© 2013 Modular Genetics, Inc.

Synthetic Biology Enables

Sustainable Surfactant

Production

July 2015

© 2013 Modular Genetics, Inc.

Synthetic Biology at Modular Genetics

© 2013 Modular Genetics, Inc.

Foaming agents—they suspend gas in a liquid (Bubbles!)

Emulsifiers—they suspend an immiscible liquid in a liquid

Dispersants—the suspend a solid in water

What are surfactants?

•The surfactant market was $25 billion in 2009

•Annual global production of 13 million metric tons

© 2013 Modular Genetics, Inc.

The Surfactant Market

5%

Surfactant market was $25 billion in 2009

Annual global production of 13 million metric tons

3%

4%

7%

3%

7% 7%

15%

5%

44%

Textile

Food

Agrochemical

Coatings

Oilfield

OtherHome, Institutional

& Industrial cleaning

Personal Care

Fabric Softeners

Detergents

© 2013 Modular Genetics, Inc.

Surfactant Manufacturing Today

Oily Chain

Polar or charged group

• Petroleum

• Palm oil

Polar

Chemical Processes

Surfactants

The raw materials are not renewable

Chemical processes are hazardous (ethoxylation, chlorination)

Certain surfactants are environmental toxins (e.g., alkylphenol ethoxylates)

Contaminated with carcinogen (e.g., 1,4 dioxane, nitrosoureas)

© 2013 Modular Genetics, Inc.

Future of Surfactant Manufacturing

Oily Chain

Polar or charged group

• Synthesized by

Bacillus subtilis from

cellulosic sugarPolar

Chemical Processes

Surfactants

The raw materials are renewable—cellulosic sugar

No Chemical processes are used—fermentation only

Biodegradable composed of fatty acids and amino acids or amino alcohols

Potential for contamination with carcinogens eliminated (e.g., 1,4 dioxane, nitrosoureas)

© 2013 Modular Genetics, Inc.

ethanolamine

-CarboxyglutamateLanothionine Dehydroalanine

Modular Surfactant Generation Capability

Over 300 “nonstandard”

amino acids

20 standard amino

acids

Fatty acid+ X

X

amino alcohols

H2NOH

© 2013 Modular Genetics, Inc.

CH3(CH2)9-12

OH O

O

O

OH

NH

OH

Fatty acid + Glutamic acid

Glu

Fatty acid+Glycine

Gly

CH3(CH2)9-12

OH O

O

O

OH

NH

OH

H

Fermentation-Derived Acyl Amino Acid Surfactants

-

-

-

© 2013 Modular Genetics, Inc.

Key Product: Surfactant – Personal Care

Targets the personal care market:– shampoos, hand wash, body

wash, shave cream etc

Favorable production economics– Low cost renewable feedstocks– “Green” purification process

Favorable “switching” characteristics enable fast adoption

Superior product at comparable price

Strong product concept from marketing perspective

Proprietary “designed” product

Clear in solution

Odor-free

Excellent foam without need for secondary surfactant

Superior product characteristics vs. segment leader

– 3 times more water soluble– 10 fold lower CMC

Very mild, nice after feel, non-tearing, hypoallergenic, non-comedogenic, protein-free

Target Market and Value Proposition Differentiation

© 2013 Modular Genetics, Inc.

Strain Engineering Controls Fatty Acid Length

1.6%

16.2%

55.0%

25.9%

1.2% 0.1%

344=C12

358=C13

372=C14

386=C15

400=C16

414=C17

1.7% 0.3%

94.5%

0.8% 2.7%

344=C12

358=C13

372=C14

386=C15

400=C16

414=C17

Standard FA-Glu Production Strain New Engineered FA-Glu Production Strain

55% C-1416% C-1326% C-15

95% C-14

© 2013 Modular Genetics, Inc.

Unilever

Modular Genetics Demonstrates Production of Bio-Derived

Glycinate, an Ultra-MildSurfactant

Dr. K.P. Ananthapadmanabhan, Sr.Principal Research Scientist at Unilever,offers this perspective:

“Modular's approach of using engineered

microorganisms to convert underutilized

agricultural material into useful chemical

products through microbial fermentation

has enormous potential in addressing our

future needs. Use of Glycinate

synthesized by microbial fermentation

represents a significant advance

towards our sustainability goals.”

New

Dove® Sensitive

Skin Body Wash

Our Mildest

Formula Ever —

Now With

Glycinate

$4 billion dollars today.http://www.prophet.com/blog/aakeronbrands/13

8-dove

© 2013 Modular Genetics, Inc.

Henkel

“We find

Modular’s

surfactants

have a level of

performance,

and a level of

purity,

consistent with

their use in

commercial

formulations,“

said Pete He,

Senior

Research

Fellow, Henkel

Consumer

Goods.