Team:Cornell/Business

Business Cost Analysis

We have created a system in which products can be created continuously instead of large batches. The following is an analysis of how our system matches up with current industrial standards.

Capital Expenditure

Batch production processes has an advantage over our system in that it requires less capital and has a better economy of scale. Our system presents a linear economy of scale since to create more product, we need to run chips in parallel. Batch production has a near-logarithmic economy of scale since producing each extra unit of product costs less up to a reasonable point.

Operating Expenditure

Batch production has a lower cost of operation for relatively cheap bio-pharmaceuticals. However, operating cost can climb steeply if the yield is lowered or quality is important. For most expensive pharmaceuticals, a subset of the following factors generally will raise cost:

1. Presence of side reactions, where resources are used to produce unwanted products instead of the target product.
2. Toxic intermediates can often kill the host cell.
3. Pharmaceuticals are created intracellular. In order to get the products, companies must lyse the cell and purify out the products. About 50% of the cost of creating intracellular pharmaceuticals is in the cost of purification. There are often 5-7 steps required in purification to remove all cell lysate including organelles, other cell junk, other proteins, DNA, etc.
4. Quality factors, such as pH, temperature, concentration, etc., must be tightly controlled.
   1. Different factor values are needed for different parts of the overall reaction. For example, if a pH of 5 is needed for the first step and then a pH of 8 is needed for the second step. Cells have a hard time with these reactions.
   2. Quality factors must be at a very specific value. Since mixing in a batch-processing is not perfect and the solution is not completely homogenized, and often you get different values (of concentration, pH, etc.) at different locations.

How our systems solves the previously states problems often found in batch processing:

1. In the cell, a wide variety of enzymes can often contain pathways for the creation of other products that reduces the yield of the target pharmaceutical. We avoid side reactions because our system only includes the enzymes for a single biochemical pathway.
2. Once the microfluidic chip is coated, there will be no need of cells. Therefore, toxic intermediates in the biochemical pathway are not a factor.
3. Purification of our system would be much cheaper than what is used in industry. There will a some intermediates in our solution since we will not be able obtain 100% yield, but our method still eliminates most steps in the purification process.
4. 1. Our system allows us to having different quality factor values at each step, because each step occurs in a different microfluidic chip. For example, we can have different pH or temperature in each chip. Therefore, in this scenario, our process would have much higher yield than the batch process.
   2. Since we have only a small volume of reactions at a given time, we have a more homogenized solution and can control quality factors much more closely than what can be done in large batches.