Investing in Space

Investing in Space: Regulatory hold up keeps Varda spacecraft stuck in orbit

Varda Space Industries' first pharmaceutical manufacturing satellite and reentry vehicle attached to a Rocket Lab Photon bus.
Rocket Lab

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Overview: Regulatory frontiers

There's a small spacecraft zipping around Earth right now, but, unlike most satellites in orbit, it wants to come down. The only catch is that, so far, it's not allowed to.

Last month's Senate hearing on space regulations highlighted the challenge authorities face in regulating this industry, balancing safety while innovative technologies butt up against established practices in an evolving frontier sector. The hearing didn't feature a representative from Varda — the company behind that stuck satellite — but co-founder Delian Asparouhov echoed those sentiments in a recent conversation, albeit from a different perspective. 

Varda's first mission launched in June and was expected to be complete by July. My overly simplified version of its goals: Test to see if the spacecraft and all its systems work, manufacture a drug in microgravity, and then re-enter the capsule and recover it after landing at the Air Force's Utah Test and Training Range. 

The launch went great, the spacecraft has been healthy, drugs were made, but the necessary license for capsule reentry has not been granted. 

So, for the last three months, Varda's W-Series 1 has remained in space while a trio of organizations – the company, the Federal Aviation Administration's space office (AST) and the Air Force – back on the ground try to resolve when it can safely return.

In Asparouhov's view, there have been "learning curves for all parties to understand how to assess this type of activity." While Varda has been talking to AST since the earliest days of the company, the FAA hadn't issued a reentry license by the time the mission was set to launch. But AST "encouraged us to proceed with our launch," Asparouhov said, "with the goal being that we would continue to coordinate that license as well as the use of a reentry timing with the range while we were in orbit.

"AST prefers to license only a couple days before a particular operation happens. That may make sense for launch but it's a bit more difficult for reentry," Asparouhov said. "And the upper atmosphere shifts, even on a very simple basis. How the stratosphere reacts to a reentry capsule in September is very different than February, which is very different than June."

Varda and regulators are "spiraling in on a point on a circle" to establish and sign off on a new reentry target, Asparouhov said. He explained that process generally starts with sets of days that work for the Air Force, which then goes to AST for licensing review, which then goes to the FAA's air traffic office for analyzing how to minimize the impact on airline routes, before then going back to Varda for reentry maneuver preparations. 

"It's continuous negotiation with continuous communication in a continuous feedback loop from a multi-party system," Asparouhov said, so there is "a lot of back and forth to the various parties that have never done it before together."

For future missions, Varda's added Koonibba Test Range in Australia as another potential landing site. But for this first mission, still in space, the range in Utah is the only "realistic" landing spot, Asparouhov said – so work continues to align the regulatory stars and return the capsule safely.

What's up

  • Starlink achieves 'breakeven cash flow,' as SpaceX continues to improve the financial viability of the satellite internet service. Previously, CEO Elon Musk highlighted crossing "through a deep chasm of negative cash flow" as crucial to the business unit's future. – CNBC
  • FAA safety review of Starship completed, but environmental review continues as the U.S. Fish and Wildlife conducts its assessment of the SpaceX system, which needs to be complete before the FAA can issue a modified launch license for the second Starship launch. – Read more
  • Virgin Galactic completes fifth commercial spaceflight, with the Galactic 05 mission maintaining the company's monthly flight rate. The mission carried a trio of passengers: Alan Stern, Southwest Research Institute planetary scientist; Kellie Gerardi, Palantir mission operations lead and bioastronautics researcher for the International Institute for Astronautical Sciences; and Ketty Pucci-Sisti Maisonrouge, luxury and retail goods investor. – Virgin Galactic
  • Blue Origin shows off latest moon lander design, with founder Jeff Bezos showing NASA chief Bill Nelson a mock-up of the Blue Moon Mark 1 (MK1) cargo lander. – Nelson / Blue Origin
  • Intuitive Machines lunar mission delayed to January, with the company resetting its launch window from Nov. 15 to Jan. 12 "in coordination with SpaceX." – Intuitive Machines
  • Astrobotic's Peregrine lunar lander arrives in Florida as the company prepares to launch on ULA's inaugural Vulcan rocket on Christmas Eve. – Astrobotic
  • Sierra completes first Dream Chaser spaceplane and will soon ship it to NASA's Armstrong facility for environmental testing to prepare it for launch. – Sierra Space
  • Rocket Lab targets December 2024 window for Venus mission, with the company's lead interplanetary missions engineer Christophe Mandy saying the launch is aimed for Dec. 30 of next year. – SpaceNews
  • U.S. and Australia sign agreement for American rocket launches from spaceports in the southern hemisphere country. The State Department announced the signing of a Technology Safeguards Agreement (TSA) to allow U.S. built rockets to launch from Australia. – SpaceNews
  • Position, Navigation and Time (PNT) satellite startup TrustPoint partners with Impulse to deliver the second TrustPoint satellite with the first Mira space tug mission. – TrustPoint
  • Former Blue Origin leaders reveal moon startup Interlune, aiming "to be the first company that harvests natural resources from the moon to use here on Earth." Interlune was announced by Gary Lai, previously Blue Origin's chief architect. – GeekWire
  • Netherlands signs Artemis Accords, the 31st country to do so. – NASA

Industry maneuvers

  • Space Force awards $2.5 billion for 21 launches to SpaceX and ULA in the final round of the NSSL (National Security Space Launch) Phase 2 program. ULA received 11 missions, valued at $1.3 billion, and SpaceX received 10 missions, valued at $1.23 billion. – CNBC
  • Pentagon awards $1.3 billion in contracts to Northrop Grumman and York to build 100 satellites for the T2TL-Alpha (Tranche 2 Transport Layer Alpha) segment of the Proliferated Warfighter Space Architecture (PWSA). Northrop will build 38 satellites for $732 million, while York will build 62 satellites for $617 million. – CNBC
  • HawkEye 360 awarded $12.25 million Navy contract, with the radio frequency satellite company to provide data and analytics "with partner nations in Southeast Asia and the Pacific Islands." – HawkEye 360
  • EchoStar wins Delta contract for WiFi service on over 400 regional aircraft, including the airline's fleet of Boeing 717 jets. – EchoStar
  • SpaceNews is merging with Multiverse Media in a combination of space industry media and enthusiast brands, with content ranging from reporting to documentaries. – SpaceNews

Market movers

  • Viasat laying off 800 employees, or about 10% of its workforce, as part of the process of integrating Inmarsat into the company. "This move is expected to result in annualized run-rate operating expense cost savings of approximately $100 million beginning primarily in FY2025." – Viasat
  • SES working with Boeing to fix mPOWER satellite problems, with the contract changes having cost Boeing $315 million in third quarter losses. The first four O3b mPOWER satellites are struggling with power issues that will delay the beginning of SES service from the constellation. While the next two mPOWER satellites are about to launch, Boeing will apply fixes to the next five and SES added two more satellites to the order to make up for the lost service from the initial satellites.  – Via Satellite

Boldly going

  • Dan Smoot appointed CEO of Maxar satellite imagery business, which was split off as 'Maxar Intelligence' from the spacecraft business by owners Advent International. Smoot joins from his previous role as CEO of IT company Riverbed Technology and replaces longtime Maxar CEO Daniel Jablonsky, who will join the company's board. – Maxar
  • Nina Armagno joins Rocket Lab board of directors, coming to the company after retiring as a three star Space Force general in July. – Rocket Lab
  • Dómhnal Slattery named Chairman of SpinLaunch, in a newly created role on the company board of directors. Slattery was an aviation financier, specializing in aircraft leasing. Greg McAdoo also joined the board, previously a senior partner at Sequoia Capital. – SpinLaunch

On the horizon

  • Nov. 3: SpaceX's Falcon 9 launches Starlink satellites from Florida.
  • Nov. 6: Redwire reports third-quarter results after the market closes.
  • Nov. 7: SpaceX's Falcon 9 launches Starlink satellites from California.
  • Nov. 7: SpaceX's Falcon 9 launches Starlink satellites from Florida.
  • Nov. 8: FAA meeting of the Commercial Space Transportation Advisory Committee.
  • Nov. 8: Rocket Lab, Virgin Galactic and Spire report third-quarter results after the market closes.