Twenty months into her CEO role at Novozymes A/S, Ester Baiget is calling out an opportunity for the world’s largest enzymes maker to put disappointing growth behind it and double sales by 2030.
Having battled away in the cut-throat washing-powder market for years, the world’s largest enzyme company is focusing resources on high-growth areas and emphatically exploring how its microbe, enzyme and fermentation toolkit can be deployed in current hotspots like alternative protein, bio-health and biological fertilisers.
“The market opportunity here is huge, the sea enormous,” Baiget said in an interview with chemicalESG.
Staying on trend will mean prioritising investment and R&D, while picking up the odd bit of technology via acquisitions. One opportunity is premium alternative and plant-based protein given new product launches hit the supermarket shelves on an almost daily basis. Novozymes plans to spend about 300 million kroner on a network of hubs so it can work in proximity with customers in nutrition and health and keep pace with trends.
By contrast, it will restrict R&D funding in household care to the most promising projects, like its Freshness enzyme that prevents odours penetrating clothes. Novozymes isn’t walking away from detergents. It’s still a 3-4% a year growth market and, with sustainability a rising priority for companies like Unilever, there’s an opportunity for enzymes to play a larger part in reducing the amount of fossil fuel content.
But Novozymes still has a fight on its hands. International Flavors & Fragrances’ purchase of a key rival — the nutrition and biosciences business of DuPont in a $26 billion deal — enhances the offering of a key competitor in areas like plant-based burger patties. IFF is now able to couple its flavors, aromas and color additives business with an ability to extract protein from soya and pea and provide biotech solutions for shelf-life.
The Danish company is investing 2 billion kroner on a new production line in Nebraska to supply alt-based protein to an as-yet unidentified “key player in the plant-based industry.” Rather than be a bulk-protein provider, Novozymes will play in the premium space where consumers will be willing to pay for enhanced texture and meat-like characteristics. As long as Novozymes delivers the science, the novelty, and value, it’s not necessary to offer adjacent products, according to Baiget.
What about the flood of biotech startups? Competition there is limited, Baiget added.
“In many cases, they come with a gene, a microorganism or a protein but they are lacking the capability to bring it to scale,” the CEO said. “Yes you have that concept design, but then okay ferment it, then produce it at scale, then bring it to market globally, then make it in compliance with regional regulations.”