Amyris, a biotech company that produces sustainable ingredients for various industries, has filed for Chapter 11 bankruptcy protection in the U.S. on Wednesday. The company said it intends to sell its consumer brands, such as Biossance, Pipette, and Purecane, to improve its liquidity position. The company also said it has secured a $190 million financing commitment to support its operations during the bankruptcy process.
Amyris’ Business Model and Challenges
Amyris was founded in 2003 as a spin-off from the University of California, Berkeley. The company uses synthetic biology and fermentation to produce molecules that can be used as ingredients for cosmetics, fragrances, flavors, health care, and fuels. The company claims that its products are more environmentally friendly and cost-effective than conventional sources.
However, Amyris has faced several challenges and difficulties in its business model. The company has been losing money for years, as it struggled to scale up its production, lower its costs, and generate consistent revenues. The company also faced competition from other biotech firms and traditional suppliers. The company also had a high debt burden, with more than $1 billion of debt due in 2024.
The pandemic worsened Amyris’ situation, as it disrupted its supply chains, reduced its demand, and increased its expenses. The company also faced a lawsuit from the U.S. Department of Justice, which accused it of overcharging the Defense Department and lying about it.
Amyris’ Bankruptcy Plan and Outlook
Amyris said it filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of Delaware, with the aim of restructuring its debt and streamlining its business portfolio. The company said it has reached an agreement with most of its creditors to reduce its debt by more than 80% through a debt-for-equity swap. The company also said it has received interest from several potential strategic and financial partners who could help it emerge from bankruptcy as a stronger and more competitive company.
Amyris said it plans to sell its consumer brands, which include Biossance, a skin care line; Pipette, a baby care line; Purecane, a zero-calorie sweetener; Rose Inc., a makeup line; and Terasana, a wellness line. The company said these brands have high growth potential and strong customer loyalty, but they also require significant capital investment and marketing expenses. The company said it expects to generate more than $500 million from the sale of these brands.
Amyris said it will focus on its core competencies in research and development, fermentation, and ingredient production. The company said it will continue to serve its existing customers in the cosmetics, health care, and fuels industries, as well as explore new opportunities in the biopharma and animal health sectors.
Amyris said it expects to complete its bankruptcy process within six months. The company said it will work with its employees, customers, suppliers, and other stakeholders to ensure a smooth transition and minimize any disruption.
