09 CeoMeeting- Keynote


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  • BVA-020119-130-20070603-GE4-v6(Novozymes Board Meeting)
  • 09 CeoMeeting- Keynote

    1. 1. Innovation in the Emerging Biobased Economy Roger Wyse Co-Chairman MLSCF Managing Director Burrill & Company “ Innovation Without Boundaries” CEO’s Life Sciences Conference
    2. 2. Presentation Outline <ul><li>Malaysia’s Innovation Driven, Knowledge Based Economic Growth Strategy </li></ul><ul><li>Why is innovation important? </li></ul><ul><li>What are the future drivers of innovation </li></ul><ul><li>Opportunities </li></ul><ul><li>Keys to success </li></ul>
    3. 3. Messages <ul><li>Just as Malaysia has done in the past (Oil palm, Rubber, Teak) it must now look globally for innovation that will drive it to achieve developed nation status in 2020. </li></ul><ul><li>Future innovation will be driven by global megatrends leading to a “Green Economy”. </li></ul><ul><li>The life sciences based technologies will be major contributors to addressing the challenges </li></ul><ul><li>The market opportunity is large, some estimate 25% of global GDP. </li></ul><ul><li>Thus the theme of this meeting and the potential partnership embodied in this audience </li></ul>
    4. 4. Just Two Years Ago: Malaysia Endorsed An Economic Growth Strategy Based On Innovation
    5. 5. Strategy recognized need to invest locally but access globally Indeed the Biotechnology Policy based on the same principle had been implemented a just one year earlier
    6. 6. Why is Innovation Important? <ul><li>Drives economic growth </li></ul><ul><li>Creates jobs </li></ul><ul><li>Creates wealth and social well being </li></ul><ul><li>Addresses societal therefore market needs </li></ul><ul><li>Enables flexibility to address emerging needs </li></ul>
    7. 8. Future Innovation Drivers – Back To Basics <ul><li>Food security </li></ul><ul><li>Energy security </li></ul><ul><li>Global climate change </li></ul><ul><li>Sustainability </li></ul><ul><li>Needs of an aging population </li></ul><ul><li>Large Growing Markets: India & China </li></ul>
    8. 9. BUILDING A BIOBASED ECONOMY DEMANDS NEW “GREEN TECHNOLOGIES” <ul><li>Necessity is the Mother of Invention </li></ul>
    9. 10. Get Creative: Why Green Innovation is the Key to Business Growth--Even in Tough Times by Andrew Winston Harvard Business Review August 2009
    10. 11. A $100 Billion Plus Revenue Industry, 2009 $89 B $22 B $8 B A $260 Billion annual investment in Life Sciences
    11. 12. By 2030 the “green economy” is projected to represent 25% of global GDP
    12. 13. Food Security We have options: Agriculture Biotechnology Increase productivity Reduce inputs, improve nutritional value Reduce environmental impact
    13. 14. The Demands for Agriculture on Increasing Index (1970 = 100) Freshwater ecosystems Source: United Nations, 1999 More food and now fuel on less land with half the water 100 90 80 70 60 50 40 1970 75 80 85 90 95 99
    14. 15. The Future Of Ag Inputs Is At The Intersection Of Breeding And Trait Technologies Breeding Biotech Traits <ul><li> productivity (complex) </li></ul><ul><li> reliability </li></ul><ul><li> quality </li></ul><ul><li>Integration of native and biotech traits </li></ul>Seed is the carrier of genetic information <ul><li>Pest protection </li></ul><ul><li>Stress alleviation </li></ul><ul><li>Superior nutrient use </li></ul><ul><li>Enhanced nutrient density </li></ul><ul><li>Elevated safety </li></ul><ul><li>Processor friendly </li></ul>Chemistry <ul><li>Pest control </li></ul><ul><li>Nutrition </li></ul><ul><li>Growth regulators </li></ul>Gene Gun Agrobacterium Nearly 150 M Acres Not in Corn Cultivation ! Corn Yields U.S. Average Bu/Ac Biotech
    15. 16. Biotech crop cultivation continues to grow Trait Hectare Growth: 22 Percent from 2006 to 2007 118 Mha to 144 Mha Cumulative biotech crop acres: 2 Billion Acres, reached in 2008 55 million farmer decisions 13+ million farmers cultivated Biotech crops in 2008 11+ million resource poor farmers
    16. 17. High Yield Trait With Trait Without Trait Average Soybean Yield Advantage Over Control <ul><li>Key Features: </li></ul><ul><li>Improves farmer productivity </li></ul><ul><li>Enables current ag hectares to supply increased global demand for calories, oil & protein </li></ul>Nitrogen Response Rice With trait Without trait Enhanced Yield & Nitrogen Response
    17. 18. Source: Cotton Corporation of India Technology Has Reshaped Cotton Farming And The Textile Industry Of India Hybrids Biotech Indian Bt cotton acreage for 2008 - 80% of Hybrid market! Bollworm/Budworm sprays reduced from 5.9 to 1.4 Total insecticide costs reduced Lint yield increased by 37 lb. per acre 60 M jobs in India Dependent on Cotton
    18. 19. Near to Market Traits <ul><li>Increased yield </li></ul><ul><li>Drought tolerance and water use efficiency </li></ul><ul><li>Nutrient use efficiency </li></ul><ul><li>Increased spectrum of pest and disease resistance </li></ul><ul><li>Gene stacking technologies that will reduce cost and time to market of complex trait combinations </li></ul>
    19. 20. Big Opportunity In Palm <ul><li>Foundation for accelerated genetic improvement in place </li></ul><ul><li>Increased productivity per unit land – key to sustainability </li></ul><ul><li>Reduced inputs </li></ul><ul><li>Increased down stream value </li></ul>
    20. 21. Energy Security
    21. 22. European View of Energy Security EU
    22. 23. US View of Energy Security <ul><li>Geopolitical unrest wherever oil is produced </li></ul><ul><li>Extreme weather demonstrated the vulnerability of supply </li></ul>
    23. 24. Renewable Biofuels, Materials and Chemicals Increased recovery of oil We have options: Industrial Biotechnology
    24. 25. Biomass sourced fuels are expected to take 12-14% of the global gasoline market by 2015; 25% of by 2030 Big oil is investing Shell Chevron ExxonMobil Dupont ConocoPhillips Totale Petrobras
    25. 26. Biomass is Key to a Sustainable Future
    26. 27. Future of Non-hydro Energy Generation is Biomass EIA-Annual Energy Outlook 2009. Early Release
    27. 28. The Biomass Feed Stock is Key <ul><li>Investment Opportunities </li></ul><ul><ul><li>Increased productivity </li></ul></ul><ul><ul><li>New Energy Crops </li></ul></ul><ul><ul><li>Conversion technologies </li></ul></ul><ul><ul><li>Fermentation Products </li></ul></ul><ul><ul><li>Carbon sequestration </li></ul></ul><ul><ul><li>Technology integration & adaption </li></ul></ul>Food Feed Renewable Feedstocks Enhanced Yields Lower Inputs Energy Crops Conversion
    28. 29. A Bio-Refinery Industry is Emerging Petrochemical Industry Fuels: Gasoline, diesel Chemicals Materials Feedstocks and intermediates Crude oil and natural gas Hydrocarbons Biobased Industry Plant biomass and wastes Sugars, oils, etc. Fuels Bulk and Specialty Chemicals Biofuels: Alcohols, Alkanes Biodiesel BioChemicals BioMaterials Concept is not new, 100’s of biorefineries currently are in operation
    29. 30. White biotech (biofuels/industrial biotech and other) sales expected to grow significantly and increase share over the next 5 years… White biotech Sales chemical industry* <ul><ul><li>Market growth; process conversion; new bio-based ingredients </li></ul></ul><ul><ul><li>Growth with customer markets; new applications </li></ul></ul>Assumptions * Current chemical industry sales excluding B2C sales in pharma and personal care ** Top-down estimate based on industry interviews Source: SRI, FO Licht, Frost and Sullivan, Press clippings, McKinsey EUR billions 100% = EUR 1,300 billion <ul><ul><li>Increase share of oleo vs. synthetic surfactants but decreasing prices </li></ul></ul><ul><ul><li>Moderate growth in new products/services </li></ul></ul><ul><ul><li>Continuation of current very strong growth in biofuels </li></ul></ul><ul><ul><li>Moderate growth in hydrocolloids, strong growth in botanicals </li></ul></ul><ul><ul><li>Increasing use of biocatalysis and higher share of biologics </li></ul></ul><ul><ul><li>Moderate penetration of new bio-polymers and bio-based bulk chemicals </li></ul></ul>Bio-dependent sales 2010 Segment Biofuels Pharmaceutical ingredients Bulk/polymers Food/ feed ingredients Oleochemicals Enzymes Others Total Bio Plant extracts 42 23 20 15 11 8 4 2 125 90 50% Of Growth In $1 trillion Chemical Industry 2005 basis 2005 - 10 growth
    30. 31. Obama driving a Green Economy <ul><li>Increased research funding </li></ul><ul><li>Incentives for use of renewables </li></ul><ul><li>Subsidies </li></ul><ul><li>Loan guarantees </li></ul><ul><li>Conducive policies and regulations </li></ul><ul><li>Cost effective opportunity for Malaysia: </li></ul><ul><li>Adapt to Malaysia markets </li></ul>
    31. 32. Synthetic biology offers exciting prospects Example: Microbial synthesis of artemisin
    32. 33. Algae is Hot !! Near Term - could be in Carbon Capture
    33. 34. Advanced biofuels & Second Gen Feedstocks <ul><li>Biobutanol Potential </li></ul><ul><li>Renewable </li></ul><ul><li>Improved performance (higher energy, lower VP) </li></ul><ul><li>Compatible with current systems </li></ul><ul><li>Cost competitive </li></ul><ul><li>Energy security </li></ul><ul><li>Building block for other fuels, chemicals </li></ul>
    34. 35. Opportunity for Malaysia The Palm Biorefinery Long – Term Opportunity: 5 – 10 years FFB CPO Fertilizer Biofuels, Chemicals, Materials Sugars Fermentation Units Fertilizer Plantation Specialty Chemicals Plantation Fronds Trunks Biorefinery
    35. 36. The Future Is Bright But Must Be Entered Carefully Energy Security Global Climate Change Drivers of a Green Economy Context for Development Food Security Sustainable Agricultural Production Food Biomass Biorefinery
    36. 37. Healthcare Biotechnology
    37. 38. Targets of opportunity <ul><li>Healthcare </li></ul><ul><ul><li>Personalized medicines and delivery </li></ul></ul><ul><ul><li>Infectious disease </li></ul></ul><ul><ul><li>Diagnostics </li></ul></ul><ul><ul><li>Clinical trials </li></ul></ul>
    38. 39. The Three Forces Shaping the Evolution of Healthcare <ul><ul><li>Source: George Poste </li></ul></ul>access, cost and quality of care proficient use of information (e.health) molecular and personalized medicine
    39. 40. Longer Term Risk Assessment (prediction) Driving to Prevention: <ul><li>Genome wide association studies not just BRAC 1&2 </li></ul><ul><ul><li>Navigenics </li></ul></ul><ul><ul><li>DeCode </li></ul></ul><ul><ul><li>23andMe </li></ul></ul><ul><li>Shorter term, high accuracy risk assessment/clinical support tools </li></ul><ul><ul><li>Proventys </li></ul></ul><ul><ul><li>Labcorp </li></ul></ul><ul><ul><li>Quest </li></ul></ul><ul><ul><li>Roche </li></ul></ul><ul><ul><li>Genomic Health </li></ul></ul><ul><ul><li>XDx </li></ul></ul><ul><ul><li>CardioDx </li></ul></ul>Right Drug, Right Disease, Right Time Predisposition
    40. 41. Pharma is looking to diagnostic partners to support their therapeutic activities Pharma Diagnostic Partnership Deals
    41. 42. Big “New” Markets <ul><li>Alzheimer's/memory </li></ul><ul><li>Obesity/diabetes/metabolic disease </li></ul><ul><li>Anti-aging </li></ul><ul><li>Anti infectives (antibiotic resistance) </li></ul><ul><li>Wellness (preventative/predictive cure) </li></ul>
    42. 43. Overall Indexed Clinical Trial Costs Major Cost Factor in Drug Development Malaysia should be high value not low cost option
    43. 44. Out-sourcing / off-shoring <ul><li>Out-sourcing </li></ul><ul><ul><li>Subcontracting to a third-party company </li></ul></ul><ul><li>Off-shoring </li></ul><ul><ul><li>Relocating business processes from one country to another </li></ul></ul><ul><li>Is it happening? </li></ul><ul><li>YES! </li></ul>
    44. 45. The Case for Wellness <ul><li>Global functional foods market expected to be $167B by 2010, growing 14% annually </li></ul><ul><li>Global nutraceuticals market $228B in 2007 – unreimbursed! </li></ul><ul><li>30-60% of health plan claims are related to health risks that are modifiable by nutrition, exercise, stress reduction, etc. </li></ul><ul><li>Well-managed employer health and productivity management programs return $6-15 for every dollar spent </li></ul><ul><li>Cost of smoking: healthcare cost of smoking over a lifetime $220K per person = $40 in healthcare cost per pack of cigarettes smoked! </li></ul><ul><li>67% of the US population is overweight or obese, and 12% of healthcare costs are obesity-related </li></ul><ul><li>Source: Wellness Councils of America </li></ul>
    45. 46. The Obesity Epidemic % Overweight and obese in adults 20-74 years old 0 10 20 30 40 50 60 70 1960- 1962 1976- 1980 1999- 2000 2003- 2004 Overweight Obese
    46. 47. Opportunities for Malaysia <ul><li>Healthcare delivery (monitoring) – leverage ICT </li></ul><ul><li>Clinical trials – multi ethnic population, value added genotyping possible </li></ul><ul><li>Manufacturing of Biologicals </li></ul><ul><li>Diagnostics – leverage design, engineering, mfg </li></ul><ul><li>Re-purposing of drugs for the Asian markets </li></ul>
    47. 48. It Is All About Commitment, Persistence, And Execution Timing is now; Markets are open Valuations are attractive Technology is ready
    48. 49. Key Elements of Success Policy Regulatory Research Talent Capital Infrastructure
    49. 50. San Diego’s High Tech History 1955 - General Atomics 1956 - Scripps Clinic & Research Center 1960 - UCSD Founded 1963 - Salk Institute 1968 - Linkabit 1978 – Hybritech 1985 – UCSD CONNECT and Qualcomm Founded 1990-93 – 63,000 Jobs Lost 1995 – New Boom Need an Acceleration Strategy: Organic is too slow! 1960 1970 1980 1990 2000 Series of Catalytic Events VC Funding
    50. 51. Need To Invest Locally But Access Globally Adapt The “Open Innovation” Strategy Of Innovation Driven Corporations
    51. 52. The Innovation Path Capital Efficient, Quicker, More Flexible Basic Research In Market Applied Research Proof of Concept Development Commercial Launch Global Innovation Pathway Execute in Malaysia Access Globally
    52. 53. Short Term Strategy Next 5 Years A Market Driven Strategy
    53. 54. Medium Term Strategy 5 – 10 Year Horizon A Market Informed, Technology Enabled Strategy 2009 - 2017 Define New Markets where Malaysia can have a sustained competitive advantage. Evaluate and access innovation early that will position Malaysia in future market areas with a sustainable competitive advantage Basic Research In Market Applied Research Proof of Concept Development Commercial Launch
    54. 55. Action Plan <ul><li>Integrate global innovation with Malaysia’s Sustainable Competitive Advantages </li></ul><ul><li>Translate basic R&D investments in EU and US into applications in Malaysia – Invest in targeted translational R&D </li></ul><ul><li>Set Policy Targets – Ex. – US RFS </li></ul><ul><li>Invest globally in innovation rich companies starved for capital ; in return get rights for Malaysia , operations in Malaysia, partnerships with Malaysian companies and institutes </li></ul><ul><li>KEY: Build a streamlined system for bringing the technologies back to businesses in Malaysia </li></ul>
    55. 56. Messages <ul><li>Just as Malaysia has done in the past (Oil palm, Rubber, Teak) it must now look globally for innovation that will drive it to achieve developed nation status in 2020. </li></ul><ul><li>Future innovation will be driven by global megatrends leading to a “Green Economy”. </li></ul><ul><li>The life sciences based technologies will be major contributors to addressing the challenges </li></ul><ul><li>The market opportunity is large, some estimate 25% of global GDP. </li></ul><ul><li>Thus the theme of this meeting and the potential partnerships embodied in this audience </li></ul>
    56. 57. Enjoy the next two days, network, explore opportunities Great opportunities exist in this room
    57. 58. Thank You “ Innovation Without Boundaries” CEO’s Life Sciences Conference Malaysian Life Sciences Capital Fund www.mlscf.com