In-space manufacturing may sound like science fiction but it’s happening already, albeit on a very small scale. It’s a fledgling market that analysts and several startups are projecting will take off.
“If you look at pharma, semiconductors, beauty and health products and potentially food in the sense of like new crops, we estimated the market to be above $10 billion at some point in 2030, depending on the speed of maturation,” said Ilan Rozenkopf, a partner at McKinsey.
Space offers a unique environment for research and development because its higher levels of radiation, microgravity and near vacuumless state allows companies to come up with new manufacturing methods or materials that are not possible on Earth.
The practice is not entirely new. The International Space Station has hosted several experiments from academics, government agencies and commercial customers for things such as growing human tissue, making purer semiconductors and developing new or better drugs. In the 2024 fiscal-year budget, President Joe Biden even set aside $5 million for NASA to pursue cancer-related research on the ISS.
But access to the ISS has always been competitive and interest continues to grow. Now, several space startups see an opportunity to satisfy in-space manufacturing demand using compact space factories. One company is Varda Space Industries in Southern California. Varda’s mission is to help pharmaceutical companies improve their drugs or come up with new drug therapies by taking advantage of the unique properties of space, and then return those materials back to Earth.
Varda Space Industries’ first pharmaceutical manufacturing satellite and reentry vehicle attached to a Rocket Lab Photon bus.
Rocket Lab
Key to Varda’s business proposition is a phenomenon known as protein crystallization.
This occurs when super-saturated protein solutions are essentially evaporated to form a solid so scientists can study a protein’s structure. Understanding the crystal structure of a protein can help scientists get a better idea of disease mechanisms, identify drug targets and optimize drug design. Think drugs that have less side effects, are more effective or can withstand a greater array of conditions such as not needing to be refrigerated.
Years of research have shown that protein crystals grown in space are much higher quality than those grown on Earth. The plan is not to make the entire drug in outer space, just what is known as the primary active pharmaceutical ingredient, or the portion responsible for the therapeutic effects of a drug.
“You’re not going to see us making penicillin or ibuprofen or these types of very generic mass consumption targets, given the amount of crystalline you need to create is far beyond our current capabilities,” said Delian Asparouhov, co-founder and president of Varda Space Industries. “But there is a wide set of drugs that do billions and billions of dollars a year of revenue that actively fit within the manufacturing size that we can do even on our current manufacturing facility.”
Asparouhov said that in the U.S. in 2021 and 2022, of the hundreds and millions of doses of the Pfizer Covid vaccine administered, “the actual total amount of consumable primary pharmaceutical ingredient of the actual crystalline mRNA, it effectively was less than two milk gallon jugs.”
Across the Atlantic in Cardiff, Wales, Space Forge is working on designing its own in-space factory to manufacture next-generation semiconductors. Space Forge’s goal is to make semiconductor substrates using materials other than silicon to manufacture more efficient, higher performing chips.
“This next generation of materials is going to allow us to create an efficiency that we’ve never seen before,” said Andrew Parlock, managing director of Space Forge’s U.S. operations. “We’re talking about 10 to 100 X improvement in semiconductor performance.”
A rendering of Space Forge’s ForgeStar manufacturing satellite.
Space Forge
Just like with pharmaceuticals, the secret sauce to achieving this type of performance improvement in semiconductors lies in creating the perfect crystals in space. These types of advanced chips are important for industries such as 5G and electric vehicles. Similar to Varda, Space Forge plans to manufacture only part of the chips in space.
“Once we’ve created these crystals in space, we can bring them back down to the ground and we can effectively replicate that growth on Earth,” said Josh Western, CEO and co-founder of Space Forge. “So we don’t need to go to space countless times to build up pretty good scale operating with our FAB partners and customers on the ground.”
To learn more about in-space manufacturing as well as Varda and Space Forge’s plans to make the practice a viable business, watch the video.
Co-founder and Chief Science Officer at Hugging Face, Thomas Wolf, speaks at the opening ceremony of the Web Summit, in Lisbon, Portugal, November 11, 2024.
Pedro Nunes | Reuters
Current artificial intelligence models from labs like OpenAI are unlikely to lead to major scientific breakthroughs, a tech co-founder said, pouring cold water on some of the hype around the technology and claims by major figures in the field.
The comments by Thomas Wolf, co-founder of $4.5 billion AI startup Hugging Face, are in stake contrast to those by major names in AI including OpenAI boss Sam Altman and Anthropic CEO Dario Amodei.
When Wolf talks about scientific breakthroughs, he means novel ideas like those at a Nobel Prize level. Examples including Nicolaus Copernicus who theorized the sun was at the center of the universe and other planets move round it.
Wolf explained a couple of issues with chatbots right now. The first is that these products like ChatGPT and others often agree or align with the person prompting it. Think back to if you’ve asked a chatbot a prompt and it will tell you how interesting or great that question is.
The second is that the models underpinning these chatbots are designed to “predict the most likely next token” or “word” in a sentence.
However, he noted two key traits of scientists. The first is that scientists who make major breakthroughs are often contrarian and question what others are saying.
“The scientist is not trying to predict the most likely next word. He’s trying to predict this very novel thing that’s actually surprisingly unlikely, but actually is true,” Wolf said.
The Hugging Face co-founder has been thinking about this topic for the last few months. His interest was sparked after he read an essay penned by Anthropic’s Amodei, who posited that “AI-enabled biology and medicine will allow us to compress the progress that human biologists would have achieved over the next 50-100 years into 5-10 years.”
That got Wolf thinking about the state of AI and how this won’t be possible, in his view, with the current crop of models.
Wolf said that these chatbots and tools will likely be used as a sort of “co-pilot for a scientist” where they are used for research to help the human generate new ideas.
To some extent, this has been happening already. Google DeepMind’s AlphaFold product has helped to analyze protein structures which the company has promised could aid scientists in discovering new drugs.
But there are some new startups that are hoping to take AI one step further into being able to make scientific breakthroughs, including Lila Sciences and FutureHouse.
Taiwan Semiconductor Manufacturing Company, Limited at Hsinchu Science Park.
Annabelle Chih | Getty Images News | Getty Images
Taiwan will not accept Washington’s proposal to locally manufacture half the chips it currently supplies to the U.S., the island’s top trade negotiator said.
Speaking to reporters, Cheng Li-chiun, also the country’s vice premier, said on Wednesday that the proposal for a “50-50” split in semiconductor production was not even discussed, as she returned from trade talks in the U.S., according to Taiwan’s Central News Agency.
Cheng said the talks were focused on lowering tariff rates, securing exemptions from tariff stacking — additional duties — and reducing levies on Taiwanese exports. Taiwan currently faces a “reciprocal” tariff rate of 20%.
Washington has held discussions with Taipei about the “50-50” split in semiconductor production, which would cut American reliance on Taiwan, Commerce Secretary Howard Lutnick said last weekend in an interview to NewsNation, adding that currently 95% of the U.S. demand was met via chips produced within Taiwan.
“My objective, and this administration’s objective, is to get chip manufacturing significantly onshored — we need to make our own chips,” Lutnick said. “The idea that I pitched [Taiwan] was, let’s get to 50-50. We’re producing half, and you’re producing half.”
U.S. President Donald Trump had also taken aim at the island’s dominance in chips earlier this year, accusing it of “stealing” the U.S.’ chip business.
The Office of the U.S. Trade Representative and Taiwan’s Ministry of Economic Affairs did not immediately respond to CNBC’s request for comments.
Lutnick’s proposal has been condemned by Taiwan’s politicians, with Eric Chu, chairman of the island’s principal opposition party Kuomintang, calling it “an act of exploitation and plunder,” according to the Central News Agency report.
“No one can sell out Taiwan or TSMC, and no one can undermine Taiwan’s silicon shield,” Chu said, referring to Taiwan Semiconductor Manufacturing Company, the world’s leader in advanced chip manufacturing.
Taiwan’s critical position in global chips production is believed to have assured the island nation’s defense against direct military action from China, often referred to as the “Silicon Shield” theory.
In his NewsNation interview, Lutnick downplayed the “Silicon Shield,” arguing that Taiwan would be safer with more balanced chip production between Washington and Taipei. Beijing views the democratically governed island of Taiwan as its own territory and has vowed to reclaim it by force if necessary, while Taipei rejects those claims.
Taiwan People’s Party Chairman Huang Kuo-chang reportedly called Lutnick’s proposal an attempt to “hollow out the foundations of Taiwan’s technology sector.”
Headquarters of Samsung in Mountain View, California, on October 28, 2018.
Smith Collection/gado | Archive Photos | Getty Images
Shares of South Korean chip heavyweights Samsung Electronics and SK Hynix surged Thursday, a day after the two companies partnered with artificial-intelligence major OpenAI as part of the U.S. firm’s Stargate initiative.
Samsung shares hit their highest since January 2021, rising over 4%, while SK Hynix stock surged more than 9% — highest since 2000.
OpenAI said in a statement that this partnership will “focus on increasing the supply of advanced memory chips essential for next-generation AI and expanding data center capacity in Korea.”
The ChatGPT-maker said the two South Korean firms plan to scale up production of advanced memory chips, which are critical to power its AI models.
The announcement came as OpenAI CEO Sam Altman met with South Korean President Lee Jae Myung in Seoul, and the top leaders at Samsung and SK Hynix.
OpenAI has also signed a series of agreements to explore developing next-generation AI data centers in South Korea, including with the Korean Ministry of Science and ICT, telecommunications operator SK Telecom, as well as with Samsung subsidiaries.
Earlier this month, SK Hynix announced that it was ready to mass-produce its next-generation high-bandwidth memory chips, cementing its leading position in the AI value chain. HBM is a type of memory that is used in chipsets for artificial-intelligence computing, including in chips from global AI giant Nvidia — a major client of SK Hynix.
HBM4 chips are expected to be the main AI memory chip needed for Nvidia’s next-generation Rubin architecture — a more powerful AI chip for global data centers.
SK Hynix has been a main chip supplier to Nvidia, while rival Samsung has reportedly been working to get its HBM4 chips certified by Nvidia.
Samsung has traditionally been the market leader in memory, but its position has been threatened by SK Hynix that has taken a lead in the HBM space. A report from Counterpoint Research in July found that SK Hynix had caught up with Samsung’s memory revenues in the second quarter, with both now vying for the top position in the global memory market.
Samsung’s second-quarter earnings missed expectations, as profits from its chip business declined almost 94% year on year, although its Chief Financial Officer Soon-cheol Park said that the company expects a rebound in the second half of the year.
