Biotech in Flavors and Fragrance:
The Next Leap Forward?
01
Creative
Breakthroughs
Throughout the history of perfumery (and broader fragrance and flavor creation),
in fragrance and flavor have been driven
meant consumer availability of perfume was severely limited. An all natural palette
by chemistry’s technical evolution.
the critical motor of progress has been advancement in synthetic chemistry.
Where the fragrance industry prior to the mid-19th century exclusively used plant
and animal derived ingredients, the effort and expense of natural ingredients
also meant that the variety of effects perfumers could achieve were narrow. The
introduction in the mid-19th century of natural isolates and synthetically produced
aromachemicals revolutionized the perfume industry. Where extracts from plants
and in some cases animal byproducts (musk, civet, ambergris) present amazing
beauty and qualitative richness, their available supply is challenging and at times
inconsistent. When mid-19th century chemists were able to identify the odor
producing molecules in various widely used naturals and then successfully isolate
and produce these through industrial synthesis, modern perfumery was born. The
introduction of new classes of technical ingredients such as coumarin (found in
tonka), vanillin (impact component of cured vanilla bean), ionones (violet-woody
in character), γ-undecalactone (peach and stone fruit note) and beyond were
paradigm shifting advances that gave perfumers three things: 1. consistency of
supply not subject to agro-commodity pressures; 2. predictability of cost; and
3. new ranges of effects that lasted longer and could perform in different product
forms. Modern perfumery as we know it was therefore born when exquisite and
costly natural ingredients were supplemented with synthetic ingredients and
“designer molecules” that allowed more varied and precise effects, were easier to
produce, and were more durable across various product forms.
02
Industry
Background
The modern fragrance and flavor industry is around a $24 billion industry and
consists of firms referred to as fragrance and flavor “houses,” (“F&F Houses”)
whose comparative advantage is the creation and manufacture at scale of scents
and tastes using a palette of over 9,000 ingredients. It is a moderately concentrated
industry in that the top 11 companies dominate 80% of the market. F&F Houses
employ creative perfumer and flavorist teams who develop scents and tastes that
provide the sensory component of consumer products. Their clients are globally
recognizable brands that consumers know and love, and whose products line
the perfume and beauty counters, household product aisles, and grocery stores
the world over. F&F Houses earn revenue by supplying these tastes and smells
in solution or concentrated oil form to their clients, the product manufacturers,
who then bottle or incorporate the odor or flavor into their product’s final formula,
package the product, and distribute it through retail partners.
This Article gives general background on the fragrance and flavor industry and introduces areas of potential opportunity
for industrial biotech platforms. Please contact [email protected] with any inquiries or permissions for reuse.
03
The Modern
Palette
The day to day business of an F&F House involves true creative breakthroughs on
What do perfumers and flavorists use?
from bulk commodities like ethyl alcohol to exotic natural products such as ylang
the part of perfumery and flavor teams, but also impressive feats of procurement
and supply chain management required to keep a very large inventory of ingredients
on hand. Close to 9,000 ingredients of natural and synthetic origin are required—
ylang floral essence (just one among thousands of niche ingredient examples).
Many of the natural products such as spices, wood resins, and various floral
extracts are sourced from the tropical belts and other geographically remote
places. Distance, political instability, weather fluctuations, and trade conditions
may all impact availability. As a result, companies are under pressure to simplify
the creative palette toward fewer, higher performing ingredients, while also
maintaining cost and quality parameters, and balancing all with the need to keep
the palette fresh with new notes and effects for perfumers and flavorists to use in
novel sensations.
What do perfumers and flavorists use?
Specialties 65%
Vanillin, Hedione, Terpentines, Ketones
Synthetics
49%
>3000 Products
Commodities 35%
Ethanol, Dpg, Citric Acid, Colorants
1,000 Products
Specialties 32%
Patchouli, Rose, Ylang Ylang
Naturals
51%
>3000 Products
Commodities 68%
Citrus, Mint, Dairy, Vanilla
>3000 Products
Perfumers and flavorists use a variety of ingredients, generally broken down
between “natural” and “synthetic” ingredients.
This Article gives general background on the fragrance and flavor industry and introduces areas of potential opportunity
for industrial biotech platforms. Please contact [email protected] with any inquiries or permissions for reuse.
04
Global Trends
Current market dynamics in fragrance and flavor are impacted by both regional
An industry that touches billions.
between nations, ethnicities, climates and regions. Global macro trends that affect
and global trends. Scents and tastes are culturally specific and vary widely
all industries, such as emerging market consumer growth and increased pressure
on resources, also affect the F&F Industry. Below we look briefly at some drivers in
fine fragrance:
Mature markets such as North America and Europe have seen relatively flat
growth over the last two years, with a major issue being commoditization or
lack of differentiation between products. Traditional consumers are saturated
and experiencing some category fatigue, while younger users are also
consuming less than previous generations or are at risk of abandoning the
category. In addition, consumers are receiving fragrance from body and bath
products, instead of relying solely on perfume.
In markets such as India, China, and Brazil there is surging demand for
fragranced products of all forms, driven mainly by the arrival of new middle
class consumers who are able to purchase fragranced products for the first
time. Much of the growth is concentrated in locally available mass brands
of lower price point, however higher priced Western designer fragrance brands
are important aspirational touch points. This growth in both fine fragrance and
scented consumer products (including laundry and body care) puts stress
on supply chains for the raw materials that go into fragrances, beauty products,
and cosmetics generally. The procurement pressure, need for reliable supply
and high performing ingredients comes back into focus.
Cost of natural fragrance raw materials are impacted by the global cost
increases for labor, especially in the agricultural sector in developing
economies. In some cases, crop supply is critically constrained by lack of
available labor force to harvest and process it.
Decreasing synthetic chemistry costs have helped ease some of the pressures
on supply. Petrochemicals are a major feedstock for a large number of
aromachemicals, and the industry has benefited from favorable petrol prices.
In addition, firms in India and China are building out capacity for chronically
undersupplied key aromachemicals, and in the process pushing down prices.
The fragrance industry is self-regulated, and F&F Houses adhere to rigorous
internal guidelines that align with governmental executive bodies concerned
with consumer & environmental safety. Ingredient usage limitations are passed
from time to time based on sensitization, toxicology and allergen risks. This
means that key widely used ingredients might be limited or removed from
perfumer use altogether, which presents an obvious challenge for product
consistency and creation. In order to keep existing products recognizable
This Article gives general background on the fragrance and flavor industry and introduces areas of potential opportunity
for industrial biotech platforms. Please contact [email protected] with any inquiries or permissions for reuse.
(when certain important ingredients are restricted) and to keep the creative
palate viable, the search is always on for replacers or alternatives to newly
restricted ingredients. At F&F Houses, R&D and perfumery resources are
intensively focused on responding and complying with new regulations.
05
Opportunities
For Bio-Derived
Ingredients:
How can cultured ingredients serve the
fragrance and flavor industry?
New manufacturing platforms using bioengineered organisms to produce valuable
aromachemicals and natural mixtures can contribute a great deal to the F&F
industry. Industrial biotech can support F&F Houses in two broad ways: mitigating
the price and supply challenges around widely used ingredients, and making
certain novel ingredients or restricted ingredients possible to use at scale, thereby
driving creation, novelty, and performance.
Fermentation techniques using either wild type or bred microbes, as well as
enzyme enhanced reactions off of natural feedstocks, have been used by the
industry for decades. New approaches using such cultured ingredients, including
those made possible by synthetic biology, have the promise of much greater
optimization and more specific targeting of ingredients. While the early focus has
been on “drop-in” replacements for widely used ingredients—either single molecule
aromachemicals or mixtures—the future can be broader.
Drop-Ins: Looking for cost efficient biologically produced “drop-in” replacers
for synthesized aromachemicals is straightforward—if microbes can ferment
a single molecule aromachemical at a cheaper per kilogram price than industrial
chemistry can synthesize it, the value proposition is obvious. This of course
requires that the organoleptic properties of the bio-derived material remains
identical to the current grade, which is not to be taken for granted, even where
the molecules are chemically identical. Process impurities even in trace amounts
can have unexpected impact. But since there are thousands of aromachemicals
in use, industrial biotech firms have a variety of products and chemistries to
experiment with to find where microbial routes are advantaged. There are
numerous ingredients priced above the $200/kilo level that would be more
widely used by perfumers if those prices dropped. Making costly ingredients
available to consumer product perfumers, who typically work with a much lower
budget than fine fragrance perfumers, would itself be a major advance for the
industry.
Supporting natural ingredients: In addition to single molecule aromachemicals,
microbes are capable of producing complex mixtures that are analogous to
plant or botanical extracts or essential oils. With patient improvement at the
qualitative level, microbes may one day be able to produce a natural oil that
has comparable properties to a plant derived ingredient. Projects are under
development, with some already in-market, including Firmenich’s patchouli-
This Article gives general background on the fragrance and flavor industry and introduces areas of potential opportunity
for industrial biotech platforms. Please contact [email protected] with any inquiries or permissions for reuse.
analogue product, Clearwood™, developed with Amyris, and Gingko
Bioworks’ project with Robertet to create a cultured rose. Such developments
will supplement fragile natural supply chains and improve the sustainability
of the industry by reducing the amount of resources—from pesticides and
fertilizers, to water, fuel and other inputs—required for these natural products.
They will also support demand for the natural note by sustaining supply stability
even through cyclical downturns in crop production, when perfumers typically
have had to stop buying a crop or using a note due to its volatility.
Other possibilities include the following:
1. Biologically produced mixtures based on essential oils from plants that are
impossible to cultivate or extract such as lily of the valley, hyacinth, orchids,
tropical flowers, etc.
2. Newly discovered biological captives with unique smell properties that are yet
to be identified because traditional chemistry can’t synthesize or cost-effectively
scale them.
3. Bio-derived variations of restricted ingredients which would be tuned to
reduce sensitizers and eliminate toxicity, thereby returning them to the palette.
06
A Leap
Forward?
Overall, the F&F industry has much to gain from new developments in
bioengineering, in the same way that it benefited (and continues to benefit)
from evolutions in synthetic chemistry. As to the question of whether microbially
produced “cultured ingredients” can ever replace grown in the ground natural
products, at this time it seems unlikely. This question recalls what was asked more
than a hundred years ago when aromachemicals first came into production—would
the new synthetics replace naturals? In fact the opposite occurred: demand for
naturals increased exponentially with the broader availability and better quality
of scented consumer products that industrial synthesis made possible. The new
creative effects and stability achieved through marrying nature with chemistry
brought perfumery its first golden age in the late 19th and early 20th centuries. With
the great promise of bio-derived ingredients, it seems possible to expect some of
the same beneficial development and creative evolution—or perhaps even a new
golden age.
This Article gives general background on the fragrance and flavor industry and introduces areas of potential opportunity
for industrial biotech platforms. Please contact [email protected] with any inquiries or permissions for reuse.