biological solutions in a chemical world

BIOLOGICAL SOLUTIONS IN A CHEMICAL WORLD

Thomas Schäfer

Vice President, R&D

Philadelphia, August 2012

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• Largest market share of all players in Industrial Enzymes (47%)

• More than 60 years legacy in the business

• 2011 sales of DKK 10,510m (+8% in DKK, +10% in LCY, +7% organic)

• 20 years sales growth CAGR of 8%

• EBIT: DKK 2340m (+11 %)

• ~ 14% of sales spent on R&D

• + 6,300 granted and pending patents

• + 5,500 employees

• Global Organisation

• More than 700 products used in 130 countries in over 30 different industries

Novozymes – The World Leader in Bioinnovation

Global enzyme market 2009 value: DKK ~ 16bn

47% 21% 6% 16% 10%

0% 20% 40% 60% 80% 100%

Novozymes Danisco DSM Others Captive

*A+B shares April, 2011

Enzyme Business BioBusiness

Household Care

Food & Beverages

Bioenergy Feed &

other Tech. Micro-

organisms Biopharmaceutical

ingredients

8/19/2012 NOVOZYMES PRESENTATION ACS 2012 Schäfer

Novozymes’ Vision

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• Less need for energy, water and chemicals

• Better utilization of raw materials

• Less CO2 emissions • Ability to convert agricultural feedstocks • Ability to produce food, feed, fibres, fuels & materials


Central Working Hypothesis: Sugar/biomass can gradually & partially replace fossile feedstocks

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Fuel

Chemicals

Energy

…

• Where it “makes sense” (economy, LCA, customers) • Where it is technically advantagous


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Biorefinery as central element

NOVOZYMES PRESENTATION

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Summary: Novozymes technologies deliver key enablers for the biobased society

The Sugar Platform

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Strong partnerships from agriculture to consumer

companies

4

INPUT

Platform Chemicals

Microbial products for BioAg

Enzymes

OUTPUT

REFINING

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1 3


NOVOZYMES PRESENTATION ACS 2012 Schäfer 7 8/19/2012

INPUT: Three main technology BioAg platforms

Biofertility • Improve the uptake of N and P

Biocontrol

• Fungicides and bactericides

• Insecticides

• Herbicides

• Nematicides (future interest)

Bio-yield enhancement

• Yield improvement unrelated to macronutrient acquisition

1

LCO: OBSERVED BENEFITS

Rhizobia

Novozymes’ Central Technology: The Sugar Platform

• Cellulosic bioethanol drives our technology development

Bio- ethanol

Yeast Fermentation

Pre- treatment

process

Enzyme process

Waste biomass

Cellulose

Starch Enzyme process

Ferm

enta

ble

sugars

8

2


Allows production of

fuel ethanol from

biomass @ ca. USD 2.50 per gallon, depending on process

Feb 2010: Novozymes Launches Cellic® CTec2

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Feb 2012: Next generation

Cellic®

CTec3 We can secure your plant’s

lowest total cost


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Feb 2012: Next generation

Cellic®

CTec3


THE TECHNOLOGY IS READY AND PRODUCTION IS BEING SCALED UP

2013 2012 2011 2010 2014

Europe

Demonstration scale Pilot scale Brazil

US

Commercial scale Demonstration scale Pilot scale China

Commercial scale Demonstration scale

Commercial scale Demonstration scale

12 SELECTED EXAMPLES

M&G Breaks Ground for First Commercial Plant in EUROPE

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• Novozymes’ partner M&G begins construction of the world’s first commercial-scale cellulosic ethanol plant

• The plant will produce 13 million gallons of ethanol per year from biomass, and is competitive with 60-70 USD/barrel oil

• The biofuels plant will be ready in 2012, and is located in Crescentino, Northern Italy

Pictures courtesy of M&G


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…while China accelerates: Shengquan Group in July 2012…

Novozymes’ partner Shengquan invests $100 million to market cellulosic ethanol

During the visit to Denmark of Hu Jintao, President of the People's Republic of China, Shengquan and Novozymes finalized an enzyme supply deal to market cellulosic ethanol.

15. June 2012 http://www.novozymes.com/en/news/news-

archive/Pages/novozymes-partner-shengquan-

invests-100-million-to-market-cellulosic-ethanol.aspx

• When China’s Shengquan Group starts producing cellulosic ethanol in July 2012, it will be the first in the world to do so on a commercial scale.

• More than that, the production will also be cost-competitive with conventional ethanol, as the feedstock is a waste product from Shengquan’s current production.

• Shengquan is a leading producer of furfural for resin production in the foundry industry. Furfural is produced from corncob xylose, with the cellulose from the corncob left behind as a waste product. Using Novozymes’ enzymes, Shengquan will now be able to convert the cellulose into higher-value sugars that can be fermented to ethanol.


http://www.novozymes.com/en/news/news-archive/Pages/novozymes-partner-shengquan-invests-100-million-to-market-cellulosic-ethanol.aspx





















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…as well as Brazil

Novozymes to supply first advanced biofuels factory in Brazil

Brazilian bioenergy company GraalBio to

construct commercial scale cellulosic ethanol facility in Brazil by 2013.

23. June 2012

http://www.novozymes.com/en/news/news-

archive/Pages/Novozymes-to-supply-first-advanced-

biofuels-factory-in-Brazil.aspx

• Today, June 23.05. 2012, GraalBio announced plans to start production in December 2013 of 82 million liters (22 million gallons) of advanced biofuels per year at a new factory in the Brazilian state of Alagoas.

• The plant will produce cellulosic ethanol from sugarcane bagasse and straw.

• Novozymes will supply the necessary enzyme technology

• Beta Renewables and Chemtex, both part of Italian chemical group Mossi & Ghisolfi (M&G), will provide other process technologies and engineering.


http://www.biofuelsdigest.com/bdigest/2012/05/24/graalbio-investimentos-plans-to-invest-724-5-million-in-five-cellulosic-ethanol-projects-in-brazil/

http://www.novozymes.com/en/news/news-archive/Pages/Novozymes-to-supply-first-advanced-biofuels-factory-in-Brazil.aspx
















































The Sugar Platform is our link to OUTPUT

Bio- ethanol

Yeast Fermentation

Pre- treatment

process

Enzyme process

Waste biomass

Cellulose

Starch Enzyme process

Ferm

enta

ble

sugars

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Platform Technology: enables production of a broad spectrum of products

3


Bio- ethanol

Yeast Fermentation

Production of Renewable Chemicals – a Good Fit to our Technology and our Vision

Ferm

enta

ble

sugars

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3


Bio- ethanol

Yeast Fermentation

Ferm

enta

ble

sugars

Renewable chemicals

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3


Bio- ethanol

Yeast Fermentation

Ferm

enta

ble

sugars

Heterogenous catalysis

Renewable chemicals

Renewable chemicals

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3


Bio- ethanol

Yeast Fermentation

Partnering is essential for us

Novel engineered pathway

-- Novel

Bioprocess/ Enzymes

Ferm

enta

ble

sugars

Chemical Catalysis

Renewable chemicals

Renewable chemicals

Renewable chemicals

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3


Acrylic acid

C4 dicarboxylic acids

Novozymes’ biochemicals pipeline

BY BUILDING A BIOCHEMICAL INDUSTRY TOGETHER WITH OUR PARTNERS

PAVING THE WAY FOR THE BIOBASED SOCIETY

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Partner tbd

Partner tbd

Glutamic acid

Green polypropylene

Glycol

HMF/FDCA

Novozymes’ biosolutions for biochemicals


Acrylic acid

C4 dicarboxylic acids

Novozymes’ biochemicals pipeline

HIGHLIGHTS AUGUST 2012 PAVING THE WAY FOR THE BIOBASED SOCIETY

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Partner tbd

Partner tbd

Glutamic acid

Green polypropylene

Glycol

HMF/FDCA

Novozymes’ biosolutions for biochemicals


Novozymes/Cargill partner with BASF

August 18th, 2012

Cargill & Novozymes started in 2008

BASF joins the cooperation now

NOVOZYMES PRESENTATION ACS 2012 Schäfer 24 8/19/2012

Produced from renewables

Source: ICIS, SRI Consulting

Market potential

• Market size: 130 mUSD

• Market volume: 60 kMT

• Annual growth: 4%

• Applications: Food, beverages, cleaning agents

• C4 dicarboxylic acids are platform chemicals:

• can be further converted into derivatives such as BDO, THF and GBL which are used for a wide variety of plastic, polymer and resin applications

Case study: Novozymes’ Malic Acid project

Petro-based feedstock

Maleic anhydride

Malic acid

Starch or biomass

Glucose Malic acid

Price in USD 2000 2010

Malic acid 800/MT 2100/MT

25 8/19/2012 25 NOVOZYMES PRESENTATION ACS 2012 Schäfer

Overview of Novozymes’ Malic Acid project

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MALIC ACID STATUS AUGUST 2012

Overall objective was to develop a microorganism that produces

commercially relevant levels of malic acid and secure freedom to

operate by timely filing of IP

Approach: Improve malic acid production in the novel, natural

malic acid producing filamentous fungus Aspergillus oryzae

NRRL 3488 by overexpression of cloned genes and classical

mutagenesis

Project targets were defined by a minimum volumetric

productivity and an overall Performance Factor (= Final product

concentration * Volumetric Productivity * g/g Yield on glucose)

Target performance must also be achieved in commercially

acceptable fermentation medium

8/19/2012 26 NOVOZYMES PRESENTATION ACS 2012 Schäfer

Highest final malic acid concentration (Mutant M3) and highest volumetric productivity (Mutant M4)

0

50

100

150

200

250

300

350

0 24 48 72 96 120 144 168 192

Ac

id C

on

ce

ntr

ati

on

(g

/L)

Time (hrs)

Major Acids

Total C4 acids

Malic acid

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0

50

100

150

200

250

300

0 24 48 72 96 120 144 168 192

Ac

id C

on

ce

ntr

ati

on

(g

/L)

Time (hrs)

Major Acids

Total C4 acids

Malic acid

Data from un-optimized lab scale fermentations

Likelihood of further strain improvements is high

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NOVOZYMES PRESENTATION ACS 2012 Schäfer 8/19/2012

Malic Acid as the preferred C4-platform chemical: RECOVERY - crystal formation in fermentation

Crystal size varies with strain/lineage

Smaller crystals give higher viscosity

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Mutant M3 Mutant M4

8/19/2012 28 NOVOZYMES PRESENTATION ACS 2012 Schäfer

Enzymatic modifications relevant for the chemical industry: > het/homogenous catalysis!

NOVOZYMES PRESENTATION ACS 2012 Schäfer

8/19/2012

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• Application of lipases & cutinases in aqueous or non-aqueous environment. Can be enantioselective. Also used for polyester synthesis.

Esterification and ester hydrolysis

• Hydrolysis to amide or carboxylic acid under mild conditions. Can be enantioselective.

Nitrile hydrolysis

• Polymerization of aromatic structures by hydrogen abstraction using oxidoreductases Free-radical polymerization

• Oxidation of aromatic side chains using oxidoreductases Side chain oxidation

• Hydroxylation of aromatic or aliphatic carbon using oxidoreductases. Can be enantioselective Hydroxylation

• Epoxidation of double bonds using lipases or oxidoreductases Epoxidation

4

Enzymatic modifications relevant for the chemical industry: > het/homogenous catalysis!

NOVOZYMES PRESENTATION ACS 2012 Schäfer

8/19/2012

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• Application of lipases & cutinases in aqueous or non-aqueous environment. Can be enantioselective. Also used for polyester synthesis.

Esterification and ester hydrolysis

• Hydrolysis to amide or carboxylic acid under mild conditions. Can be enantioselective.

Nitrile hydrolysis

• Polymerization of aromatic structures by hydrogen abstraction using oxidoreductases Free-radical polymerization

• Oxidation of aromatic side chains using oxidoreductases Side chain oxidation

• Hydroxylation of aromatic or aliphatic carbon using oxidoreductases. Can be enantioselective Hydroxylation

• Epoxidation of double bonds using lipases or oxidoreductases Epoxidation

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• Proteases

• Lipases, esterases/cutinases

• Oxido-reductases; laccases, peroxidases, chloroperoxidase, peroxygenase

• Amylolytic enzymes

NOVOZYMES PRESENTATION ACS 2012 Schäfer 31

• Opportunities: • Peroxygenases provides oxyfunctionality to

a range of different substrates Peroxygenases can be used i.e. in: • Hydroxylation reactions • Oxidation reactions • Polymerisation reactions

• Regio and stereo selectivity can be very high but depends on the actual substrate

• Peroxygenases operates under mild

conditions (pH 5-8; 30-50C), but is still relatively stable towards auxiliary chemicals (e.g. cosolvents, detergents etc.)

• Only waste product is water

Novel experimental unspecific peroxygenase catalyses hydroxylation reactions using only hydrogen peroxide

Aromatic epoxidation (e.g. naphthalene) Alkane hydroxylation (e.g. n-hexane) Epoxidation (e.g. styrene) Ether cleavage (e.g. Tetrahydrofuran) N-Oxidation (e.g. pyridine) Sulfoxidation (e.g. dibenzothiophene) Halide oxidation (e.g bromide, Br-)

Hofrichter (2010), Applied Microbiol. Biotechnology, 87

8/19/2012

Conclusions:

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• The sugar platform is ready for implementation

• ethanol will be deployed first

• biochemicals catching up…also from biomass

• Market pull for renewable chemicals

• ”Untraditional partnerships”

• combine agriculture, biology & chemistry and building new value chains

• new growth markets for grain processors, biotech companies, chemical companies and consumer goods companies


Thank you!

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