Novozymes’ innovation is wide-ranging, and we are pursuing a strategy of moving into new areas where we can apply our core technologies. In the enzyme business, we have set ourselves the target of promoting innovation and finding completely new and different ways of using enzymes.
Novozymes invested 13% of sales in research and development in 2006, an increase on 2005. This is due partly to our long-term growth initiative from 2005, when we decided to invest up to DKK 60 million more a year in market-expanding activities over a period of four to five years.
This DKK 60 million is being used primarily to discover and develop new business areas, partly through the New Business Development department created in 2005 to focus on new areas in enzymes and microorganisms. However, these new projects are still at a very early stage.
In connection with Novozymes’ 2005 strategic initiative, we have sharpened our focus on research projects with the potential for large returns. We have accepted higher levels of risk for these projects than for our other research projects. This increased risk exposure needs to be seen in the light of how Novozymes’ growing earnings capacity has put us in a better position to concentrate on accelerating growth.
Radical innovation in the core business
In enzyme research we have been focusing on radical innovation – in other words, the ability to discover new products, technologies or solutions which will make a fundamental difference in our customers’ markets, rather than simply improving existing products. In this context we have analysed the basis for innovation at Novozymes, our innovation culture, and even our research organisation. Actions taken include adapting our organisation and systems to promote a climate of innovation and provide a better platform for radical projects at Novozymes.
Patents protect the business
Novozymes protects its new knowledge and inventions through an active patenting strategy. We file patent applications for new products, processes and applications as early as at all possible. If anyone infringes our patents, we take the necessary steps to protect our intellectual property rights, where necessary pursuing the matter through the courts.
At the end of 2006 we had more than 5,000 granted or pending patents. We regularly adjust our patent portfolio to ensure that we retain only those that we believe are, or may one day be, important for our business.
Novozymes’ technological platform
Novozymes’ core technological expertise centres on enzymes and other protein molecules – from us discovering them to their production and their use by our customers or consumers.
Our most important technologies are:
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Quickly identifying the microorganisms which produce the particular type of enzyme we are after for a specific application. This technology is known as high throughput screening and is performed using Novozymes’ extensive collection of bacteria, fungi and yeasts.
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Modifying characteristics so that, for example, they are optimised for the conditions under which the enzyme will be used in the end-product. This technology is known as protein engineering.
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The design of efficient microorganisms which can secrete large quantities of enzymes. This means that we can use a number of gene technology tools to ensure that our enzymes can be produced in large quantities.
