Five Big Ideas Shaping the Biorevolution

From DNA computing to augmented wood, these are the biotech trends you need to have on your radar

HSBC x Wired Consulting | Frontiers Biotech | DNA Storage 2

A little over a decade ago, Steve Jobs made a prediction. “The biggest innovations of the twenty-first century will be at the intersection of biology and technology,” he said. “A new era is beginning.”

It proved to be remarkably prescient. In 2012, a year after his death, a patent would be filed for a novel gene-editing technique known as CRISPR that would make it possible to rewrite genetic code inexpensively and accurately. It lit a rocket under the field.

A “word processor” for nature, in that it enables the deletion or insertion of specific pieces of DNA with unrivaled precision, CRISPR was to become just one of a cluster of innovations that are continuing to define a new, momentous chapter for biotech. And this biorevolution is impacting myriad sectors, from healthcare to agriculture to energy and beyond.

“There are many examples of things which have evolved in nature that are now finding application in the modern world, not just in medicine but other sectors too,” says Kevin Lyne-Smith, Global Head of Equities, at HSBC Global Private Banking and Wealth. “It’s hard to draw a conclusion on where it will end, but it’s already got the characteristics of the early stages of the digital revolution.”

The idea of exploiting nature for goods and services is nothing new. Ancient people used yeast to make bread and beer; in the twentieth century biology has given us penicillin antibiotics and enzymatic laundry detergent. But the practice entered its modern era in the 1970s, with the advent of genetic engineering and the establishment of the first biotech companies. This brought together science and business like never before, and the influx of capital galvanized research and development efforts.

Over the three decades that followed, the field was accelerated by breakthrough devices such as DNA sequencers and synthesizers, and biology itself slowly morphed into a computational, data-driven discipline. Following the turn of the millennium, as researchers successfully charted ever greater regions of the human genome, and the cost of sequencing that genome rapidly declined—from around $100 million in 2001 to approximately $200 today—the potential of biotech to transform our lives has become electrifyingly apparent.

Over the past few years, the possibilities unlocked by biotech advances—from treating genetic diseases to de-extincting animal species—have been enlarged by progress in complementary fields such as artificial intelligence. This has underpinned a coming-of-age moment in this space. And while genomics has defined the inflection points of the biorevolution, its scope goes well beyond. Contemporary bioengineering also encompasses emergent domains including biomaterials, biointerfaces, and biocomputing.

The sector has duly become highly investable. Biotech companies now populate stock market indices, and there is a thriving tier of startups with the demeanor of polished Silicon Valley businesses.

The Covid-19 pandemic only thrust the sector further into the limelight. “From a priority perspective, we all realized how precious our health is, so we’re more willing to invest in it and there’s more attention on it,” says Willem Sels, Global Chief Investment Officer at HSBC Global Private Banking and Wealth. “That makes social sense, because people care more about it, and it often makes economic sense too, because you can offer that service at the best possible cost.” Biotech is now front-of-mind for larger economies such as the US and China. Indeed, HSBC believes that the market for products using CRISPR technology alone could be worth $7 billion by 2030.

“For investors, there are huge opportunities for gain not only in the public space, but also the private space, where there is higher risk but higher rewards,” says Sels. “Diversification and specialist knowledge or expert advice is key to charting your way through this sector.”

This edition of Frontiers explores the verge of this brave new world, shining a light on five cutting-edge trends. All of them are enjoying serious venture capital flows and are attracting attention from credible experts. For each story, we’ve interviewed one such specialist to hear why they’re excited, but also what challenges still need to be solved.

Those stories are:

These are testing times for humankind, and therefore the importance of looking for smarter answers to our problems is greater than ever. “We need to do things better, and that urgency has made people realize that there are often simple solutions already available that don't require extreme physical or chemical processes,” says Lyne-Smith. “This is creating opportunities, and people are opening themselves up to what exists in nature.”