The article is long, divided into two parts, the first and the second, this is the first part.

Abstract:

        Synthetic biology is an emerging multidisciplinary frontier branch of biology, which introduces standardization, modularity and other engineering concepts into biology, and continuously broadens and deepens human scientific understanding of the laws of life through the deep transformation of living organisms or the construction of artificial life forms. Synthetic biology-based synthetic biotechnology has a wide range of uses and great economic and social value in biochemical, pharmaceutical, food, daily fine chemicals, agriculture and other industries, and is attracting more and more attention and investment from venture capital institutions. The IP risk of core technology of technology startups is an important factor affecting the success or failure of venture capital. Synthetic biotechnology has some domain characteristics due to the limitations of human scientific cognition and the current situation of rapid development, which should attract the attention of venture capital institutions. In this paper, we firstly review the development status of synthetic biology and its industrial technology and the related venture investment situation at home and abroad, then outline the corresponding investment risks based on the analysis of the general scientific contradictions faced by synthetic biotechnology, and then discuss some IP risks with characteristics of this technology field according to the different stages of venture investment.

Contents:

Characteristics and Response of Synthetic Biotechnology Intellectual Property Risks from the Perspective of Venture Capital (Previous)

Preface：

I. Introduction to Synthetic Biology

(A) The meaning of synthetic biology

(B) Industrial application of synthetic biotechnology

II. Status of venture capital investment in synthetic biotechnology

General characteristics of synthetic biotechnology and corresponding investment risks

Citation

The characteristics of synthetic biotechnology intellectual property risk and response from the perspective of venture capital (below)

IV. Characteristics and responses of synthetic biotechnology intellectual property risks in various investment stages

(I) Pre-investment due diligence stage

              1. Characteristics of general risks

              2. Characteristics of patent free implementation risk

              3. Characteristics of patentability risk

              4. Risk of patent application

(II) Post-investment management stage

              1. Characteristics of risks in patent infringement remedies

              2. Risks in patent pools

(III) Timing of investment exit

V. Conclusion

Reference Citation

Preface:

Synthetic biology is a frontier subdiscipline of biology developed since the beginning of this century, whose main feature is to use artificially modified or newly designed Biological Parts (Biological Parts), which refer to biological genetic units with the most basic functions, such as terminators, promoters, RNA binding sites, transcription factor binding sites, etc., to build biological modules and systems with the concept of engineering, in order to transform living organisms or even create new ones. The aim is to build biological modules (Modules) and biological systems (Systems) to transform living organisms or even create new living organisms. Synthetic biology is a product of cross-fertilization of biology, engineering, physics, chemistry, mathematics, computers and other disciplines, and its research results have great economic and social values, affecting many economic sectors such as medicine, food, agriculture, chemical industry and environmental protection. The world's major scientific and technological powers and regions have devoted a lot of attention and support to the development of synthetic biology. Since 2010, China has started to deploy the "Synthetic Biology" theme research under the "973 Program", which has laid an important foundation for the development of synthetic biology in China. In 2018, based on the "973 Program", the Ministry of Science and Technology launched the National Key Research and Development Program "Synthetic Biology" key special project, which focuses on the deployment of "artificial genome synthesis and high version of chassis cells ", "artificial components and gene circuits", "artificial cell anabolic and complex biological systems" and "enabling technology system and biosafety assessment The four main tasks, including "Synthesis and High Version Chassis Cells", "Artificial Components and Gene Lines", "Synthetic Metabolism of Artificial Cells and Complex Biological Systems" and "Enabling Technology System and Biosafety Assessment", cover 11 modules and 47 research directions. At the industrial policy level, from the 12th Five-Year Plan, the "Bio-economy Development Plan" includes synthetic biology in the plan, and in the "14th Five-Year Plan" issued by the National Development and Reform Commission on May 10, 2022, it is even In the "14th Five-Year Plan" issued by the National Development and Reform Commission on May 10, 2022, there is a clear requirement to "promote technological innovation in synthetic biology, breakthroughs in computational design, high-throughput screening, efficient expression, precise regulation and other key technologies of biological manufacturing strains, and orderly promote applications in new drug development, disease treatment, agricultural production, material synthesis, environmental protection, energy supply and new material development.

Venture capital is the capital salary that ignites the fire of science and technology. Synthetic biology technologies have attracted the attention of venture capital because of their high economic value, green, low carbon and broad industry disruptive characteristics. Before 2010, venture capital capital capital in the U.S. had already started relevant investment activities, nurturing a number of well-known early-stage technology companies, such as Amyris, Ginkgo Bioworks, Zymergen (merging with Ginkgo Bioworks in 2022), Bolt Threads, Intrexon, etc.; from 2017 Since 2017, the number of global venture capital events and total corporate funding in this field began to grow significantly and continues to do so today, with global synthetic biology startups raising more than $18 billion in 2021, close to the total cumulative funding in the previous 12 years (2009 to 2020). For example, in January 2022, Bluepha, the earliest synthetic biology startup in China, announced the completion of a Series B3 round of funding totaling RMB 1.5 billion; near the end of 2022, Biohetero announced the completion of a Pre-A round of funding in the tens of millions of RMB. Near the end of 2022, Biohelp announced the completion of tens of millions of RMB in Pre-A round financing; angel round financing amounting to tens of millions of RMB has sprung up.

At present, synthetic biotechnology startups are generally in the early stage of industrial development, and their main asset is their technological intellectual property, which is an important evaluation dimension for venture capital institutions when investigating and valuing the companies to be invested. Risk control has always been an important factor in determining the success or failure of venture capital institutions, and the traditional IP risk control is usually the investigation of IP ownership and risk analysis in the pre-investment due diligence stage. However, synthetic biology, with its deep modification of biological systems and "convergent" innovation, has brought biotechnology to a new historical stage, and the related intellectual property rights have some characteristics compared with previous biotechnology, which brings new requirements for intellectual property risk control and should be paid attention by the venture capital industry.

At the same time, we should not forget the principles of protecting public interest, public safety and moral and ethical principles that are generally followed by the IP legal systems of various countries. For example, Ralph Baric, a professor in the Department of Epidemiology at the University of North Carolina at Chapel Hill, developed and synthesized a new coronavirus similar to SARS in 2005. This patent and the report that a research team from the University of Bern in Switzerland obtained a large number of active novel coronaviruses in vitro by synthetic means in 2020 have both raised public questions about the current patent system and concerns about the proliferation of biological weapons manufacturing technology. It is not clear whether this will lead to future changes in national patent laws. A similar precedent is the U.S. patent law prohibiting the granting of patents on nuclear weapons manufacturing technologies. It is well known that for the sake of human dignity, countries generally prohibit genetic modification of the human embryo genome or the use of human embryos as the basis for inventions, such as the case of He Jiankui, a former associate professor at Southern University of Science and Technology, who was sentenced for the "gene-edited baby" incident. However, the definition of "embryo" is not consistent across countries. For example, the European Court of Justice once cited the Biotechnology Patent Directive 98/44/EC to interpret human egg cells as a "human embryo", while China's Patent Examination Guidelines, Part II Chapter 1, Section 3.1.2 of our Patent Examination Guidelines provides that the use of human embryos that have not undergone in vivo development within 14 days of fertilization to isolate or obtain stem cells cannot be denied a patent on the grounds that it is "contrary to social morality". This difference reminds us that international differences should be taken into account when assessing the moral and ethical risks of biotechnology IPRs, as patents are always exclusive rights with territorial boundaries.

Synthetic biology is complex in its connotation and extension, and is itself in an active stage of development. Due to the limitation of my ability, I do not intend to make a comprehensive and profound discussion on the intellectual property risks of synthetic biotechnology, but only try to sort out some industry-specific intellectual property risks and their corresponding response strategies from the perspective of venture capital at the combination of technology and law.

I. Introduction to synthetic biology

(A) The meaning of synthetic biology

Synthetic Biology is a frontier branch of biology that emerged at the beginning of the 21st century, originally proposed by Barbara Hobom in 1980 to express the technology of genetic recombination, and reintroduced by Eric Kool at the annual meeting of the American Chemical Society in 2000 with the development of molecular biology and systems biology. In 2003, it was defined internationally as the study of artificial biological systems based on genetic engineering and engineering methods of systems biology. Synthetic biology generally includes the artificial design and synthesis of biological layers from genes, gene regulatory components, signaling pathways, metabolic networks to cells, etc. It is characterized by the application of engineering principles and methods to biotechnological fields such as genetic engineering and cellular engineering, and is a cross-discipline of biology, engineering, physics, chemistry, mathematics, computers and other disciplines. Synthetic biology includes two meanings: 1. design and construction of new biological components, biological modules and biological systems, for example, Wang Xiaoyi's group at Tsinghua University successfully realized the design and generation of a new gene promoter in Escherichia coli, and the first artificial genome containing a fully synthetic, self-replicating genome successfully developed by J. Craig Venter, a famous independent biologist in the United States, in 2010. Mycoplasma, Synthia, in 2010; 2. Modification of natural organisms, such as genetically engineered industrial strains for the fermentation and production of various compounds.

Systems biology is the main disciplinary basis of synthetic biology, which is broadly divided into two branches, "bottom-up" and "top-down", according to the research model, in which the "top-down" research idea In contrast, synthetic biology focuses on the synthesis of novel biological components, modules and systems, i.e., it adopts the "bottom-up" forward engineering strategy, which focuses on synthesis and construction. The synthetic biology is concerned with the synthesis of novel biological components, modules and systems, i.e., a "bottom-up" forward engineering strategy that focuses on synthesis and construction. Of course, the two disciplines also use many of the same methods and are closely related. The study of synthetic biology cannot be separated from systems biology, and the study of artificially designed and constructed optimized biological systems can provide new objects and tools for systems biology research and enrich the knowledge of systems biology. Synthetic biology is the next step after systems biology, and the research idea of biology is moving from "analysis" to "synthesis" and from "local" to "overall". On the basis of "analysis" to "synthesis" and "construction" of complex living systems, it is also a higher level of "synthesis" and "construction" of complex living systems after "in situ transformation and optimization". After genetic engineering technology and genome technology based on data acquisition and analysis, biotechnology has risen to a higher level of engineering model design and module manufacturing. The emergence of synthetic biology marks the evolution of modern biology from "top-down" to "bottom-up" "building The emergence of synthetic biology marks the evolution of modern biology from the "top-down" "material knowledge" to the "bottom-up" "construction" and "unity of knowledge and action" stage.

Although synthetic biotechnology is based on genomic technology as the core biotechnology, similar to the engineering of traditional biotechnology based on genomic knowledge, it is not an imitation of natural genes like traditional biotechnology, but a verifiable technology that can synthesize complex living systems from scratch. Synthetic biology has introduced a rigorous engineering mindset in biology, which was previously lacking, by borrowing the technical ideas of designing and manufacturing Integrated Circuits in the field of Electronic Engineering, and a lot of research activities and results on Gene Circuits emerged in the early development of the discipline. A large number of research activities and results on Gene Circuits emerged early in the development of the discipline. These gene circuits mimic the functions of electronic circuits, with various types of logic gates, transfer switches, bistable switches, etc. Thus, in the early stages of development of synthetic biology, the engineering concepts of standardization, modularity, and decoupling became the consensus within this scientific community. Synthetic biotechnology has three basic elements: first, the use of standardized biological components isolated from nature, identified by human characterization, which can be modified, recombined or even designed and created; second, the design of biological networks and even regulatory devices based on the knowledge of genome and systems biology, and the rational recombination and design of modules; third, the use of modern biotechnology and related physical and chemical knowledge and techniques Thirdly, the use of modern biotechnology and related physical and chemical knowledge and techniques to artificially design and build optimized biological systems, and even to obtain new living organisms.

Since the beginning of this century, synthetic biology has progressed rapidly, and the mainstream of research has rapidly evolved from the design of standardized biological components to the integration of multiple biological components and modules, the establishment of complex biological systems through the design of coordinated operation between multiple modules, and the fine regulation of metabolic network flow, so as to build a "cell factory" ( Cell Factory" to realize the mass production of drugs, compounds, functional materials and energy alternatives.

(B) Industrial applications of synthetic biotechnology

The use of synthetic biology methods and theories, the targeted design, modification and even resynthesis of biological processes or organisms to create new biological tools such as microorganisms, cells and proteins (enzymes) to solve problems in energy, chemicals, biomedicine, agriculture, materials, etc. will bring a new wave of technological revolution, which has long-term strategic significance and realistic significance for solving major biotechnology problems related to the people's livelihood. strategic significance.

In recent years, due to the influence of world oil resources, price, environmental protection and global climate change, the idea of applying synthetic biology to the field of energy has also emerged. The United States, the European Union, Germany and the Netherlands have invested a significant proportion of the funds in synthetic biology research in bioenergy. For example, the U.S. company Dupont has synthesized 1,3-propanediol, an important industrial raw material, using E. coli bacteria; the energy density of farnesene derivatives is much higher than that of No. 3 aviation kerosene, which can be used as fuel additives to significantly improve its performance and effectively extend the range and increase the bomb load, which has important military and strategic significance. Amyris, a pioneer of synthetic biology in the United States, has reduced the price of farnesene by more than 95% by directly converting sugar into farnesene through synthetic biotechnology.

The use of synthetic biotechnology for chemical production has the strategic advantages of being green, energy efficient, and renewable raw materials. Synthetic biotechnology uses artificial biological components to modify microbial metabolic pathways, thus achieving efficient conversion of low-value carbohydrates such as starch and glucose into high-value chemical products that are synthesized with low efficiency in natural microorganisms; synthetic biology can even design biochemical reactions and anabolic pathways that do not exist in nature, and efficiently synthesize molecules that cannot be synthesized by natural microorganisms, including new artificially designed molecules. Currently, humans have been able to produce many fine chemicals, food additives and pharmaceuticals using synthetic biotechnology, such as amino acids (lysine, alanine, etc.), organic acids (succinic acid, malic acid, etc.), aromatic compounds (levodopa, caffeic acid, ferulic acid, etc.), terpenoids (squalene, artemisinin, ginsenosides, etc.), sugar-substituting sweeteners (allulose, stevia, etc.), etc.

These biologically manufactured compounds are particularly commercially promising in the health and food sectors. In nature, for example, artemisinin, an endoperoxide of sesquiterpene esters produced by Artemisia annua, is recommended by the WTO as the drug of choice for malaria, but is produced in very low quantities in nature. Chemical synthesis of artemisinin is difficult and costly, leaving artemisinin in short supply and preventing many patients from receiving timely treatment. After 10 years of research by Professor J.D. Keasling's group in the United States, the yield of artemisinic acid per unit cell was increased by a factor of 1 million and the cost of the drug per dose was reduced from $10 to less than $1. For this research, Keasling was selected as one of the most influential scientists of 2006 by the American magazine "Discovery". Through years of efforts, our researchers have opened up the biological manufacturing routes of ginsenosides, steviosides, rhodiosides, asparagine, calendula, lycopene, β-carotene, salvia new ketones and aromatic substances of roses and jasmine, and other natural products of medicinal plants and economic plants, and the production efficiency has been greatly improved. With the current technology level, the synthesis capacity of ginsenoside in 1000 m2 workshop is equivalent to 6.7×107 m2 ginseng planting, the synthesis capacity of lycopene in 1000 m2 workshop is equivalent to 4×107 m2 agricultural planting, the cost is 1/4 of plant planting extraction, the cost of asparagine biosynthesis is 1/200 of plant extraction, and the quality can completely replace chemical synthesis.

Long-chain dibasic acid is an important basic industrial product, mainly used in the synthesis of polymer materials (nylon), in recent years, also in the spices, drugs, paints and other industrial manufacturing applications. The bio-based long-chain dibasic acid produced by Kaiser Bio, a listed company in China, currently holds a dominant position in the global market. Polyhydroxy fatty acid ester (PHA) is a fully degradable bioplastic that has been a dream material for scientists for nearly 100 years, but the high cost of chemical synthesis has long limited its application. With the advancement of synthetic biotechnology, the biosynthesis of PHA is expected to successfully achieve mass production. China's synthetic biology startup Microstructure Works has completed the efficient production of a 1,000-ton PHA demonstration line and has started the construction of a 30,000-ton per year PHA production base.

Synthetic biotechnology can significantly improve the efficiency of agricultural breeding. Compared with traditional crosses and early molecular breeding methods, researchers can use advanced synthetic biology tools to make rapid, precise, and complex modifications to crop genomes to achieve goals such as improving yield and resistance, increasing beneficial nutrients, and reducing the risks associated with uncertainty in the traditional breeding process, for example, Zhu and Nagvi et al. successfully obtained β-carotene-rich maize plants by introducing a combination of metabolic pathways consisting of multiple genes and promoters in maize. Through synthetic biology approaches, it is now possible to provide feed additives such as probiotics and enzymes for livestock and fishery animals to improve feed conversion efficiency or to add specific nutrients to the product. DuPont has obtained strains rich in EPA and DHA through a substantial modification of the genome of the oil-producing yeast Yarrowia Lipolytica and used them as feed additives to increase the content of beneficial fatty acids in salmon oil.

According to the World Organization for Economic Cooperation and Development (OECD) projections, the share of bio-based chemicals and other industrial products (excluding biomedical products) in the total chemical production is expected to increase to 35% by 2030. Synthetic biotechnology can help human beings meet the serious challenges faced in social development, thus fundamentally changing the economic development model and promoting stable and harmonious development of society while bringing great social wealth.

II. Status of venture capital in synthetic biotechnology

Synthetic biology is widely recognized as the "third revolution in biotechnology" after genetic engineering and second-generation sequencing (NGS). Governments and non-profit organizations were among the first to invest in synthetic biotechnology, for example, in 2004, synthetic biology pioneer Professor Keasling received a $42.6 million grant from the Bill and Melinda Gates Foundation to develop microbial synthesis of artemisinin. . Since then global venture capital capital started to pay attention to this field, forming a small climax of investment from 2013 to 2015, and after a short period of calm, more and more investment institutions joined in, and the total annual investment amount from the second half of 2017 continued to go up. As shown in Figure 1, according to SynBioBeta, a leading U.S. synthetic biology community, global synthetic biotech startups will raise more than $18 billion in 2021, which is close to the total cumulative funding over the previous 12 years (2009 to 2020). At the same time, as shown in Figure 2, individual investment amounts are also growing.

Figure 1. 2009-2021 Synthetic Biology Venture Investment Amounts

(Source: SynBioBeta, 4Q 2021 Synthetic Biology Venture Investment Report. 2022)

In China's capital market, the synthetic biology venture investment activity has entered an active period, marked by the landing of Kaiser Bio in August 2020 as the first synthetic biology stock on the science and technology innovation board, for example, in July 2021, Bota Biosciences, a synthetic biotechnology platform company, announced the completion of over $100 million in Series B financing; in January 2022, High Tide raised over $100 million with In March 2022, State Creative Biologics completed its fourth round of financing with a cumulative funding of over USD 100 million; in May 2022, Weiyuan Synthesis announced the completion of an angel round led by Matrix Partners for nearly RMB 100 million; in June 2022, Yanwei Technology announced the completion of a RMB 50 million angel round led by Sequoia China and Fengrui Capital. In June 2022, Diffractive Technology announced the completion of a RMB 50 million angel round led by Sequoia China and Peak Capital. 

Figure 2. Average deal value and number of investment events in synthetic biology venture capital, 2009-2021

(Source: SynBioBeta, 4Q 2021 Synthetic Biology Venture Investment Report. 2022)

Synthetic biology is a cross-fertilization discipline with a wide range of technologies and applications, making it a very diverse industry track. According to the classification of core technologies, the whole synthetic biology industry can be divided into upstream, midstream and downstream, among which, the upstream technologies are called enabling technologies, including nucleic acid/gene synthesis, gene editing, biological component libraries, various types of histology technologies, and bioinformatics and artificial intelligence, which are not only the upstream technologies of synthetic biology, but also the underlying technologies of all modern biotechnology. They are not only the upstream technologies of synthetic biology, but also the underlying technologies of all modern biotechnology; midstream technologies are platform technologies for designing and developing biological components or organisms, such as protein directed evolution technology platforms and automated strain R&D platforms; downstream technologies mainly involve the construction of specific artificial organisms and biomanufacturing processes of specific products by applying upstream and midstream technologies. In the early stage of the development of synthetic biotechnology industry, VCs preferred to make large investments in upstream enabling technologies and midstream platform technologies, such as Twist Bioscience, DNA script, Ginkgo Bioworks, Zymergen, etc., with the intention of strategic deployment in the upstream of the industry. However, after a period of technology and business model exploration, these upstream and midstream technology companies have not yet developed their own profitability, which has undermined market confidence, and even some listed head companies have undergone M&A restructuring, such as Ginkgo Bioworks' acquisition of Zymergen. Many of these companies are now actively exploring application-specific technologies, either independently or in partnership with large traditional companies. Investors are also recognizing that without concrete products on the ground, companies cannot develop real business value, which is not conducive to the sustainability of the industry. As shown in Figure 3, according to SynBioBeta, synthetic biotechnology companies in the application category received the largest share of investment in 2021, accounting for approximately 77.4% of total annual investment, with midstream companies in the engineered strain R&D platform category receiving approximately 14.8% of investment, and the remaining less than 10% share going to gene/genome synthesis and sequencing, BioCAD, and cloud lab/automation Upstream technology companies received. 

 Figure 3. Share of investments received by synthetic biology companies of different technology types, 2021

(Source: SynBioBeta, 4Q 2021 Synthetic Biology Venture Investment Report. 2022)

The general characteristics of synthetic biotechnology and the corresponding investment risks

The great gap between the "infinite" nature of biological phenomena and laws and the limited nature of human knowledge of them is a long-standing paradox of synthetic biotechnology, which poses a risk to the commercial value of the technology. To date, reductionism, based on the theories created and developed by Democritus, Galileo, Bacon, Newton, Descartes, and others, has gradually become the dominant paradigm of modern science. The latest Encyclopedia Britannica defines reductionism as "in philosophy, the idea that a given entity is a collection or combination of simpler or more basic entities; or that the representation of these entities can be defined on the basis of the representation of more basic entities". Reductionism holds that the whole can be broken down into parts, that higher levels can be reduced to lower levels, and that things can be understood from large to small, from top to bottom, and from shallow to deep. Modern biology is following the reductionist thinking to deepen the understanding of living things, and the level of understanding of living things is decomposed from the whole to organs, tissues, cells, organelles, until proteins, nucleic acids and other biological molecules, and finally the essence of life is explained as some series of biochemical reactions occurring within cells and biophysical phenomena among biological molecules. For example, even if the genome of an organism is fully sequenced, the causal relationship between a large number of single nucleotide polymorphism loci (SNPs) in the non-coding region of the genome and the biological phenotype cannot be explained, and the correlation can only be found by means of big data; in medicine, it is found that The response of individual tumor patients with the same mutated locus to the same targeted drug also varies greatly. The emergence of systems biology, one of the foundations of synthetic biology, marked the beginning of systems theory as a new paradigm for biological research. The level of knowledge of the whole is still limited to "snapshot" or "real-time" continuous observation of a part of the biological system. Synthetic biology as a science adopts a new concept of "bottom-up", according to the philosophy of system theory, from the design of the parts to the assembly of the whole, emphasizing the optimization of the system, the whole is greater than the sum of the parts, and deepening the understanding of the whole biological system through the study of artificially constructed biological systems, so as to achieve "As an emerging discipline, its task will be long-term; and the goal of synthetic biotechnology as a technology is to purposefully use the natural laws of biology to transform biological materials and construct living organisms that meet human needs. First, in the current scientific environment, synthetic biotechnology is limited in the number of natural laws that can be generated by the systems theory concept; second, the standardized artificial biological components used in synthetic biotechnology and the artificial gene circuits constructed using them are simplifications of the natural gene structure, especially the understanding of the means of characterization and genotype-phenotype relationships of the artificial biological components is still very incomplete, and the inventors of the technology have no idea of how the artificial gene The inventors of the technology do not have a comprehensive understanding of how the artificial genetic circuits operate in the chassis organism and what kind of impact they have on the biological system. Even the genome of Synthia, the world's first "fully synthetic genome" artificial organism invented by the J. Craig Venter Institute, is only a streamlining based on the genome of the natural microorganism Mycoplasma filiformis, which is bound to suffer from information loss and mismatch with the original system. Therefore, humans will inevitably face considerable uncertainty to manipulate complex biological systems using limited biological knowledge and simplified engineering concepts.

Technology is one of the major factors determining the success or failure of early stage operations of technology start-ups, and technological intellectual property is currently an important dimension to examine for venture capital investments in synthetic biotechnology. The uncertainty of synthetic biotechnology poses a risk to the commercial value of its IP, and the rapid advances in contemporary systems biology and synthetic biology will further exacerbate this uncertainty. The IP risks faced by synthetic biotechnology venture capital are mainly reflected in three aspects.

1. New life phenomena and laws discovered by basic research will overturn the sophistication of existing technologies. For example, as early as 1987, scientists stumbled upon the existence of highly homologous repetitive sequences containing 29 bases at the 3' end of the E. coli gene iap, which were spaced apart by sequences containing 32 bases. After more than 20 years of continuous research, it was finally clarified that this is an ancient mechanism of bacterial defense against exogenous gene invasion. Soon after the basic research results appeared, biologists immediately began to use this biological mechanism for gene editing, and since then, the famous Cluster Regularly Spaced Short Palindromic Repeats (CRISPR)/Cas nuclease technology was born. The commercial value of the artificial nuclease-mediated zinc finger nucleases (ZFN) and transcription activator-like effector nucleases (TALEN), which emerged shortly before its birth, rapidly decreased.

2. The complexity and diversity of biological systems allow for a variety of potential alternative technologies for a synthetic biotechnology. The construction of an artificial metabolic pathway includes the screening of biological components, the design of gene expression intensity and timing, the control of metabolic flow, etc. The combination of different factors can be mathematically viewed as the solution of a polynomial equation, and without a comprehensive understanding of the biological system, a commercially available metabolic pathway is actually only a local optimal solution, while the global optimal solution may never be reached. In this way, as understanding of biological systems continues to grow and expand, it is almost inevitable that solutions with better industrial performance than current locally optimal solutions will be discovered through biological experiments. Perhaps these new metabolic pathway designs still fall within the protection of prior patents, but we cannot theoretically exclude the emergence of other competing technologies that are novel, inventive and useful. Although the protection period of patents in various countries is generally 20 years, in the current technological environment of rapid advancement in biotechnology, investment institutions should probably be rational in shortening the depreciation period of patent value. For the examination of a company's core technology, in addition to the commercial value of intellectual property rights, we should also examine the technical iteration capability of the technical team, which is probably the dimension that determines whether a company can maintain its technological leadership. The key.

3. Given the limitations of human understanding of biological systems, we cannot be sure of the potential safety threats of artificial organisms, such as early virus-based gene therapy technologies that have been known to cause cancer in patients receiving treatment. What are the consequences of a leak of a genetically engineered microorganism with unknown pathogenicity for industrial use? Another extreme case is the reported transformation of the sperm genome of a patient receiving an allogeneic bone marrow transplant into the donor's genome, but what if the transplant in this case was of artificially modified stem cells? It can be seen that there are also potential ethical issues with synthetic biotechnology.

In the following paper, we will discuss some characteristics of synthetic biotechnology IPR risks at various stages of investment and ideas for responses from a venture capital perspective.