The start-up making drugs in space, then sending them to Australia at 30,870 km/h

The Age

20-07-2025

When it comes to the future, you have to ask: are we there yet?
For example, is it possible that space capsules are orbiting the Earth - while they make advanced drug compounds?
And then the same capsules are returning to terra firma after travelling at 25 times the speed of sound into our atmosphere?
Why, yes...
And when they return to Earth, they are returning to Australia?
Yes, again.
'It's actually much less futuristic than it sounds,' says Will Bruey, CEO of Varda Industries, the company launching the drug-factory capsules.
'On average three SpaceX Starlink satellites are launched per day, and our spacecraft is simpler, quite frankly, than a Starlink satellite,' he says.
And, while it's early days for California-based Varda, founded in 2021, the pace of launch for these capsules – whose journey takes them from the US, to low earth orbit, to a South Australian testing range for recovery – is expected to increase.
The start-up is attempting to create a viable business of manufacturing drugs in space, where the lack of gravity unlocks the possibility of new, more effective – and more profitable – drug compounds that can't be made on Earth.
Being in space, the limits on the scale of manufacturing are different to an Earth-bound enterprise – both in the molecular quality of what can be produced and, potentially one day, the scale of the production facility.
For now, the company's future depends on how effectively and profitably it can formulate drugs – or at least the most effective primary active pharmaceutical ingredient – in orbit.
When discussing drug production, Bruey compares microgravity (ultra-low gravity in orbit) to the effect that refrigeration has had on drug production since it was invented.
Before refrigeration existed, people would have asked, how could it create value for pharmaceuticals? Today, refrigeration is a fundamental part of drug and vaccine manufacturing, shipping and storage. It reduces the risk of contamination and helps ensure the drugs are effective. Profitable drug manufacturing would be almost unthinkable without it.
One day, space-based drugs may be discussed the same way. 'The way the pharmaceutical industry will think about [Varda] shortly is just another piece of equipment.'
Even the name of the spacecraft – the W in Varda's W-series capsule – unofficially stands for 'Winnebago' (or caravan in American English) used in TV series Breaking Bad, which is itself a story about the remote, compartmentalised cooking up of drugs.
'Instead of going to the desert, we're going to space,' Bruey said.
Likewise, Varda is hauling its equipment to a destination to make its batch, then coming back. 'So that's what we'll be doing. And we'll just be increasing the amount of Winnebagos that are going out to space and back.'
'There's a lot of low-hanging fruit and optimisation to be done in that paradigm.'
Any drug with a formulation improvement worth more than $US200 a gram is viable for Varda to manufacture today. But Varda forecasts it can drive down the cost from $US200 to $US20 'pretty easily by just making our systems more reusable'.
To push lower than that, the company will construct a permanent station with manufacturing equipment that can be used for multiple drugs, Bruey says.
Much of the science around drugmaking in space has been done. There have been numerous experiments on pharmaceuticals, for example, on the International Space Station.
Varda hopes to have a space-made drug in humans by the end of the decade. In an era of sagging productivity, it's worth considering the value of genre-melding new ventures.
The question is: how much demand is there for a service that is new to the world? And on Earth – in Australia – how many re-entries could we see?
Adelaide-based company, Southern Launch, was formed in 2017 as a spaceport operator providing launch services. It has since begun offering orbital re-entry services for customers like Varda.
Their range, at Koonibba in South Australia, enjoys clearer skies with less air traffic than test ranges in the US, giving more flexibility to Varda and other clients, Southern Launch says.
Southern Launch CEO Lloyd Damp said the missions conducted for Varda so far, 'mark an incredible step forward for Australia as the global landing site for re-entries and the in-space manufactured goods the capsules carry.'
Investing in an unproven business model is riskier than investing in say, inner city residential property. But Bruey sees Varda as carving out a niche that can expand as demand grows.
'Basically, there's only four fundamental forces of physics, and gravity is one of them, and we have a knob on [it], and no other company does.' (If you're wondering, the three other forces are: electromagnetism and the strong and weak nuclear forces).
Bruey knows about physics because he studied the subject at Cornell University before founding a couple of companies and working at Elon Musk's SpaceX.
Bruey then met up with Delian Asparouhov, who was looking to invest in a company that could do this work. Asparouhov was looking for someone with Bruey's background and who 'was willing to drop everything and go on this adventure'.
Varda now has backing from Khosla Ventures, Lux Capital, Caffeinated Capital, Founders Fund, and General Catalyst. It has raised $US187 million in a new funding round this month, bringing the total capital raised to $US329 million.
The bet that money can be made by low-orbit manufacturing has caught the attention of SpaceX, which reportedly has plans to get into the space-drug game by manufacturing too.
Elon Musk's company plans to use its massive – and recently unlucky – Starship rocket for the purpose, according to Bloomberg. Sources close to Varda call the report about SpaceX's plan, called Starfall, a 'validation' of Varda's business model.
Like SpaceX, Varda's goal isn't science, it's business: advanced, space-tech business, with the potential to unlock a huge new market that could one day involve large in-orbit factories. The in-space manufacturing market could be worth $US10 billion in five years, according to McKinsey.
But exploiting a fundamental force of physics for profit comes with some hard realities. If you send the capsule into space, you must find a reliable place to recover the spacecraft – closing the loop on the production process.
That's where Australia comes in.
Varda's first craft W-1, launched in June 2023, was due to return in July, but instead got delayed as the company sought permission for the landing in Utah. It remained in orbit for eight months while the details of a new license were resolved between government authorities.
While W-1 was in orbit, Varda reached out to Australia's space industry, looking for reliable space return services.
W-1's February 2024 return coincided with Varda being granted a 'Part 450 re-entry license' from the FAA's Office of Space Transportation, part of a new process to accommodate repeated missions common in commercial space.
Varda now has a FAA license which allows the company to launch and re-enter a craft without spelling out the identical parameters of the mission on repeated applications.
When Varda's W-2 landed in South Australia, Enrico Palermo, head of the Australian Space Agency said it highlighted 'the opportunity for Australia to become a responsible launch and return hub for the global space community, capitalising off the geographic advantages of our expansive continent.'
Unlike crewed missions, which must gently skim into the atmosphere without burning up to bring humans safely home, Varda's missions comes in 'ballistically, as if it's like a missile'.
In that phase, the Winnebagos achieve Mach 25, twenty-five times the speed of sound, or 30,870 kilometres per hour.
Varda has attached a camera to the capsule to capture the dramatic re-entry footage, which looks something like a gas log on overdrive. In space.
The pink glow you see is plasma, Bruey says, from the capsule moving so fast and creating so much heat 'it's literally ripping the molecules in the atmosphere apart and ripping away their electrons'.
'The streaks of what looks like fire is the heat shield 'ablating', that is the little pieces coming off intentionally to take away the heat, shedding it from the spacecraft.'
So far, Varda has created a crystal form of an HIV drug ritonavir in space.
It has research collaborations with large pharma brands, whose names Varda would not give, citing non-disclosure agreements.
W-2 and W-3 landed in February and May 2025 at Koonibba Test Range in South Australia. W-4 is currently in orbit. Varda says it is on track for four missions in 2025 – with plans to expand to a double-capsule mission in 2026. From there, the pace is expected to increase to a weekly pace.
Veteran space industry observer and contributor Brett Biddington says Australia is 'well-suited to support the recovery of payloads from space' with a historical record that is 'unblemished'.
'Whether a viable business can be made just from recovery support is another question,' he says.
He expects that the 'activity will be lumpy and sporadic' and can best thought of as a 'supplementary income stream' to one that is more reliable.
Varda's plan isn't to create a new business alone, but the industry needed to support and grow the enterprise.
With the capsules going up and coming back, we will soon know if Varda is successful.