Guesstimating the Size of the Global Array Synthesis Market

(Updated, Aug 31, for clarity.)

After chats with a variety of interested parties over the last couple of months, I decided it would be useful to try to sort out how much DNA is synthesized annually on arrays, in part to get a better handle on what sort of capacity it represents for DNA data storage. The publicly available numbers, as usual, are terrible, which is why the title of the post contains the word "guesstimating". Here goes.

First, why is this important? As the DNA synthesis industry grows, and the number of applications expands, new markets are emerging that use that DNA in different ways. Not all that DNA is produced using the same method, and the different methods are characterized by different costs, error rates, lengths, throughput, etc. (The Wikipedia entry on Oligonucleotide Synthesis is actually fairly reasonable, if you want to read more. See also Kosuri and Church, "Large-scale de novo DNA synthesis: technologies and applications".) If we are going to understand the state of the technology, and the economy built on that technology, then we need to be careful about measuring what the technology can do and how much it costs. Once we pin down what the world looks like today, we can start trying to make sensible projections, or even predictions, about the future.

While there is just one basic chemistry used to synthesize oligonucleotides, there are two physical formats that give you two very different products. Oligos synthesized on individual columns, which might be packed into 384 (or more) well plates, can be manipulated as individual sequences. You can use those individual sequences for any number of purposes, and if you want just one sequence at a time (for PCR or hybridization probes, gene therapy, etc), this is probably how you make it. You can build genes from column oligos by combining them pairwise, or in larger numbers, until you get the size construct you want (typically of order a thousand bases, or a kilobase [kB], at which point you start manipulating the kB fragments). I am not going to dwell on gene assembly and error correction strategies here; you can Google that.

The other physical format is array synthesis, in which synthesis takes place on a solid surface consisting of up to a million different addressable features, where light or charge is used to control which sequence is grown on which feature. Typically, all the oligos are removed from the array at once, which results in a mixed pool. You might insert this pool into a longer backbone sequence to construct a library of different genes that code for slightly different protein sequences, in order to screen those proteins for the characteristics you want. Or, if you are ambitious, you might use the entire pool of array oligos to directly assemble larger constructs such as genes. Again, see Google, Codon Devices, Gen9, Twist, etc. More relevant to my purpose here, a pool of array-synthesized oligos can be used as an extremely dense information storage medium. To get a sense of when that might be a viable commercial product, we need to have an idea of the throughput of the industry, and how far away from practical implementation we might be. 

Next, to recap, last year I made a stab at estimating the size of the gene synthesis market. Much of the industry revenue data came from a Frost & Sullivan report, commissioned by Genscript for its IPO prospectus. The report put the 2014 market for synthetic genes at only $137 million, from which I concluded that the total number of bases shipped as genes that year was 4.8 billion, or a bit less than a duplex human genome. Based on my conversations with people in the industry, I conclude that most of those genes were assembled from oligos synthesized on columns, with a modest, but growing, fraction from array oligos. (See "On DNA and Transistors", and preceding posts, for commentary on the gene synthesis industry and its future.)

The Frost & Sullivan report also claims that the 2014 market for single-stranded oligonucleotides was $241 million. The Genscript IPO prospectus does not specify whether this $241 million was from both array- and column-synthesized oligos, or not. But because Genscript only makes and uses column synthesis, I suspect it referred only to that synthesis format.  At ~$0.01 per base (give or take), this gives you about 24 billion bases synthesized on columns sold in 2014. You might wind up paying as much as $0.05 to $0.10 per base, depending on your specifications, which if prevalent would pull down the total global production volume. But I will stick with $0.01 per base for now. If you add the total number of bases sold as genes and the bases sold as oligos, you get to just shy of 30 billion bases (leaving aside for the moment the fact that an unknown fraction of the genes came from oligos synthesized on arrays).

So, now, what about array synthesis? If you search the interwebs for information on the market for array synthesis, you get a mess of consulting and marketing research reports that cost between a few hundred and many thousands of dollars. I find this to be an unhelpful corpus of data and analysis, even when I have the report in hand, because most of the reports are terrible at describing sources and methods. However, as there is no other source of data, I will use a rough average of the market sizes from the abstracts of those reports to get started. Many of the reports claim that in 2016 the global market for oligo synthesis was ~$1.3 billion, and that this market will grow to $2.X billion by 2020 or so. Of the $1.3B 2016 revenues, the abstracts assert that approximately half was split evenly between "equipment and reagents". I will note here that this should already make the reader skeptical of the analyses, because who is selling ~$260M worth of synthesis "equipment"? And who is buying it? Seems fishy. But I can see ~$260M in reagents, in the form of various columns, reagents, and purification kit. This trade, after all, is what keeps outfits like Glenn Research and Trilink in business.

Forging ahead through swampy, uncertain data, that leaves us with ~$650M in raw oligos. Should we say this is inclusive or exclusive of the $241M figure from Frost & Sullivan? I am going to split the difference and call it $500M, since we are already well into hand waving territory by now, anyway. How many bases does this $500M buy?

Array oligos are a lot cheaper than column oligos. Kosuri and Church write that "oligos produced from microarrays are 2–4 orders of magnitude cheaper than column-based oligos, with costs ranging from $0.00001–0.001 per nucleotide, depending on length, scale and platform." Here we stumble a bit, because cost is not the same thing as price. As a consumer, or as someone interested in understanding how actually acquiring a product affects project development, I care about price. Without knowing a lot more about how this cost range is related to price, and the distribution of prices paid to acquire array oligos, it is hard to know what to do with the "cost" range. The simple average cost would be $0.001 per base, but I also happen to know that you can get oligos en masse for less than that. But I do not know what the true average price is. For the sake of expediency, I will call it $0.0001 per base for this exercise.

Combining the revenue estimate and the price gives us about 5E12 bases per year. From there, assuming roughly 100-mer oligos, you get to 5E10 difference sequences. And adding in the number of features per array (between 100,000 and 1M), you get as many as 500,000 arrays run per year, or about 1370 per day. (It is not obvious that you should think of this as 1370 instruments running globally, and after seeing the Agilent oligo synthesis operation a few years ago, I suggest that you not do that.) If the true average price is closer to $0.00001 per base, then you can bump up the preceding numbers by an order of magnitude. But, to be conservative, I won't do that here. Also note that the ~30 billion bases synthesized on columns annually are not even a rounding error on the 5E12 synthesized on arrays.

Aside: None of these calculations delve into the mass (or the number of copies) per synthesized sequence. In principle, of course, you only need one perfect copy of each sequence, whether synthesized on columns or arrays, to use DNA in any just about application (except where you need to drive the equilibrium or reaction kinetics). Column synthesis gives you many more copies (i.e., more mass per sequence) than array synthesis. In principle — ignoring the efficiency of the chemical reactions — you could dial down the feature size on arrays until you were synthesizing just one copy per sequence. But then it would become exceedingly important to keep track of that one copy through successive fluidic operations, which sounds like a quite difficult prospect. So whatever the final form factor, an instrument needs to produce sufficient copies per sequence to be useful, but not so many that resources are wasted on unnecessary redundancy/degeneracy.

Just for shits and giggles, and because array synthesis could be important for assembling the hypothetical synthetic human genome, this all works out to be enough DNA to assemble 833 human duplex genomes per year, or 3 per day, in the absence of any other competing uses, of which there are obviously many. Also if you don't screw up and waste some of the DNA, which is inevitable. Finally, at a density of ~1 bit/base, this is enough to annually store 5 TB of data, or the equivalent of one very beefy laptop hard drive.

And so, if you have access to the entire global supply of single stranded oligonucleotides, and you have an encoding/decoding and sequencing strategy that can handle significant variations in length and high error rates at scale, you can store enough HD movies and TV to capture most of the new, good stuff that HollyBollyWood churns out every year. Unless, of course, you also need to accommodate the tastes and habits of a tween daughter, in which case your storage budget is blown for now and evermore no matter how much capacity you have at hand. Not to mention your wallet. Hey, put down the screen and practice the clarinet already. Or clean up your room! Or go to the dojo! Yeesh! Kids these days! So many exclamations!

Where was I?

Now that we have some rough numbers in hand, we can try to say something about the future. Based on my experience working on the Microsoft/UW DNA data storage project, I have become convinced that this technology is coming, and it will be based on massive increases in the supply of synthetic DNA. To compete with an existing tape drive (see the last few 'graphs of this post), able to read and write ~2 Gbits a second, a putative DNA drive would need to be able to read and write ~2 GBases per second, or ~183 Pbits/day, or the equivalent of ~10,000 human genomes a day — per instrument/device. Based on the guesstimate above, which gave a global throughput of just 3 human genomes per day, we are waaaay below that goal.

To be sure, there is probably some demand for a DNA storage technology that can work at lower throughputs: long term cold storage, government archives, film archives, etc. I suspect, however, that the many advantages of DNA data storage will attract an increasing share of the broader archival market once the basic technology is demonstrated on the market. I also suspect that developing the necessary instrumentation will require moving away from the existing chemistry to something new and different, perhaps enzymatically controlled synthesis, perhaps even with the aid of the still hypothetical DNA "synthase", which I first wrote about 17 years ago.

In any event, based on the limited numbers available today, it seems likely that the current oligo array industry has a long way to go before it can supply meaningful amounts of DNA for storage. It will be interesting to see how this all evolves.

A Few Thoughts and References Re Conservation and Synthetic Biology

Yesterday at Synthetic Biology 7.0 in Singapore, we had a good discussion about the intersection of conservation, biodiversity, and synthetic biology. I said I would post a few papers relevant to the discussion, which are below.

These papers are variously: the framing document for the original meeting at the University of Cambridge in 2013 (see also "Harry Potter and the Future of Nature"), sponsored by the Wildlife Conservation Society; follow on discussions from meetings in San Francisco and Bellagio; and my own efforts to try to figure out how quantify the economic impact of biotechnology (which is not small, especially when compared to much older industries) and the economic damage from invasive species and biodiversity loss (which is also not small, measured as either dollars or jobs lost). The final paper in this list is my first effort to link conservation and biodiversity with economic and physical security, which requires shifting our thinking from the national security of nation states and their political boundaries to the natural security of the systems and resources that those nation states rely on for continued existence.

"Is It Time for Synthetic Biodiversity Conservation?", Antoinette J. Piaggio1, Gernot Segelbacher, Philip J. Seddon, Luke Alphey, Elizabeth L. Bennett, Robert H. Carlson, Robert M. Friedman, Dona Kanavy, Ryan Phelan, Kent H. Redford, Marina Rosales, Lydia Slobodian, Keith WheelerTrends in Ecology & Evolution, Volume 32, Issue 2, February 2017, Pages 97–107

Robert Carlson, "Estimating the biotech sector's contribution to the US economy", Nature Biotechnology, 34, 247–255 (2016), 10 March 2016

Kent H. Redford, William Adams, Rob Carlson, Bertina Ceccarelli, “Synthetic biology and the conservation of biodiversity”, Oryx, 48(3), 330–336, 2014.

"How will synthetic biology and conservation shape the future of nature?", Kent H. Redford, William Adams, Georgina Mace, Rob Carlson, Steve Sanderson, Framing Paper for International Meeting, Wildlife Conservation Society, April 2013.

"From national security to natural security", Robert Carlson, Bulletin of the Atomic Scientists, 11 Dec 2013.

Warning: Construction Ahead

I am migrating from Movable Type to Squarespace. There was no easy way to do this. Undoubtedly, there are presently all sorts of formatting hiccups, lost media and images, and broken links. If you are looking for something in particular, use the Archive or Search tabs.

If you have a specific link you are trying to follow, and it has dashes between words, try replacing them with underscores. E.g., instead of "www.synthesis.cc/x-y-z", try "www.synthesis.cc/x_y_z". If the URL ends in "/x.html", try replacing that with "/x/".

I will be repairing links, etc., as I find them.

Late Night, Unedited Musings on Synthesizing Secret Genomes

By now you have probably heard that a meeting took place this past week at Harvard to discuss large scale genome synthesis. The headline large genome to synthesize is, of course, that of humans. All 6 billion (duplex) bases, wrapped up in 23 pairs of chromosomes that display incredible architectural and functional complexity that we really don't understand very well just yet. So no one is going to be running off to the lab to crank out synthetic humans. That 6 billion bases, by the way, just for one genome, exceeds the total present global demand for synthetic DNA. This isn't happening tomorrow. In fact, synthesizing a human genome isn't going to happen for a long time.

But, if you believe the press coverage, nefarious scientists are planning pull a Frankenstein and "fabricate" a human genome in secret. Oh, shit! Burn some late night oil! Burn some books! Wait, better — burn some scientists! Not so much, actually. There are a several important points here. I'll take them in no particular order.

First, it's true, the meeting was held behind closed doors. It wasn't intended to be so, originally. The rationale given by the organizers for the change is that a manuscript on the topic is presently under review, and the editor of the journal considering the manuscript made it clear that it considers the entire topic under embargo until the paper is published. This put the organizers in a bit of a pickle. They decided the easiest way to comply with the editor's wishes (which were communicated to the authors well after the attendees had made travel plans) was to hold the meeting under rules even more strict than Chatham House until the paper is published. At that point, they plan to make a full record of the meeting available. It just isn't a big deal. If it sounds boring and stupid so far, it is. The word "secret" was only introduced into the conversation by a notable critic who, as best I can tell, perhaps misconstrued the language around the editor's requirement to respect the embargo. A requirement that is also boring and stupid. But, still, we are now stuck with "secret", and all the press and bloggers who weren't there are seeing Watergate headlines and fame. Still boring and stupid.

Next, It has been reported that there were no press at the meeting. However, I understand that there were several reporters present. It has also been suggested that the press present were muzzled. This is a ridiculous claim if you know anything about reporters. They've simply been asked to respect the embargo, which so far they are doing, just like they do with every other embargo. (Note to self, and to readers: do not piss off reporters. Do not accuse them of being simpletons or shills. Avoid this at all costs. All reporters are brilliant and write like Hemingway and/or Shakespeare and/or Oliver Morton / Helen Branswell / Philip Ball / Carl Zimmer / Erica Check-Hayden. Especially that one over there. You know who I mean. Just sayin'.)

How do I know all this? You can take a guess, but my response is also covered by the embargo.

Moving on: I was invited to the meeting in question, but could not attend. I've checked the various associated correspondence, and there's nothing about keeping it "secret". In fact, the whole frickin' point of coupling the meeting to a serious, peer-reviewed paper on the topic was to open up the conversation with the public as broadly as possible. (How do you miss that unsubtle point, except by trying?) The paper was supposed to come out before, or, at the latest, at the same time as the meeting. Or, um, maybe just a little bit after? But, whoops. Surprise! Academic publishing can be slow and/or manipulated/politicized. Not that this happened here. Anyway, get over it. (Also: Editors! And, reviewers! And, how many times will I say "this is the last time!")

(Psst: an aside. Science should be open. Biology, in particular, should be done in the public view and should be discussed in the open. I've said and written this in public on many occasions. I won't bore you with the references. [Hint: right here.] But that doesn't mean that every conversation you have should be subject to review by the peanut gallery right now. Think of it like a marriage/domestic partnership. You are part of society; you have a role and a responsibility, especially if you have children. But that doesn't mean you publicize your pillow talk. That would be deeply foolish and would inevitably prevent you from having honest conversations with your spouse. You need privacy to work on your thinking and relationships. Science: same thing. Critics: fuck off back to that sewery rag in — wait, what was I saying about not pissing off reporters?)

Is this really a controversy? Or is it merely a controversy because somebody said it is? Plenty of people are weighing in who weren't there or, undoubtedly worse from their perspective, weren't invited and didn't know it was happening. So I wonder if this is more about drawing attention to those doing the shouting. That is probably unfair, this being an academic discussion, full of academics.

Secondly (am I just on secondly?), the supposed ethical issues. Despite what you may read, there is no rush. No human genome, nor any human chromosome, will be synthesized for some time to come. Make no mistake about how hard a technical challenge this is. While we have some success in hand at synthesizing yeast chromosomes, and while that project certainly serves as some sort of model for other genomes, the chromatin in multicellular organisms has proven more challenging to understand or build. Consequently, any near-term progress made in synthesizing human chromosomes is going to teach us a great deal about biology, about disease, and about what makes humans different from other animals. It is still going to take a long time. There isn't any real pressing ethical issue to be had here, yet. Building the ubermench comes later. You can be sure, however, that any federally funded project to build the ubermench will come with a ~2% set aside to pay for plenty of bioethics studies. And that's a good thing. It will happen.

There is, however, an ethical concern here that needs discussing. I care very deeply about getting this right, and about not screwing up the future of biology. As someone who has done multiple tours on bioethics projects in the U.S. and Europe, served as a scientific advisor to various other bioethics projects, and testified before the Presidential Commission on Bioethical Concerns (whew!), I find that many of these conversations are more about the ethicists than the bio. Sure, we need to have public conversations about how we use biology as a technology. It is a very powerful technology. I wrote a book about that. If only we had such involved and thorough ethical conversations about other powerful technologies. Then we would have more conversations about stuff. We would converse and say things, all democratic-like, and it would feel good. And there would be stuff, always more stuff to discuss. We would say the same things about that new stuff. That would be awesome, that stuff, those words. <dreamy sigh> You can quote me on that. <another dreamy sigh>

But on to the technical issues. As I wrote last month, I estimate that the global demand for synthetic DNA (sDNA) to be 4.8 billion bases worth of short oligos and ~1 billion worth of longer double-stranded (dsDNA), for not quite 6 Gigabases total. That, obviously, is the equivalent of a single human duplex genome. Most of that demand is from commercial projects that must return value within a few quarters, which biotech is now doing at eye-popping rates. Any synthetic human genome project is going to take many years, if not decades, and any commercial return is way, way off in the future. Even if the annual growth in commercial use of sDNA were 20% — which is isn't — this tells you, dear reader, that the commercial biotech use of synthetic DNA is never, ever, going to provide sufficient demand to scale up production to build many synthetic human genomes. Or possibly even a single human genome. The government might step in to provide a market to drive technology, just as it did for the human genome sequencing project, but my judgement is that the scale mismatch is so large as to be insurmountable. Even while sDNA is already a commodity, it has far more value in reprogramming crops and microbes with relatively small tweaks than it has in building synthetic human genomes. So if this story were only about existing use of biology as technology, you could go back to sleep.

But there is a use of DNA that might change this story, which is why we should be paying attention, even at this late hour on a Friday night.

DNA is, by far, the most sophisticated and densest information storage medium humans have ever come across. DNA can be used to store orders of magnitude more bits per gram than anything else humans have come up with. Moreover, the internet is expanding so rapidly that our need to archive data will soon outstrip existing technologies. If we continue down our current path, in coming decades we would need not only exponentially more magnetic tape, disk drives, or flash memory, but exponentially more factories to produce these storage media, and exponentially more warehouses to store them. Even if this is technically feasible it is economically implausible. But biology can provide a solution. DNA exceeds by many times even the theoretical capacity of magnetic tape or solid state storage.

A massive warehouse full of magnetic tapes might be replaced by an amount of DNA the size of a sugar cube. Moreover, while tape might last decades, and paper might last millennia, we have found intact DNA in animal carcasses that have spent three-quarters of a million years frozen in the Canadian tundra. Consequently, there is a push to combine our ability to read and write DNA with our accelerating need for more long-term information storage. Encoding and retrieval of text, photos, and video in DNA has already been demonstrated. (Yes, I am working on one of these projects, but I can't talk about it just yet. We're not even to the embargo stage.) 

Governments and corporations alike have recognized the opportunity. Both are funding research to support the scaling up of infrastructure to synthesize and sequence DNA at sufficient rates.

For a “DNA drive” to compete with an archival tape drive today, it needs to be able to write ~2Gbits/sec, which is about 2 Gbases/sec. That is the equivalent of ~20 synthetic human genomes/min, or ~10K sHumans/day, if I must coin a unit of DNA synthesis to capture the magnitude of the change. Obviously this is likely to be in the form of either short ssDNA, or possibly medium-length ss- or dsDNA if enzymatic synthesis becomes a factor. If this sDNA were to be used to assemble genomes, it would first have to be assembled into genes, and then into synthetic chromosomes, a non trivial task. While this would be hard, and would to take a great deal of effort and PhD theses, it certainly isn't science fiction.

But here, finally, is the interesting bit: the volume of sDNA necessary to make DNA information storage work, and the necessary price point, would make possible any number of synthetic genome projects. That, dear reader, is definitely something that needs careful consideration by publics. And here I do not mean "the public", the 'them' opposed to scientists and engineers in the know and in the do (and in the doo-doo, just now), but rather the Latiny, rootier sense of "the people". There is no them, here, just us, all together. This is important.

The scale of the demand for DNA storage, and the price at which it must operate, will completely alter the economics of reading and writing genetic information, in the process marginalizing the use by existing multibillion-dollar biotech markets while at the same time massively expanding capabilities to reprogram life. This sort of pull on biotechnology from non-traditional applications will only increase with time. That means whatever conversation we think we are having about the calm and ethical development biological technologies is about to be completely inundated and overwhelmed by the relentless pull of global capitalism, beyond borders, probably beyond any control. Note that all the hullabaloo so far about synthetic human genomes, and even about CRISPR editing of embryos, etc., has been written by Western commentators, in Western press. But not everybody lives in the West, and vast resources are pushing development of biotechnology outside of the of West. And that is worth an extended public conversation.

So, to sum up, have fun with all the talk of secret genome synthesis. That's boring. I am going off the grid for the rest of the weekend to pester litoral invertebrates with my daughter. You are on your own for a couple of days. Reporters, you are all awesome, make of the above what you will. Also: you are all awesome. When I get back to the lab on Monday I will get right on with fabricating the ubermench for fun and profit. But — shhh — that's a secret.

On DNA and Transistors

Here is a short post to clarify some important differences between the economics of markets for DNA and for transistors. I keep getting asked related questions, so I decided to elaborate here.

But first, new cost curves for reading and writing DNA. The occasion is some new data gleaned from a somewhat out of the way source, the Genscript IPO Prospectus. It turns out that, while preparing their IPO docs, Genscript hired Frost & Sullivan to do market survey across much of life sciences. The Prospectus then puts Genscript's revenues in the context of the global market for synthetic DNA, which together provide some nice anchors for discussing how things are changing (or not).

So, with no further ado, Frost & Sullivan found that the 2014 global market for oligos was $241 million, and the global market for genes was $137 million. (Note that I tweeted out larger estimates a few weeks ago when I had not yet read the whole document.) Genscript reports that they received $35 million in 2014 for gene synthesis, for 25.6% of the market, which they claim puts them in the pole position globally. Genscript further reports that the price for genes in 2014 was $.34 per base pair. This sounds much too high to me, so it must be based on duplex synthesis, which would bring the linear per base cost down to $.17 per base, which sounds much more reasonable to me because it is more consistent with what I hear on the street. (It may be that Gen9 is shipping genes at $.07 per base, but I don't know anyone outside of academia who is paying that low a rate.) If you combine the price per base and the size of the market, you get about 1 billion bases worth of genes shipped in 2014 (so a million genes, give or take). This is consistent with Ginkgo's assertions saying that their 100 million base deal with Twist was the equivalent of 10% of the global gene market in 2015. For oligos, if you combine Genscript's reported average price per base, $.05, with the market size you get about 4.8 billion bases worth of oligos shipped in 2014. Frost & Sullivan thinks that from 2015 to 2019 the oligo market CAGR will be 6.6% and the gene synthesis market will come in at 14.7%.

For the sequencing, I have capitulated and put the NextSeq $1000 human genome price point on the plot. This instrument is optimized to sequence human DNA, and I can testify personally that sequencing arbitrary DNA is more expensive because you have to work up your own processes and software. But I am tired of arguing with people. So use the plot with those caveats in mind.

What is most remarkable about these numbers is how small they are. The way I usually gather data for these curves is to chat with people in the industry, mine publications, and spot check price lists. All that led me to estimate that the gene synthesis market was about $350 million (and has been for years) and the oligo market was in the neighborhood of $700 million (and has been for years).

If the gene synthesis market is really only $137 million, with four or 5 companies vying for market share, then that is quite an eye opener. Even if that is off by a factor of two or three, getting closer to my estimate of $350 million, that just isn't a very big market to play in. A ~15% CAGR is nothing to sneeze at, usually, and that is a doubling rate of about 5 years. But the price of genes is now falling by 15% every 3-4 years (or only about 5% annually). So, for the overall dollar size of the market to grow at 15%, the number of genes shipped every year has to grow at close to 20% annually. That's about 200 million additional bases (or ~200,000 more genes) ordered in 2016 compared to 2015. That seems quite large to me. How many users can you think of who are ramping up their ability to design or use synthetic genes by 20% a year? Obviously Ginkgo, for one. As it happens, I do know of a small number of other such users, but added together they do not come close to constituting that 20% overall increase. All this suggests to me that the dollar value of the gene synthesis market will be hard pressed to keep up with Frost & Sullivan estimate of 14.7% CAGR, at least in the near term. As usual, I will be happy to be wrong about this, and happy to celebrate faster growth in the industry. But bring me data.

People in the industry keep insisting that once the price of genes falls far enough, the ~$3 billion market for cloning will open up to synthetic DNA. I have been hearing that story for a decade. And then price isn't the only factor. To play in the cloning market, synthesis companies would actually have to be able to deliver genes and plasmids faster than cloning. Given that I'm hearing delivery times for synthetic genes are running at weeks, to months, to "we're working on it", I don't see people switching en mass to synthetic genes until the performance improves. If it costs more to have your staff waiting for genes to show up by FedEx than to have them bash the DNA by hand, they aren't going to order synthetic DNA.

And then what happens if the price of genes starts falling rapidly again? Or, forget rapidly, what about modestly? What if a new technology comes in and outcompetes standard phosphoramidite chemistry? The demand for synthetic DNA could accelerate and the total market size still might be stagnant, or even fall. It doesn't take much to turn this into a race to the bottom. For these and other reasons, I just don't see the gene synthesis market growing very quickly over the next 5 or so years.

Which brings me to transistors. The market for DNA is very unlike the market for transistors, because the role of DNA in product development and manufacturing is very unlike the role of transistors. Analogies are tremendously useful in thinking about the future of technologies, but only to a point; the unwary may miss differences that are just as important as the similarities.

For example, the computer in your pocket fits there because it contains orders of magnitude more transistors than a desktop machine did fifteen years ago. Next year, you will want even more transistors in your pocket, or on your wrist, which will give you access to even greater computational power in the cloud. Those transistors are manufactured in facilities now costing billions of dollars apiece, a trend driven by our evidently insatiable demand for more and more computational power and bandwidth access embedded in every product that we buy. Here is the important bit: the total market value for transistors has grown for decades precisely because the total number of transistors shipped has climbed even faster than the cost per transistor has fallen.

In contrast, biological manufacturing requires only one copy of the correct DNA sequence to produce billions in value. That DNA may code for just one protein used as a pharmaceutical, or it may code for an entire enzymatic pathway that can produce any molecule now derived from a barrel of petroleum. Prototyping that pathway will require many experiments, and therefore many different versions of genes and genetic pathways. Yet once the final sequence is identified and embedded within a production organism, that sequence will be copied as the organism grows and reproduces, terminating the need for synthetic DNA in manufacturing any given product. The industrial scaling of gene synthesis is completely different than that of semiconductors.