enzyme solution for the following cellulosome formation. 3rd step: Proportional mixing and assembly of cellulases and scaffoldin in a stirred tank to permit the assemblage of cellulosomes in a predefined stoechiometry (fig.17). This assemblage requires an adequate proportion of all enzyme solutions. Valves are used as dosage system to add the determined volume of concentrated protein solution. First enzymes are well mixed before the scaffoldin solution is added. The solution is then stirred together with binding buffer at 4°C for 4 hours for complex formation to occur. 4th step: Purification of the product. The purification is based on washing and cross flow ultrafiltration with a relative high MWCO (300 kDa), which retains the big 894kDa cellulosome molecules and eliminates all smaller molecules like scaffoldin, enzymes and additional secreted proteins. A recirculation of the retentate ensures to obtain a highly pure and concentrated cellulosome solution (100g/L) which can be sold. According to our calculations, we will be able to produce about 4-5kg of pure cellulosomes per week. Fig 16: Production of scaffoldin and enzymes in stirred tank reactors. Separation and concentration using Cross Flow filtration.

Fig 17: Assembly of the cellulosome macromolecular complex in a stirred tank, washing and concentration.

Waste:

cells

Extracellular expression of each component in 100 L batch fermentor

(10 g/l)

Cell separation with microfiltration

Protein concentration with ultrafiltration

Concentrated protein solution ( 120 g/l )

waste: liquid & all proteins smaller than concentrated protein

Cellulosome!

waste:

liquid, all unbound cellulases

& other secreted proteins

Cellulosome!

waste:

liquid, all unbound cellulases

& other secreted proteins

SCAFFSCAFF

CelK

BglA

Araf

XynZ

Endo*

CelKCelK

BglA

Araf

XynZ

Endo*

binding bufferbinding buffer


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5 The company’s strategy

5.1 Exploitation calendar

2004 2005 2006 2007 2008 2009 2010

legal creation of Cellulozymesteps patent

development development of our own cellulosome R&D studies for development of new productsof the project production study

beginning of the productioncommercialization

Investments 120 000 € 260 000 €need of 612000 euros

POINT MORT 2012

Localization Laboratories SEMIA Incubator Plant in Schirmek

human Dr Maetz, Dr Feil: R&D proof of conceptresources Ing. Schulz: production

Mrs Coutel and Schlegel: company managementtechnician(s)


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Different steps during the proof of concept: R&D realized during 2004:

• Construction of the scaffoldin plasmid with 9 cohesin domains made by Dr Maetz • Family shuffling for the improvement of the endoglucanase Cel9R by Dr Feil :

Generation of the different clones and first screening on agar plates containing cellulose. Choice and cloning of the best native cellulases by Dr Feil. This part of the work was financed by Connectus.

R&D realized during 2005 (team composed of Drs Maetz and Feil located in the SEMIA Business Incubator in Illkirch-Graffenstaden since July 2005)

• 2 screenings on the platform of the faculty of pharmacy • activity tests of our cellulosome

R&D realized during 2006 : • design of the general production process by Dipl Ing Schulze • optimization of culture conditions in Erlenmeyer flasks and fermentors of 1L

5.2 General strategy

Product Placement: Since our biomass suppliers are manifold and since more and more cellulosic bioethanol- producing plants are emerging, we estimate the global enzyme market to be quite open for new companies to be established. Actually, there are only few big companies selling enzymes for cellulosic bioethanol production. But since our product will be more economic and since in 2010, new emerging pilot plants will be keen to test alternative smaller enzyme suppliers to circumvent the prize monopole of Genencor and Novozymes, we will have a large demand for our improved enzymes. With regard to our production capacity, we are planning to deliver our product in small amounts to newly emerging pilot facilities which hopefully will reorder larger amounts or make an stock purchase agreement with us to enable us buy bigger production equipment. Marketing strategy : CropsBreaker is sold in plastic bottle of 1L containing a 100g/l highly concentrated solution of cellulosomes which will be commercialized on our web site www.astrosurf.com/astrodonon/ . In order to make customers aware of our product, Mrs Schlegel will directly contact ethanol producers to promote our product. She will present our product CropsBreaker to each ethanol producer that wants to develop a cellulose-to-ethanol pilot plant. Potential alternative strategy: As we have patented the use of cellulosomes to hydrolyse (hemi)cellulose into sugar, we can sell our product to another industrial area which utilizes cellulase enzymes. With some enzyme type modifications, we will be able to sell our cellulosome to the textile industry (cotton softening) , to the feed industry (to improve the digestibility of food by animals) and/or to the detergent industry. Always with the same synergy quality, the cellulosome will be 20-fold more efficient as the single cellulase enzyme actually available. Our competitors will remain the same but in another market. Besides the selling of the whole multienzyme complex cellulosome, we have the opportunity to sell the improved enzyme endoglucanase Endo* individually.


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Potential development strategy: We will probably re-open the R&D department in 2009. For the moment, we have thought either:

• to create novel cellulosomes for other biomasses like bagasse or wood and/or for other markets like cattles’ feed, textiles...

• to develop a novel strain of bacteria that can hydrolyse and ferment at the same time.

5.3 Material needs The production facility (500 m2 and offices) of the company has been provided by a relative from Dr Maetz for a small rent. During the first phase of our development, in the SEMIA Business Incubator at Illkirch-Graffenstaden, we bought some basic devices of molecular biology work and a fermentor of 1L. Some material was already present in the Business Incubator. For the following phase of production and commercialisation, we have to buy materials for about 600.000 euros (3 fermentors of 100L, assembly reactor and cross-flow membrane filtration modules...).

5.4 Human Resources Dr Maetz, Dr Feil, Dr Schlegel and Dipl. Ing Schulze are active members of Cellulozyme. Mrs Coutel kindly helps us with the administrative and financial tasks from time to time. We intend to employ her by 2011. We also intend to employ technicians to help us with the production as soon as we have bigger orders. We will also take trainees from the ESBS to work assiduously in our R&D laboratory or production department.

5.5 Legal aspect

5.5.1 Cellulozyme: the Company Cellulozyme has been created on 20/08/2006, as an S.A.S. with five co-founders. All the members contributed 15000 euros. Domiciliation :

Cellulozyme 21 route de Steinbach 67 130 Russ – France Tél : +33 (0)3 88 97 01 73 Internet : www.astrosurf.com/astrodonon/ e-mail : [email protected]

S.A.S. with a capital of 75 000 € SIRET 156 842 965 00018 – Code APE 731Z


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RCS Strasbourg N° B406895046 - N° intracommunautaire FR19156842965 Banque Société génerale Grand’Rue, Strasbourg Fonders : Kathrin Feil, Chloé Maetz, Anne Schlegel, Ines Schulze, Claire Coutel with a financial contribution of 15 000 € each. The president is Chloé Maetz.

5.5.2 Patent and Registered Trademark The patent N° WO0689427 about artificial cellulosomes and their use at industrial scale has been deposed on January 8th, 2006. Since our main competitors are big international companies, we have protected our technology in Europe as well as in the U.S.A. Our advances in research before the patenting were protected with good laboratory notebook and some enveloppe soleau. We have internationally protected the names Cellulozyme and CropsBreaker as registered trademarks. 6 Financial aspects

6.1 Before the creation of the company Cellulozyme has been created officially in 2006. However, the cellulosome project existed since 2003. While still being employed in public research and with agreement of their supervisors, Dr Feil and Dr Maetz could make use of the laboratory equipment with the promise to give a little part of future benefits to each of the two public research laboratories. Making good advancements in their research, UMR700 physiopathology applicated for a Connectus grant and received 120000 euros. Connectus is a group which supports public research groups wanting to develop an innovative project in Alsace with financial help. Cellulozyme has to refund the received money when it starts making profit. In July 2005, Dr Feil and Dr Maetz leaved their laboratory and went to work in SEMIA-Business Incubator, located in Illkirch-Graffenstaden (Alsace-France). Funds came from several grants of Alsace, Europe and ADEME (Agence De l'Environnement et de la Maitrise de l'Energie). Some resources also came from personal funds and from OSEO-Aide au projet innovant (help for innovative project). Expendings Receipts Salaries 43 884€ Grant ADEME 10 000€ Rental SEMIA 63 50€ Grant Alsace 20 000€ R&D charges 200 340€ Grant Europa 10 000€

Grant OSEO 100 000€ Personnal funds 110 000€


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6.2 Cellulozyme finances Economical status of Cellulozyme Cellulozyme has been created in August 2006. Dr Feil, Dr Maetz, Dipl Ing Schulze, Mrs Schlegel and Mrs Coutel supplied each 15000€ into common equity. In June 2006, Cellulozyme won the « Concours d'aide à la Création d'entreprise innovante » organised by the Ministère de la Recherche-France, a prize endowed with 450000€ in Cellulozyme capital. In the first year of its creation, Cellulozyme benefits from a grant from Alsace (15000€) and Europe (20000€). Cellulozyme has the status of « Jeune entreprise innovante » (young innovative company). This means that Cellulozyme does not have to pay neither turnover nor corporation tax during its first years of activity. Cellulozyme has an agreement with the city of Schirmeck. It doesn't have to pay any professional taxes and has a weak habitation tax. Investements of Cellulozyme In 2007, we will build the plant in Schirmek. In order to start cellulosomes production, we will have to make several investments, almost 1.097.000€ in total.

Building renovation 500000€Production equipment 572000€Quality-control and R&D equipment 25000€

Our start capital, grants included, is 485000€. For the complete production and research facility, we need additional 612000€. This sum shall be contributed by private investors and bank loans. In 2011, in order to buy new equipment for enlarging our production capacity and make Cellulozyme competitive, we will need a new round of financial support from private investors and a new loan will be asked. It is also planned to employ Mrs Coutel. Profits We will sell Crops Breaker for 500€/kg. We will produce 1kg/day. This price has been fixed in order to stay competitive in the market and make net profit in the near future. Cellulozyme will have net earnings in 2012. In the annexe there can be found income statement and balance sheet from 2007 to 2012. In the balance sheet, we have not taken into account the sales of additional products planned to be developed because we don’t know when we will start the R&D department.

Investissments

1 097 000€

Capital + Grants

485 000€

Loans + private investors

612 000€Investissments

1 097 000€

Capital + Grants

485 000€

Loans + private investors

612 000€

Profits of Cellulozyme

-300000

-250000

-200000

-150000

-100000-50000

050000

100000

150000

200000

2007 2008 2009 2010 2011 2012 2013Profits in Ū


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7 SWOT analysis Strength Weakness

• Our product is 20 times more efficient than cellulases of our competitors

• Purified enzymes, therefore less storage costs for ethanol producers

• No need for expensive pretreatment of the biomass therefore cost reduction for ethanol producers

• Highly competent and motivated team

• Limited production capacity at the beginning

• For the moment, same production cost for ethanol producers but intend to be cheaper when more enzymes produced

• Product optimized only for straw and corn stover

• Complex production process Opportunity Threat

• EU quota : 5,75% bioethanol in 2010 and 20% in 2020

• Only two cellulase producers versus increasing number of biomass-to-ethanol producers

• Market can be enlarged to other industries (e.g. feed, textile, ...)

• Our competitors are big biotech companies that have a lot of resources

• Decrease of petrol’s price • Competitors can develop other more

efficient cellulases than ours

Documents

Business plan Cellulozyme - Astrosurf · For example in France the TIPP ... from sugar cane and from cellulosic feedstock. ... Business plan Cellulozyme 5 Collection of