Fortune favors the brave and…Novozymes, Nestlé and Nike
It is sharing that space with conglomerates such as GSK, Nestlé and Nike.
Novozymes, wrote Fortune, has helped customers save 60m tons of CO2 emissions, and improve their water efficiency by 9% and energy efficiency by 15%.
“Innovation is the DNA of our company so it is great to be recognized for those efforts; ultimately we are focused on improving the footprint of animal production,” said Fredrik Ullman, director at Novozymes and responsible for its feed enzymes alliance with DSM.
DSM, incidentally, was another feed additive company making the grade – it ranked at 42 on the Forbes publication’s Change the World list.
The 50 companies included have annual revenues of $1bn or more. They were assessed for ‘their sizable impact on major global social or environmental problems’ in their competitive strategy.
Ullman said doing more with less is the lynchpin of R&D strategy at the Danish company.
Microbes and Monsanto
Such an efficiency driver, he said, underpins the firm’s joint venture with Monsanto, the BioAg Alliance. “There was no other partner that can deliver innovation on that scale,” he stressed.
The partnership is aimed at developing microbial strains with the potential to increase productivity of corn and soy crops.
“In 2015, the Alliance tested more than 2,000 microbial strains across 500,000 field trial plots in more than 50 locations in the US," said Ullman. The companies said results from the US field trial program showed its top new microbes increased corn yields by an average of 4 to 5 bushels per acre and soy yields by an average of 1.5 bushels per acre.
Under the agreement, Monsanto and Novozymes are maintaining independent research programs to identify microbial targets. Novozymes is responsible for production and supply of the microbial solutions to Monsanto, while Monsanto is leading field testing, registration and commercialization of all alliance products.
The alliance has flagged up its intention to release a new corn inoculant product on the US market in 2017. Inoculant products are said to help plants with nutrient uptake, and this is the first such corn inoculant, said Novozymes, for application upstream, so for use by the seed company itself rather than by the farmer.
“We have great expectations for this product,” said the Danish firm a few months back.
Extracting more value from enzymes…
Novozymes invests some 14% of its revenue back into R&D, with animal feed taking up an increasing chunk of that over the past number of years, said Ullman.
On the feed enzyme side of business operations, the fundamentals behind its partnership with DSM remain strong, he said.
The two companies are looking now to learn more about the functionality of enzymes beyond mere reduction of feed costs through sparing of inorganic phosphorus or amino acid digestibility: “We are continuously conducting trials to see how we can extract more value from enzymes. The goal of ongoing investment is to gain technical insights and more understanding of how to use phytase or protease enzymes, for example,” said Ullman.
The antibiotic free production trend is also informing research efforts. “We are actively exploring the role of enzymes in gut health,” he said, adding that probiotics were part of that particular agenda also.
In terms of substrate degradation, the market typically relies on xylanases and broad specturm wild types today, said Ullman. "However, we see great potential for many other types of enzymes to break the current limit for how much energy can be released," he added.
And the market, he said, can expect innovation in the enzyme space from the alliance in the “very foreseeable future.”
“But this is a long journey. Enzymes are highly complex. We have to be patient in terms of breakthrough. We are pioneers in the protease segment but it took us some 10 years to get to the market dominant position,” said Ullman.
Projects are very much joint efforts, he said. “DSM carries out the in vivo research and Novozymes the in vitro trials.”
And the alliance, which in the main focuses on the poultry and swine sectors, has seen growth on average of 9% compound annual growth rate (CAGR) per annum since it started back in 2001, said Ullman.
Financial faring
Novozymes first half results for 2016 showed a strong performance in feed, which it said was partly driven by weak comparison level and timing.
“Protein-enhancing enzymes continued to deliver strong growth. Our carbohydrases were also positive, while phytases were on par with last year. Interest in trialing our recently launched probiotic, Alterion, is increasing, but sales are still small,” reported the group in August.
