Biotech beauty giant Amyris files for bankruptcy with plans to sell off US-based consumer brands

11 Aug 2023 --- Synthetic biotechnology pioneer Amyris has filed for bankruptcy in the US, announcing plans to continue operating its consumer brands after they are sold off through retail partners and e-commerce platforms. The company announced that it is moving forward with an operational and financial restructuring to “further advance its ongoing strategic transformation.” 

Amyris has secured a US$190 million financing commitment from an entity affiliated with existing lender Foris Ventures to support day-to-day operations.

In a filing with the Delaware bankruptcy court, the company – which specializes in precision fermentation to sustainably create “rare and endangered beauty molecules” – listed estimated assets in the range of US$500 million to US$1 billion and liabilities in the range of US$1 billion to US$10 billion.

“Since its founding 20 years ago, Amyris has been a pioneer in the development of ingredients made with synthetic biology and has enjoyed great commercial success, particularly as a result of our innovative Lab-to-Market technology platform, proven ability to rapidly bring new products to market, and state-of-the-art science and manufacturing infrastructure,” says Han Kieftenbeld, interim CEO and CFO of Amyris.

“Over the past months, we have been hard at work on a strategic transformation plan to reduce costs, improve operational effectiveness and achieve sustainable growth,” he maintains.

“We believe the step forward our company has taken today puts us on the best path to address our financial challenges and achieve a comprehensive solution.”

Amyris recently launched the textured hair care line 4U by Tia, by actress Tia Mowry, last January (Image credit: 4U by Tia). Portfolio includes celebrity brands
Amyris filed for Chapter 11 bankruptcy protection in the US Bankruptcy Court for the District of Delaware yesterday. Chapter 11 is frequently called a “reorganization bankruptcy,” according to the Administrative Office of the US Courts.

The company’s entities outside the US are not included in the proceedings.

In tandem with this move, Amyris is planning to exit its consumer brands and will begin marketing them for sale, with plans to allow the businesses to continue using Amyris’ science and technology while under new ownership. 

Amyris’ consumer brands that it will continue to operate and sell through e-commerce and retail platforms include clean skin care brand Biossance, which has squalane – a sugarcane-derived alternative to shark-derived squalene – as its star ingredient. 

It also manufactures and sells reality show star Jonathan Van Ness’s haircare line JVN, as well as model Rosie Huntington-Whiteley’s makeup label Rose Inc and actor Naomi Watts’s menopause-oriented beauty label Stripes.

Amyris made its debut with a US$42 million grant from the Bill and Melinda Gates Foundation in 2003 to craft a molecule to treat malaria.

In March 2021, Amyris purchased Costa Brazil, the brand focused on clean beauty and wellness established by Brazilian designer Francisco Costa, who previously was Calvin Klein’s creative director. 

Additionally, in April 2022, the company acquired Onda Beauty, the clean beauty retail venture co-founded by Watts.

It recently launched actor Tia Mowry’s textured hair care line 4U by Tia in January.

Fulfilling wages and vendor payments
Aside from customary motions seeking to continue operating as usual, Amyris’ bankruptcy filing cited its “commitments to its employees and other stakeholders” throughout the process. 

These “first day” motions include requests to continue to pay wages and provide benefits to employees as usual and maintain its customer programs and policies. 

Amyris manufacturers the brand Rose Inc by model Rosie Huntington-Whiteley (Image credit: Rose Inc).The company intends to pay vendors in the ordinary course for all goods received and services rendered after the filing.

Job cuts and cost trimming
In June, Amyris announced it was cutting jobs to reduce costs and appointed Kieftenbeld as interim CEO, following the resignation of John Melo. The business also initiated a “strategic transformation program” in the same month and secured a term loan facility of up to US$50 million.

Last April, the company disclosed its process of a strategic review of all aspects of its cost structure, with the objective to accelerate cost and efficiency improvements.

“Our strategy to focus our portfolio, reduce our cost base, expand our strategic partnerships and to divest non-core assets is designed to self-fund our business operations,” commented Melo at the time.

“Our liquidity plan includes significant cost savings, attaining the estimated US$335 million of earnouts and milestone payments over the next three years from current strategic agreements and executing on an estimated US$200 million from additional transactions this year.”

By Benjamin Ferrer