What is 'Synthetic Biology'

Synthetic biology is the engineering of biomatter DNA to form something new in order to serve a specific purpose. Synthetically engineered organisms tend to be designed to overcome a flaw of the natural organism. The benefits of these synthetic organisms have positive implications for supply and demand of the product and/or public health.

BREAKING DOWN 'Synthetic Biology'

Synthetic biology creates organisms that defy their natural weaknesses. For example, apples can be engineered not to turn brown when bruised. Fish can be designed to breed twice as quickly as usual in order to speed population growth. Both of these are examples of products that have been approved by the Food and Drug Administration (FDA) for consumption. Other examples of synthetic biology include organisms that resist specific diseases to stop their spread or provide fodder for vaccines.

As synthetic biology is still a relatively new practice, regulations and protocol surrounding its implementation are still in flux. Many people are opposed to these biological advances, arguing that it's not natural. Controversy particularly surrounds the use of synthetic biology in the food and healthcare industries.

Who are the Major Players?

Ginkgo Bioworks leads the field in the fragrance and flavor industries. The company harvests a synthetically engineered strain of yeast in order to produce the extracts that alternatively take much longer to produce and are more expensive. Ginkgo's synthetic organisms are provided to its customers, who then use them to flavor their products, and Ginkgo retains the DNA sequencing information.

Other companies at the forefront of synthetic biology include Synthetic Genomics, Twist BioSciences, and Gen9.

Why Engage in Synthetic Biology?

The most prominent reason for engaging in synthetic biology is to improve health. As new diseases arise, scientists engineer organisms to resist the diseases, creating vaccines to stop their spread and hopefully eradicate them. For example, the company XON is currently engineering a synthetic organism to fight the Zika virus.

Synthetic biology also provides many economic benefits for both the producer and the consumer. It alleviates supply and demand problems when organisms are engineered to reproduce more rapidly. For example, breeding fish twice as quickly produces twice as many fish to sell, which directly translates to higher profits for the company. The consumer often enjoys a lower cost due to the efficiency and the high volume on the producer's end.

Synthetic biology also has the potential to offer higher quality products, such as the aforementioned apples that resist browning, which are more appealing to the consumer.

Synthetic biology can also alleviate costs in various markets, as the synthetic organisms are often more efficiently produced than their natural counterparts. The low cost and high efficiency allow affected industries to produce much higher volumes of product than it could otherwise.

RELATED TERMS
  1. Synthetic Put

    A synthetic put is an options strategy where an investor, holding ...
  2. Synthetic

    Synthetic is the term given to financial instruments that are ...
  3. Synthetic ETF

    A synthetic ETF (exchange-traded fund) mimics the behavior of ...
  4. Synthetic Futures Contract

    A synthetic futures contract, or synthetic long future, mimics ...
  5. Synthetic CDO

    A synthetic CDO is a form of collateralized debt obligation that ...
  6. Synthetic Identity Theft

    Synthetic identity theft is a type of fraud in which a criminal ...
Related Articles
  1. Trading

    Understanding Synthetic Options

    Volatility, decay and strike price play a less important role in a synthetic option's outcome than a vanilla option.
  2. Trading

    Put-Call Parity and Arbitrage Opportunity

    These trades are profitable when the value of corresponding puts and calls diverge.
  3. Trading

    Trading Volatility? Don’t Trade Stocks, Trade Options

    During times of volatility, traders can benefit greatly from trading options rather than stocks. We explain why.
  4. Tech

    Investopedia's Top Trending Terms of 2016

    A look at the biggest anxieties and concerns of an event-filled year through surges in traffic to these financial terms.
  5. Investing

    Heat Biologics Lung Cancer Drug Combo Succeeds

    Heat Biologics lung cancer drug led to a reduction in tumor size, spiking the stock price by 35%.
  6. Investing

    The Goldman Sachs Accusation Explained

    Despite the airtime this scandal has received, the details aren't clear. Find out what happened and how it affects you.
  7. Investing

    Why Organic Food Is So Expensive

    Discover how organic farmers face many obstacles. Learn why your organics cost so much more than conventional foods and if there is any hope for falling prices.
  8. Insights

    Is Organic Really Worth The Extra Money?

    It's the shopping decision that seems to pit thrift against family health. Find out when buying "organic" matters most.
  9. Investing

    Metatrader 5 Adds New Features

    The feature-rich MetaTrader 5 has added enhanced capacity for synthetic symbols and a new back end that combines forex and crypto processing.
RELATED FAQS
  1. Biotech vs Pharmaceutical company

    Though biotech and pharmaceutical companies share similar business features, there also have differences. Here, we'll distinguish ... Read Answer >>
  2. How did the ABX index behave during the 2008 subprime mortgage crisis?

    Read about the disastrous performance of the various ABX indexes in the subprime mortgage crisis of 2008 during the middle ... Read Answer >>
  3. Which economic factors most affect the demand for consumer goods?

    Understand how key economic factors such as inflation, unemployment, interest rates and consumer confidence affect the level ... Read Answer >>
  4. What's the difference between outsourcing and insourcing?

    Discover some of the major differences when deciding between outsourcing and insourcing for an organization. Learn how work ... Read Answer >>
  5. Who are Whole Foods' main competitors?

    Whole Foods' main competitors are Sprouts Farmers Markets and Trader Joe's. However, the recent acquisition by Amazon may ... Read Answer >>
Hot Definitions
  1. Intrinsic Value

    Intrinsic value is the perceived or calculated value of a company, including tangible and intangible factors, and may differ ...
  2. Current Assets

    Current assets is a balance sheet account that represents the value of all assets that can reasonably expected to be converted ...
  3. Volatility

    Volatility measures how much the price of a security, derivative, or index fluctuates.
  4. Money Market

    The money market is a segment of the financial market in which financial instruments with high liquidity and very short maturities ...
  5. Cost of Debt

    Cost of debt is the effective rate that a company pays on its current debt as part of its capital structure.
  6. Depreciation

    Depreciation is an accounting method of allocating the cost of a tangible asset over its useful life and is used to account ...
Trading Center