Evolution is a process that refines an organism over millions and millions of years. Codexis has knocked the process down to a mere matter of weeks.

In March, researchers at the Redwood City, California-based maker of a customized biocatalyst for use in pharmaceutical and industrial manufacturing reported in a paper in the journal Nature that they had been able to achieve a 4,000-fold increase in productivity using a custom-engineered biocatalyst compared to the natural enzyme used by Pfizer to make a key building block of atorvastatin, the active ingredient in the cholesterol-lowering blockbuster Lipitor.

Biocatalysts, or enzymes, offer an alternative to conventional chemical manufacturing. In the making of pharmaceuticals, they can simplify the number of steps required and eliminate the need for temperature extremes for certain chemical reactions. What's more, they can also produce the desired end product without the impurities or toxic byproducts that often are part of the manufacturing process. Codexis said its biocatalysts can cut the cost of raw materials needed to create a substance by 30 to 50 percent.

"Bio is the new chemistry of the twenty-first century," said Alan Shaw, CEO of Codexis. "Our technology allows us to create novel, superior biocatalysts that make chemicals faster, cheaper, cleaner, and in some cases do chemical reactions that were previously impossible using biological catalysts or enzymes because those enzymes don't even exists in nature."

Though biocatalysts have long been used by academic researchers, the typically low productivity of most naturally occurring enzymes limited commercial interest in them. But with the need to improve manufacturing processes, pharmaceutical companies such as Pfizer are turning to biocatalysts to enhance manufacturing efficiency and reduce environmental waste. In part, what's helped the industry embrace the technology is Codexis' ability to produce custom-designed enzymes that can achieve their desired tasks far better than naturally occurring enzymes.

While there are multiple benefits offered by the technology, the big attraction is its cost benefits, said David Dodds of the Syracuse, New York-based biochemical process technology consultancy Dodds & Associates. "It's accepted in the pharmaceutical industry because cost is a driver," said Dodds, who also serves on Codexis' industrial advisory board.

Directed Evolution
Privately-held Codexis, a spin-off of Maxygen, which itself was a spin-off of the legendary Alejandro Zaffaroni's Affymax, uses a process it calls "directed evolution" to create super enzymes that efficiently perform specific chemical reactions. To get the desired enzyme, the company begins with genetic material for a class of enzyme capable of performing a desired type of reaction and then uses a process called "gene shuffling" to recombine the DNA to develop hybrids.

Next, the process creates a library of genes, which have a wide spectrum of novel or modified functions. The enzymes with the desired properties are identified using high throughput selection or screening assays. The best clones from one round are retained as the starting point for the next. This process is repeated until the enzyme is optimized for the task it needs to perform.

"Our technology allows us to create novel, superior biocatalysts that make chemicals faster, cheaper, cleaner," said Shaw, "and in some cases do chemical reactions that were previously impossible using biological catalysts or enzymes because those enzymes don't even exists in nature."

The growth in the pharmaceutical biocatalyst business has helped fuel growth at Codexis. The company has more than doubled in size during the past year. In addition to Pfizer, Codexis customers include Merck and Schering Plough. With its acquisition of the 25-person Pasedena-based BioCatalytics announced this month, its headcount today stands at about 200 and it is the dominant player in the enzyme market, which is expected to grow to a $2.2-billion business by 2010 from about $1.6 billion in 2005.

Protection Against Generics
Codexis operates three divisions. For pharmaceutical customers, the company said its enzymes not only reduce cost and environmental footprint, but also provide protection against generic competition because of the high purity of its end product and unique manufacturing method. A second division focused on generic pharmaceutical makers is driven by the cost benefits of its process.

Though the company doesn't disclose its revenues, Shaw said both the pharmaceutical and generic pharmaceutical divisions will turn profitable next year. Along with the industrial division, each represents about a third of the company's sales, he said. But he expects the greatest growth opportunity lies in its industrial division thanks to the emerging interest in biofuels.

"It certainly is a very attractive segment at this point," said Patrick Enright, managing director of Pequod Ventures and a member of its board of directors. "There are enormous markets. The velocity of technology development is extremely fast at present and there's a lot of capital being attracted to that segment and we've very excited about it."

Biofuel Potential
Codexis entered into collaboration with Shell Oil Products U.S. in November 2006 to explore enhanced methods of converting biomass to biofuels. Codexis' Shaw believes taking enzymes from nature, such as those found in the guts of termites, and trying to improve on them won't be adequate for developing processes for converting biofuel crops in an economic way. He thinks it will require the types of specialized enzymes the company creates.

"If you want to make alcohols as biofuels from wood pulp or switchgrass, you are wasting your time getting enzymes out of a termites gut," said Shaw. "That's not sensible from a scientific perspective. Enzymes in a termites gut were developed by nature to be deliberately slow and inefficient. If they were super enzymes, there'd be no wood on the planet."