CRISPR is one of the most exciting areas in biotech. Investors, from VCs to the Defense Department, are pouring billions into CRISPR and CRISPR-like technology startups in an effort to capitalize on the many applications of gene editing.

One such startup, Inscripta, has raised almost $100mm over multiple rounds of financing before it has fully launched its first product. Why would VC's continue to fund such a venture? The team and the leader, of course, but also the potential of making gene-editing technology readily available to the therapeutic, energy, food, agriculture and life sciences industries.

So far, this life-altering technology has mostly been hoarded by its creators behind licensing fees designed to sell the rights to the highest bidder, giving them a monopoly of the technology in a given vertical. Inscripta's approach is a welcome alternative and one that has huge potential.

To get around the licensing issues of a prominent CRISPR gene-editing technique, Cas9, Inscripta created its own gene-editing protocol using novel CRISPR enzymes called MADzymes. By utilizing MADzymes, Inscripta can deliver new DNA sequences to targeted cells in microbes, plants, animals and humans. As more MADzymes are discovered, more types of cells within these organisms can be subject to gene-editing. I recently had a chance to sit down with Inscripta CEO Kevin Ness.

Q: What made you decide to give away your IP for free to these researchers and scientists?


Gene editing can do an enormous amount for our society. We think it's probably one of the most exciting breakthroughs that's really happened in this young century.

But to really deliver on all that value, more research needs to be done. You have a technology with so much potential to benefit humanity and a myriad of players are standing on the sidelines with good ideas because they can't get access to these gene-editing enzymes. That's a big problem. People couldn't get access to these molecular scissors, so we decided to give them access.

Now they can start to do unencumbered research for free. And it's truly free. All academic and commercial people can start using this. They'll be owners of their own research.

Q: How hard was it to create your own CRISPR-like enzyme?


From the inception of the company, we made a commitment to build up a large enzyme engineering effort so that we can always ensure we have the best possible performance in our products. We came across this one enzyme - we haven't yet talked about any others, but you can imagine - and we released this one from an early family of enzymes called the MADzymes. Later, when we launch our product offering of full genome editing solutions (instruments, software and reagents), there'll be a bigger market to move into with additional MADzymes that our community can use.

Q: You're really giving this away for free?


Yes. If you use it to make something unique, you own that. That's yours. We kept three caveats:

  1. If you take our hard-fought CRISPR enzyme and just resell it, like a distributor, there'll be a small, single digit royalty
  2. If you use the actual MADzyme in a therapeutic solution
  3.  if you use the actual MADzyme in a reoccurring manufacturing process

The long-term value is ultimately in Inscripta's full suite of gene editing tools. The current MADzymes are just the start for Inscripta. You can think of it in three fronts. First, there's continuing to release MADzymes into the marketplace. Second, we have a bespoke enzyme engineering program, where people are coming to us with high-value applications and very specific traits and attributes that are needed. We'll use our enzyme engineering program to make them an enzyme that's specific to their application.

Finally, we're building a full suite of gene editing tools. CRISPR has so many applications. So we're not going after a particular application. We're going to enable our customers to create their own applications quicker by giving them better tools.

For example, back in the gold rush, a lot of people were trying to find gold to make money.  But you know who ended up making a lot more money than the average miner? It was the guys who sold pickaxes, tools and supplies to everyone. That's really the business model of what we're doing. We released the MAD7 enzyme to enable more gold miners.

Q: What would you say the timeline is for someone to use your tools, find results and potentially be ready to move into a kind of commercialization process? Could that happen in a few months of time?


Yes, it could, and I think it speaks again to why this CRISPR-like technology is so important for society. Once you have a highly functional gene editing system, there are a lot of uses you can apply it to immediately.

Q: So your gold miners, these could be VC-backed biotech startups, or are these university researchers that are looking into things part-time? How would you describe who your customer is?


It's a pretty diverse set. There are many startups using gene editing to go after a particular application. But we're hearing from a lot of VCs who have good ideas being pitched to them that they're not funding because of the lack of access and high cost to CRISPR gene-editing enzymes. The entrepreneurs can't get access to the tools they need to do the work and thus cannot create a viable business.

We're also hearing from the small players who believe that if they move into the gene editing space, they'd be able to achieve their application faster, but are not using the technology yet. Then it goes all the way up to the medium and really large players - $100 million type programs where there are multi-year investments that these big strategics want to be making. But they've been standing on the sidelines and don't want to get into the CRISPR space because of licensing issues.

Another segment is biofoundries. They work with customers to build new applications, but their customers have been saying, "you can't use CRISPR in the build, because the downstream licensing is too expensive."

Finally, the largest subset is the researchers in academia who are studying fundamental biology. So not only people using gene editing for product development but also people who are doing basic academic research.

Those are the major customer segments. Academics, biologists, people who work with cells, pharma, and the bio-industrials that are using strain engineering to produce particular compounds.

Q: So let's say I use your tools, I use the MADzymes, I test it out and I think I have a solution here. I'm onto something. What next? If I'm a life science academic, and there's a few of us doing this, do we need to find financing, do we need to find a larger pharma to sponsor us for clinical trials?


It's all over the map, depending on the application. If they find something of economic value, that they wanted to begin to fund a company around, then they would either go to a VC or an existing player in pharma, energy, food or agriculture to initiate the funding in a particular direction.

Q: So it sounds like the fundraising landscape is pretty fragmented. Do you plan to address that as well?


I believe our sole job is to continue to make sure that we deliver the best pickaxes to customers that they're using, and as the field grows, there'll be a wide variety of mining types. Not to milk the Gold Rush analogy too much, but there will be the mom-and-pop shops that just want a pickaxe, and there will start to be these huge goldmines that need excavators.

From our perch, we're going to be hearing what type of tools they specifically need, and our company road map will make sure that we're always delivering the best tools to the target customers. We won't be able to build everything, but we are setting up an elite product development pipeline that can output a whole different set of tool types to enable customers not just to get to an answer faster, but to also get to a better answer. They can now ask questions and do experiments that they could never even contemplate before. With that capability will come entirely new opportunities in biotechnology.

And there are substantial needs. Biologists do not have good tools to engineer living cells. They don't have good tools to really measure living systems, relative to other industries. There's a big deficit in tool quality that this field has.

Q: How long do you think until some of the companies that have licensed the actual CRISPR tech come and sign up for Inscripta?

Kevin: I already see them on our website.