Oterra has teamed up with Debut Bio to develop and scale a natural alternative to Red 40, a petroleum-derived food dye linked to ill health in children.
The food industry’s reckoning with the use of artificial dyes continues with a new partnership targeting the most commonly used colourant in the US.
Danish natural colour pioneer Oterra has teamed up with Debut, a Californian AI-led biotech company, to develop a fermentation-derived substitute for Red 40 (or Allura Red).
The multi-million-dollar collaboration will scale Debut’s precision fermentation process to create a high-performing alternative to this ubiquitous red dye, which is derived from petroleum and associated with health issues in children.
“Oterra has a 150-year heritage of innovating colours from natural sources, including several Red 40 alternatives,” said Luc Ganivet, head of innovation at the company.
“Our collaboration with Debut brings exciting new technology options to significantly strengthen our natural portfolio with optimised technical performance. It also offers secure supply, independent of weather and harvest, without compromising on natural credentials,” he added.
The partnership comes amid an overhaul of dye use in the food and drink industry in the US, where manufacturers have shifted away from artificial colours under pressure from health secretary Robert F Kennedy Jr.
Oterra and Debut eye FDA approval and launch within three years
Precision fermentation finvolves inserting a DNA sequence into microbes to teach them to produce specific molecules when fermented.
Debut and Oterra will use this technology to develop and scale an alternative to Red 40, which will, in turn, make it possible to produce fossil-free pigments spanning red, orange and violet for food and beverage manufacturers.
The natural dye will work in a range of applications, including meat and prepared foods, confectionery, dairy, and fruit preparations. Plus, the precision fermentation process will help lower the land and water use associated with conventional red dye, as well as existing plant-based alternatives.
“We’re excited to fast-track the commercialisation of natural red alternatives from precision fermentation with Oterra,” said Debut founder and CEO Joshua Britton.
“Biotech offers clear advantages that align with evolving market demand. Its adoption in the food and beverage industry is particularly compelling, providing a high-performance alternative to FD&C colours and Red 40, which faces increased regulatory scrutiny.”
The two companies are now filing an application to the US Food and Drug Administration (FDA) in pursuit of regulatory approval for the innovation, with the goal of bringing a scaled-up product to market in the next three years. It is also beginning collaborations with leading food and beverage companies to prepare for eventual market entry.
Last year, the FDA banned the use of Red Dye No. 3, another petroleum-derived colourant identified as harmful to both human and planetary health. The colourant has already been banned or severely restricted in Europe, Japan, Australia and New Zealand.
Golden chance for natural colours as consumers see red over synthetics
The ban on Red Dye No. 3 – set to come into effect next January – brightened the spotlight on Red 40, which is present in more than 36,000 food products across the US. It is, by far, the most used pigment in the industry, and commands a global market valued at $140M.
But Red 40 is sourced from the petroleum industry, made via a chemical reaction between two types of sulphonic acids. It’s also been linked to hyperactivity in children and cancer in animals. These harmful traits are why the EU has required manufacturers to put warning labels on products containing this colourant since 2010.
In the US, California announced a ban on Red 40 from being used in school meals, alongside six other common dyes. And at least 26 other states have introduced or passed bills to ban, restrict or require warning labels for artificial pigments for food.
RFK Jr’s Make America Healthy Again movement has been the key instigator of the backlash against synthetic food colours, with two-thirds of Americans supporting his calls for the industry to ditch these ingredients.
These dyes appear in nearly a fifth of packaged food and beverage products in the US. In fact, research from Innova Market Insights shows that 28% of launches from Big Food companies in 2025 contained artificial dyes. Manufacturers like Nestlé, Mars, Kellogg’s, General Mills and others have been removing these colours from various products, and the FDA even has a public tracker for such pledges.
To encourage this shift, the FDA amended the colour additive regulations to recognise the safe use of beetroot red in food products this year, and said that food labels can now claim to have ‘no artificial colors’ if they are free from petroleum-based dyes. Previously, companies could only make this claim if the products had no added colouring at all.
The demand for natural colours has caught the eye of investors too. In November, Chromologics raised $8M to launch its food-grade, microbial alternative to synthetic red dye in the US and Europe, and in January, Octarine Bio secured $5.8M to launch precision-fermented pigments for food, textiles, and personal care.
A month later, University of Cambridge spinout Sparxell closed a $5M funding round for its plant-based colours, which can replace fossil-fuel-derived pigments in the textile, cosmetics, food, packaging, paint and automotive sectors.
