This is Bloomberg Business Week with Carol Messer and Tim Steneveek on Bloomberg Radio.
Well, the European Commission, the EUS regulator, proposed yesterday a set of laws that tackle gene edited plants, food and textile waste, soil health and seeds. They will complement an earlier package to green sectors from transport to energy and trade in a bid to put Europe on track to meet its new twenty to thirty goal of reducing emissions by at least fifty five percent from nineteen ninety levels. The proposal aims to ease regulations for crops made with
so called new genomic techniques ngts. So we're going to get into this a little bit of an explainer for you all. Rory Riggs is CEO the publicly held small cap company Sibis, which develops in linessiness plant trades to seed companies. He joins us here in our Bloomberg Interactive Broker studio at the stock by the way, is at one hundred and ten percent so far here in twenty twenty three, and there was a merger.
So a lot of things happening for you guys. Welcome, welcome, nice to have you here.
Thanks for vetting me.
So tell us a little about your company. Dig a little bit deeper.
I gave it a quick little explainer, but tell us what you guys are exactly doing.
What we're doing. We are the leaders in the post GMO world. And the post GMO world is called gene editing, and gene editing.
Because GMO was genetically modified.
Yes and okay, so go ahead, but genically modified it to if they take foreign DNA or transgenes and put them into plants, and because of it, they get things called traits. BT is the most famous one. It's an engineered protein that makes the plant poisonous insects, and when insects eat it, they die. And so this trait got rid of a lot of INSTANCEX that i'd use the great productivity, but you still had a plant that had
this engineered protein stuck in it. What the gene editing guys do is they hijack nature's own way, and so they just only make changes that could naturally occur on their own. And that's why it's been It's a big advance in the technology. You see it in human stuff. It's an industrial field. And so the idea that if you could take plants and they have their own natural repair mechanism. If you could take that repair mechanism and
make the repair. That said, if you have these genes that this other plant has, maybe you won't get skeleitinia. You won't need fungicide for it, or you won't need it'll give you different traits.
These traits are so basically, are you weeding out the bad stuff?
No, I think because that's.
Genetically modified to some extent.
Right, Yeah, nothing, we'd do. We will we will never have a product that couldn't have occurred in nature. Okay, that's the most important thing what we would do. So for our first trade for disease for squeritinia, there's Atinia is a white mold. It happens in like the oil seed plants, and it causes major yield losses and cost of fortune to fungicides to manage. And so the idea is, if we there's some plants that don't get this disease, right, so if you.
Could figure out that naturally occur in nature, yes, so you're going to replicate that.
They're going to replicate that exactly right, That's exactly what we're doing. And so Suddenly these plans won't need fund you side, and these plants won't have this disease. And that's the nature of what we're trying to do. And there's so many big diseases where this works. And these diseases from rust to serium, these are diseases. They're killing crops, and these are diseases. And now there's a hope that you could make changes in real time. You know, the
whole there's two things going on. It's one this technology to make changes as though they were natural, and two to be the ability to do it in the fraction of the time and cost of normal breeding. And we talk about is agriculture has never had their technology moment. They're analog to digital moment. Just look at breeding and you realize this is analog and so they take sixteen point five years and we take less than five. That's the nature in the real time you could do things.
You know, even bear yesterday when they said the whole porpoise of this new technology is it takes us sixteen and a half years, and with this technology, we could do it less than five.
How new is it.
It's taken us twenty years to get here?
Why was it so difficult.
It was difficult not so much to make changes, but do it in a way that you know, we were building the first trait factory and so that's we're going to have biopharmaceutical standards. We expect I think called isostandards around it to build those things. Just like in biotech. This takes a long time to get the standards correct and to be able to master the technology in a way that you would say, this isn't magic. This is really a scientifically proven way of adapting changes. And all
the regulators are focused totally on this word. Is it a scientific method that is trackable and manasubles you know every step of the process what's going on, and that just doesn't happen overnight.
Are regulators starting to get more onboard with GMOs in general that can be productive.
So the regulators. What's happening is the regulators. The Britze is a big favor. A couple of years ago they wrote a big paper on our technology and explain that the traits from our technology you're into signatule from nature and they send it out to everybody and since then
every country's sort of taken two paths. One there's a GMO path which could take forever to get proved and treated like a drug, and another path for gene editing, and if you qualify for this path, you will be regulated as conventional breeding.
So you're viewed as gene editing non GMOs and that is more helpful in terms of regulation and getting past some of the red tape of that regulation and totally definable.
And so they all have this rules that says if you're here like us has it was called you know am I Regulator and Secure Act, they have rules and if you can prove you fit in these rules so you are like nature, they're going to say go. And that's what Europe when you read through their things, that's what they're saying.
Also, can every plant be gene edited? Yes, because you've done it.
Already or no.
No, our focus as you would hope. There's five big crops that are like five hundred million acres and that's what you want me to be focused on. You want you can't grow these crops in vertical farms. You need something like us to be able to make changes so that they can fight nature themselves.
So what are the crops that you guys do?
Then we started with canola and rice, and for us our technology to work, we need to be able to take a single cell and grow it into a plant that allows us to then edit that cell. Somebody sends us their plant, we can take a single sell and grow and that's called a fancy word called a protoplast model. But the ideas we've done it in two crops, and we're really close to soybean. So one by one we're going to do this model in canola, rice and soybean,
and then follow it with wheat and corn. Those are your big grains.
Wheat would be huge for I mean, they're obviously all huge, but I just can't help but think about the impact that you know, the Russian invasion of Ukraine has had in terms of wheat production and access to food globally.
It's been cataclysmic, and they all have.
One disease, like in wheat rust. If you can solve rust, god, you change the whole farmer's mode. And that's the promise our techn energy can do.
So Rory, who are your biggest customers, the seed companies, all of them, that's the idea. You're Monsanto's, You're like all of them.
Yeah, So our Our vision of breeding is something we call a high throughput gene editing system that works as a service industry to the seed companies, right, and so we can do it and just as they're getting ready to launch, they send us their elite germ plasm and we can which which was just the the germ plasm they're ready to launch, they can ship us. We can then take that germ plasm, edit it and grow back their plant with everything that had plus our edits, and
give it back to them. And we can do that in years.
So the edits are the things that.
You that we do.
But it's years.
Yeah, well it's years because you have to grow these plants. You can't fight nature.
How long take go through the process, right, Yes, so that.
If you do it, if you edit a seed, it could take a year for that seed to be a plant, right, you can't short circuit that. But soon after that and then we have the same type of quality assurance things you would hope to make sure you're safe. So we're the we're curating a new industry. So it's so desperate that we do it correctly. Yeah, it makes sense, and so that's why it does.
It's really it's really interesting. The process all done in a lab. I'm assuming right, it's all.
Done in the lab, and we're really excited. Soon we're gonna announce we call it a trade machine. We have something called our TDS, which just a rapid trade development system, which is the first end to end system. If you did it here, we can track a series of step wise change just to hear, so you can manage it. And we're going to make a we called a traite machine, a factory that's going to be able to do this.
I want to get right back to Rory Riggs.
He's chief executive officer of Sibis, as we said, publicly held small cap company. He is still with Maddie and me in our Bloomberg Interactive Broker studio.
And I keep saying that.
The stock is up a ton, but as you say, you guys merged with Klyx, right, and so that certainly impacts in terms of what the share price, and that I think happened in June. Yes, yeah, so do my favorite tell us in our audience a little bit about your background.
So I went to Middlebury College and Columba University, and I was I came to an investment bank in New York, there was a leader in biotech, and so we were all there when Gentecho in public and am Genuine public and a lot of us all went off to be entrepreneurs in biotech. And so I've started a bunch of companies in biotech. Company called sud Gen was just the first kindness inhibitor company. And I ran a company called Biomatrix, which was the first company that took hyaluronic acid and
replaced your synolvia fluid. And I started a company called Royal gy Farm, which.
Many carolantic acid is like the stuff that's all in people's skin.
I was like, I know what that.
Is, right, it is that's laws invented this field, right, Yeah.
But it's really well when you think about genetics more broadly, whether it's in plants or whether it's in medicine, I mean holds the answers to a lot.
Who holds all the answers, especially for seeds, because seeds are basically just germplasms and traits. There's not organs in there. So the whole characteristics of a seed is based one profile, right, right, And so that's that's what you're playing with it. That's why It's so much like a movie, right change.
And in terms of the movie aspect of it, just to get like, really worst case scenario here, if we end up totally bad news climate change, can this completely replace our food sources? Someday it's not going to.
Place the feod sources, but suddenly, you know, we can totally make crops that are more efficient in the use of water. You know, we're totally making things that are more efficient than use of fertilizer, heat resistance. These are all things that are pretty well known, but it needed technology to be able to do them. And and and you think about it, but diseases in Saskatchewan used to be in Alabama, and so they be able to actually be and it's not like one thing you're just going
to have to keep updating it. And so there's no question that that that they need us to be successful.
And in terms and when you think about something like the seed vault, for example, how do you rate the effectedness of that moving forward?
It's hard for me to have a strong opinion on that without getting in trouble totally fair, you know, I think it's a really important thing. But for the moment, you know, we're dealing with major seed companies who like us, no farmers have a challenge. And then and the good thing is that the seed companies aren't resisting us. They think it's a really important technology for them and they're working with That's that's me My biggest takeaway.
Is it about increasing productivity or just increasing the likelihood of just having a good crop.
It's hard to differentiate those two topics. So because you're for some disease traits, it's not it doesn't exist everywhere. It's just sort of you you're increasing your probability that your crop. There's like a yes or nos. You're saying, how do I do something that says every five years
I die? So I'm pay you a little bit to not have that happen, And so that everything you're doing is trying to make the statistical odds of that crop performing the way you wanted to crop, because you don't really know what the weather is going to be every season. But that's what they're all paying for.
What I wanted to ask you is I'm thinking about our audience.
You're listening and hopefully everybody's following along, you know, because that's pretty heavy stuff in terms of what you guys are doing, and I just think about, you know, in terms of an investment audience, how should they be thinking about what you are doing about food production more broadly, because things are changing, things are being disrupted, there's lots of innovation going on. I think food and agg production have really lagged in terms of some innovation.
Beyond Yeah, I.
Have like a simpler thing because we have these five major crops and we've already working. Like in Canola, we have four different traits we're working on, and each of them are as big as the next one because you're solving different problems. I almost like to look at a crop as almost like a therapeutic area, and each of the traits are indication. So like in Canola, our first indication has been approved and they're launching it, and the following indications are in the field and we expect to
a launch so soon thereafter. These end up being really equivalent to giant, billion dollar therapeutic areas. So there's the trade I said on BT which makes its kills insects to be reduced insecticide use. That trait is now on three hundred million acres and they're getting fifteen dollars an acre. So that's the size, the scale of the change as an investment thesis, the scale that we can address, right, is this huge?
Why is the EU decision so important?
The EU decision is critical because they started the anti GMO movement and they're going to end it. Let's see, we joke that the revolution started yesterday. It was really important for them to step up and say, because.
They're comfortable with this, this is different.
Yes, let's focus on chemicals they want to get at the same time they're doing this. They want to get rid of fungicides. I want to get rid of inseecticides. They can't do it unless we work, and so it's really important. But Europe, a lot of the places the same with medical devices. A lot of places outside of the US follow Europe more than they follow US, and so Africa. When the US does this, all of Africa, which has been pangmos too, will suddenly start allowing it.
So it's really important for a lead globally.
Is gene editing when we bring you back on a year from now, is gene editing going to start to become a household understood topic.
I totally think when Europe passes this and people realize what it is. I think it'll be a totally understood topic. It's easier in humans because humans every disease is a little bit different. This you can I know it sounds complicated that way I'm describing it, but it's really pretty simple to think that with a couple of changes, suddenly you if you're in Arizona, suddenly your main crop can be grown there right, right right, and that love it.
People will get there right and that's so I do think they'll understand it and support it.
I tease that I was going to ask you about AI.
Does AI impact what you guys do potentially or generative AI machine learning? Does it help you in the process or maybe not yet because it's there's still questions about the reliability.
It's impossible for anybody any scientific field to say AI will not have an impact. And genomics, it's pretty cool.
I appreciate that from a scientist, is.
That there's thirty thousand genes in these plants to produce proteins and in different conditions. So any sort of computer modeling which allows you to understand relationships better and put them together will always have an impact because you're trying to understand better how the diseases of this plant affect diseases in this plant, and so it's a fundamental part of this industry. And the cool thing is these plants
all have similar structures. They're a little bit different, but if you solve it in one, suddenly you can use AI type technologies to make sure you understand how to do it.
And the rest of them, well, really fascinating.
My mind's kind of blowing a little bit, but kind of love this and let us know how things are going. It's really interesting, fascinating, something new.
Thanks for having me. It's a treat. We're desperately trying to let people understand what this new technology so for you said is really important, and we get it at the place that people understand it and accept.
So appreciate it.
Rory Riggs, chief executive officer of CEBIS, joining us here in Bloomberg Interactive Brokers Studio