TheChek News Flow

The beauty giant was part of a funding round that raised 35 million euros for Abolis Biotechnologies.>

PARIS – L’Oréal has participated in a 35-million-euro funding round for French biotech company Abolis Biotechnologies in the quest to create purpose-made, sustainable ingredients produced at scale.

The minority investment was made through Business Opportunities for L’Oréal Development, or BOLD, the group’s venture capital fund. The deal is part of a three-way partnership. Evonik CVC, a global specialty manufacturer that’s a longstanding partner of L’Oréal, has also taken a minority share in Abolis, while other investors include Deep Tech & Climate Fund, Clay Partners, Icos Capital and Liberset.

L’Oréal, Abolis and Evonik will together aim to discover, develop and manufacture innovative, sustainable ingredients for beauty products and more.

For L’Oréal, the tie-in is meant to help step up the company’s sustainability commitment, a key part of its strategy for 2030, called L’Oréal for the Future. That includes a heightened focus on bio-based ingredients for its formulas.

“By mobilizing our respective companies’ research, innovation and manufacturing capabilities and expertise, we are building an end-to-end value chain that we believe has tremendous potential to be a game-changer in bio-based ingredients for beauty,” said Barbara Lavernos, deputy chief executive officer in charge of research, innovation and technology at L’Oréal, in a statement, of the triumvirate.

“We’re going to embrace all the key elements of the value chain to bring science and biotechnology to life,” continued Frédéric Legrand, who heads up the international innovative ingredients department advanced research, L’Oréal R&I, in an interview. “Each of the partners will come with its own expertise to make this happen with a common ambition.”

Science is at the core of L’Oréal’s model, said Legrand. The group has 4,000 researchers in multiple disciplines and 20 research centers in 11 countries worldwide. The company invests more than 1 billion euros in research and innovation yearly.

“Green sciences are a lever for us to achieve the [L’Oréal for the Future] ambition. Biotechnologies are at the core of this strategy,” said Legrand, adding they can enable the group to develop both green alternative ingredients for the company’s portfolio and to rethink completely the production model for ingredients. Concurrently, biotechnology enables L’Oréal to push the boundaries of ingredient territories it can reach to achieve the goal of creating beauty that moves the world while respecting planet Earth.

“Open innovation is at the core of our strategy – especially when you talk about biotechnologies,” continued Legrand, describing that as a wide territory for sustainable innovation.

To wit: L’Oréal has launched the L’Oréal Green Sciences Incubator for startups, partnered with Dutch biotech concern Micreos and invested in companies such as Microphyt and Debut Bio, among many others.

Abolis, based in a biocluster called Genopole, in Évry-Courcouronnes, France, has collaborated with L’Oréal since 2019, including on an extended lab set up three years later.

Abolis has an expertise in made-to-measure industrial solutions based on microorganisms for cosmetics, healthcare and nutrition, among other industries. Together with L’Oréal, it has been working to develop not only new ingredients to offer sustainable alternatives to the group’s current portfolio of raw materials, but also to open different areas of innovation that today are not accessible through traditional chemistry.

“Our ambition as a tripartite [grouping] is really to be as broad as possible in terms of application,” said Legrand. That includes biological actives for skin, scalp or hair care, for instance.

“This is where we push the boundaries in terms of performance,” he said. “But not only, the beauty of biotechnology is that you can also reach a range of molecules – raw materials that we call functional ingredients – that are also very important for beauty.”

Those can positively impact on the likes of product sensoriality.

Abolis made the fundraise for three main reasons – to scale, especially its operations and commercial activity worldwide; to start developing proprietary processes, and to grow its microbiome studio business unit with applications such as nutrition, health and skin care, and biocontrol.

Abolis’ successful collaboration with L’Oréal already spans several projects.

“With this new tripartite agreement with Evonik, we really want to go even one step further with more products and ingredients to be jointly developed by L’Oréal, Evonik and ourselves,” said Cyrille Pauthenier, CEO of Abolis, who explained his company comes to play, for example, when a molecule is too complex to be created chemically or has to be rejuvenated with a bio-based, sustainable alternative.

“We take the molecule and transform it into something that can be a viable at-scale production process,” he said, adding the beauty of collaborating with Evonik is its ability to scale up chemical engineering, industrialization, production and distribution of sustainable solutions. It is already a major provider to L’Oréal.

Some molecules produced will be exclusive to L’Oréal and others will be for broader use. An important active in the cosmetics space might be used in food supplements and animal feed, for example.

Pauthenier sees significant opportunities for biotech ingredients.

“There is a lot more to do,” he said, explaining the possibilities stretch wide – past skin care. “That’s obvious. But there are things in colors for hair and makeup, for instance…that can have tremendous positive impact on the final product.”

Pauthenier lauded L’Oréal for its “strong, transformative drive” being brought to the ingredient industry at large.

“It goes beyond beauty,” he said.

London-based company looks to expand luxury offerings as art market weakens

Christie’s has agreed to buy classic car auction company Gooding and Company, in a move that will diversify its offerings as the art market weakens.

The auction house, which is owned by Artémis, the holding company of the Pinault family, on Thursday said the purchase “marks a significant milestone for Christie’s, establishing its position in the rapidly expanding classic and collector car market”.

Guillaume Cerutti, chief executive of Christie’s, told the Financial Times the auction house is making the acquisition at a time when its “luxury divisions have increased a lot”, thanks to an influx of new collectors, particularly in Asia. Many customers “who collect art or other luxury items . . . also collect cars”, he added.

It will bring the auction house back to the classic car market, which it exited in 2007, although it has continued to sell cars as part of specific collections, such as a Bentley once owned by singer Elton John that was sold for $441,000 earlier this year.

Gooding and Co was founded in 2003 by married couple David Gooding and Dawn Ahrens. Among the cars sold recently by Gooding are a 1995 McLaren F1 sold for $20.47mn in 2021 and a 1970 Porsche 917K, which sold for $14.1mn in 2017.

Gooding, who is president of his eponymous auction house, once worked at Christie’s. His company has in the past partnered with the luxury items broker on car-related projects and delivered valuations for cars in client collections, Cerutti said.

The Christie’s chief did not disclose the value of the deal, although he said it is the auction house’s biggest in two decades. It is expected to close before the end of 2024.

François-Henri Pinault, who chairs Artémis, said: “The ambition and values of David Gooding, and his team, align perfectly with those of Christie’s. They also correspond with those of the other businesses in which the Pinault family has long been invested, in the fields of art and culture, luxury, and lifestyle.”

The acquisition comes at a challenging time for the auction industry. Christie’s reported a 22 per cent year-on-year decline in auction sales for the first half of 2024. Less than a month ago rival Sotheby’s also announced an 88 per cent drop in its first-half core earnings and a 25 per cent fall in auction sales.

Northvolt shows Europe’s battery makers face make-or-break moment

Measures to help manufacturers already exist; they just need to be implemented

Europe is in danger of losing a key “green” manufacturing industry to Asia. Sound familiar? This time it is Europe’s nascent battery industry that is facing a shaky future. Slowing electric car sales are adding to existing problems, such as cheap battery imports from an oversupplied China.

As European automakers scale back their electric vehicle plans, Benchmark Mineral Intelligence is forecasting nearly 14 per cent lower demand in Europe for cells in 2030 than it was a year ago.

Battery makers have responded by delaying or cancelling their own projects. Northvolt of Sweden, Europe’s leading domestic battery hope, said this week it would cut jobs and trim other activities to focus on its first gigafactory in northern Sweden. Volkswagen’s battery business PowerCo is among others that have moderated ambitions.

The worry is that current conditions scupper domestic European companies’ chances of challenging the dominance of Chinese and South Korean battery makers. This feels like a “make-or-break” moment for the homegrown industry.

True, the hype a few years ago around fleets of new gigafactories in Europe was always destined to deflate. Building and scaling up gigafactories is complex and highly capital-intensive. Many start-ups did not have sound business models — or even the technology or supply chain sourcing plans, says Sam Adham at CRU.

The approach of failed UK company Britishvolt of “build and they will come” — pressing ahead with a factory before securing sufficient orders — was always dubious, for instance.

Most western battery groups have concentrated on longer-range battery chemistries. Yet automakers are increasingly open to using shorter-range but cheaper LFP (lithium iron phosphate) batteries from Chinese companies.

There are, of course, different interpretations of “domestic”. Many of the biggest Asian battery manufacturers, such as China’s CATL and South Korea’s LG Energy Solution, have manufacturing facilities in Europe. In 2023, 64 per cent of the batteries sourced for European-built EVs were from facilities in Europe, according to CRU.

But Europe has reached similar critical moments before in other green technologies and consistently lost. Solar panel manufacturing shifted to China from the 2000s onwards. Such inflection points often spur calls for greater subsidies or trade tariffs.

Higher levies have already been imposed on EV imports from China. But there are existing tools to help domestic battery makers, argues Julia Poliscanova of Transport & Environment. They just need to be implemented or distributed faster: for instance, a €3bn battery fund announced last year, or carbon footprint requirements that would reward local manufacturing.

EV sales growth will return. Domestic European battery start-ups are unlikely to overtake their powerhouse Asian rivals. The question is which can manage to survive this sticky period to carve a place in the global market.

Commission dismisses offers to adjust pricing of allegedly subsidised vehicles

The European Commission has rejected offers by Chinese electric-vehicle makers to adjust their prices in a bid to avoid sharply higher tariffs ahead of potentially pivotal talks between Beijing and Brussels next week.

The tariffs were announced after a months-long probe launched by commission president Ursula von der Leyen that sharply increased trade tensions between the 27-member bloc and China, the world’s second-biggest economy.

EU officials have said the tariffs are needed to protect European manufacturers from being undercut by low-cost, China-made EVs that it says are unfairly subsidised by Beijing.

Olof Gill, the commission’s trade spokesperson, said on Thursday the commission had rejected “offers for price undertakings” by several Chinese auto exporters, but that Europe remained “open to a negotiated solution”.

“Our review focused on whether the offers would eliminate the injurious effects of subsidies and could be effectively monitored and enforced. The commission has concluded that none of the offers met these requirements,” he said. The price offers were confidential.

EU member states will vote on the Chinese EV tariffs by the end of October.

The decision to refuse the Chinese carmakers’ offers comes amid signs of growing divisions within the bloc over China in the wake of fears of a costly tit-for-tat trade war.

China’s commerce minister Wang Wentao will meet the EU trade commissioner Valdis Dombrovskis in Brussels next week.

Gill said it was up to China to find a solution to the EVs dispute that would address the risk of injury to EU industry that the investigation identified. “It’s not up to the commission to be prescriptive about what that solution looks like,” he said. “We are open to negotiation. Over to them.”

The EU has proposed imposing tariffs on China-made EVs of up to nearly 50 per cent, following a US decision to raise tariffs to nearly 100 per cent.

On Wednesday, Spanish Prime Minister Pedro Sánchez said his country was “reconsidering” its position on the EU tariffs. The change in stance moved Spain into line with Germany, which has been lobbying member states to oppose the measures.

China has slammed the proposed tariffs as a sign of rising western protectionism that undermines the global fight against climate change.

Yi Xiaozhun, a former Chinese ambassador to the World Trade Organization, told the Financial Times he still hoped there would be a negotiated settlement.

“In China, nobody wants to see a trade war. I think China is trying its best to avoid it and the US is even tougher for China to deal with. And we do hope that the EU will not join this kind of unilateral protectionism to push China to go through a trade war,” he said.

Since Brussels’ investigation, Beijing has also opened anti-dumping probes into European dairy products, cognac and pork, and has filed a complaint with the WTO. The response has highlighted China’s willingness to hit back against sensitive interests in key EU member states.

Asked if the investigations into EU imports were a result of the EV tariffs, Yi said there was no “direct link”.

“But here is the thing: you need to have a business-friendly bilateral relationship. Otherwise you will get tit-for-tat actions,” he said.

Bill would allow FDA to fine individuals, companies up to $500,000 for posting false information online about Ozempic, Wegovy

Two U.S. senators are aiming to crack down on deceptive or misleading online promotion of weight-loss and other prescription drugs by telehealth firms and social-media influencers who profit from their posts.

New bipartisan legislation proposed by Sens. Dick Durbin (D., Ill.) and Mike Braun (R., Ind.) would authorize the Food and Drug Administration to warn and potentially impose costly fines on those who post false information online about medicines, or omit important information about a drug’s safety risks.

One impetus for the bill, according to a Senate aide, is the 2024 reporting by The Wall Street Journal about how social media has fueled demand for Ozempic and Wegovy from Novo Nordisk as well as other drugs used for weight loss. The Journal found that posts on platforms such as TikTok, YouTube and Instagram often omit information about difficult side effects, and that some influencers and companies profit from the posts.

As with company drug advertisements, social-media posts sponsored by drug manufacturers are required by the FDA to cite the risks. But the senators say there is a regulatory gap in FDA oversight when it comes to advertisements from telehealth companies and influencers if there isn’t an established relationship with a drug manufacturer.

Durbin and Braun earlier this year called on the FDA to take action against the marketing of prescription drugs on social media, citing a proliferation of dangerous and misleading content by telehealth companies. Their letter to the FDA commissioner cited findings from a Journal investigation published in 2022 about misleading ads by telehealth companies.

When faced with the criticism, some telehealth firms have said that they provide safety information to patients and have procedures to vet the accuracy of posts by influencers with whom they work.

The new bill, “Protecting Patients from Deceptive Drug Ads Online Act,” says too many social-media posts provide false information, omit key side effects, or fuel demand for medications that might not be appropriate for a patient.

The bill aims to give the FDA authority to require drugmakers to disclose payments to influencers to the federal Open Payments database, as they currently do with payments to physicians and other health providers

The FDA would also have the authority to issue warning letters to influencers and telehealth companies for deceptive and misleading promotions. Those who don’t comply with the warning letters would face fines of up to $250,000 for the first violation in any three-year period, and up to $500,000 for each subsequent violation in any three-year period.

The FDA enforcement would apply to online posts that yield a payment to the influencer or telehealth firm and contain false statements, omit facts regarding a prescription drug, or fail to include traditional risk and side effect disclosures.

It would exempt certain statements that occur in the course of bona fide patient care or describe someone’s personal experience.

The legislation would work similarly to the way the FDA oversees drug advertisements from manufacturers. The agency requires drugmakers to accurately describe the FDA-approved use for the drug, as well as its major side effects, and to direct patients to where they can learn more, like a website.

The FDA sends warning letters to companies if it deems an ad to be misleading, and they can face fines of up to $250,000 for the first violation.