evolution of basf's product portfolio growth clusters...market development plant biotechnology....
TRANSCRIPT
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Agricultural Solutions Sustainable growth through market-driven innovations
Dr. Peter Eckes President BASF Plant Science
BASF Roundtable Agricultural Solutions
New York & Monmouth
August 8, 2011
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BASF Roundtable Agricultural Solutions, August 8, 2011
Disclaimer
This presentation includes forward-looking statements that are subject to risks and uncertainties, including those pertaining to the anticipated benefits to be realized from the proposals described herein. This presentation contains a number of forward-looking statements including, in particular, statements about future events, future financial performance, plans, strategies, expectations, prospects, competitive environment, regulation and supply and demand. BASF has based these forward-looking statements on its views with respect to future events and financial performance. Actual financial performance of the entities described herein could differ materially from that projected in the forward-looking statements due to the inherent uncertainty of estimates, forecasts and projections, and financial performance may be better or worse than anticipated. Given these uncertainties, readers should not put undue reliance on any forward-looking statements.
Forward-looking statements represent estimates and assumptions only as of the date that they were made. The information contained in this presentation is subject to change without notice and BASF does not undertake any duty to update the forward-looking statements, and the estimates and assumptions associated with them, except to the extent required by applicable laws and regulations.
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BASF Roundtable Agricultural Solutions, August 8, 2011
1 | Introduction
2 | BASF Crop Protection
3 | BASF Plant Biotechnology
4 | Update Monsanto BASF Collaboration
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Market development plant biotechnology
Source: ISAAA 2010
Key factsGlobal GM crop area continued to grow in 2010Biotech crops cover about 10% of the cultivated land In 2010, 15.4 million farmers grew GM crops in 29 countriesMarket expected to grow to USD50 billion by 2025
Pipeline PlatformStrategy Partners
Global GM crop area in million hectares; 1 ha = 2.47 acres
Continued strong growth
0
20
40
60
80
100
120
148
140
20031997 2006 20102000
CAGR 22%*
* CAGR 1997-2010
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5
BASF Plant Science
Global research network at biotech hotspots
Ames Iowa
DNA LandMarks
RTP North Carolina
Crop Design
Limburgerhof
MetanomicsSunGene
Plant Science Sweden
HawaiiPuerto Rico
Midsouth
Ceara
Sao PauloSt. Catarina
Key factsFounded in 1998Leading platform for Plant Biotechnology 7 R&D and 13 field site centers750+ employees worldwideAnnual R&D spending~€150 million
Tamil Nadu
R&D sitesField site center
Pipeline PlatformStrategy Partners
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BASF Plant Science strategy
What?Increase crop yield through Plant Biotechnology
How?Focus on yield traits for major cropsDevelop the leading technology platform to deliver the best traits for the best seedAccess market through partnerships with leading seed companies
Trait Technology Partner strategy
Pipeline PlatformStrategy Partners
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BASF Plant Science partnerships
Strong partners for yield traits in major crops
* Wheat: very fragmented global market** Sugar cane: market data for Brazil only
(main producing country)*** Monsanto: including licensing business **** Rice: hybrid rice market excluding China
0 50 100 150 200 250
Sugar beet
Sugar cane**
Cotton
Canola
Soybean
Rice
Corn
Wheat*
Total harvested crop area GM crop area
Source: USDA, ISAAA, BASF Plant Science
Global GM crop areain million hectares; 1 ha = 2.47 acres
Pipeline PlatformStrategy Partners
Rankmarket share
Partner
-
****
***
***
2
1
2
2
1
1
1
*
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Plant Biotechnology pipeline Expected gross trait sales 2020 before partner share+: €1.9 bn.
Traittotal development time: 10-12 years
Stage IIearly product development
Stage Iproof of concept in target crops
Discoverygene identification & proof of concept
Stage IVpre-launch
Stage IIIadv. product development
Partners: *Monsanto **CTC ***KWS ****Bayer *****Embrapa
Higher-yielding corn*Higher-yielding soybean* 2Higher-yielding canola*
Higher-yielding sugar cane**
Drought-tolerant cotton*
Improved corn feedHealthy fatty acids in canolaAmylopectin potatoes
Drought-tolerant corn* 2
Nematode resistant soybean*Herbicide-tolerant soybean*****
Fungal-resistant potato
Higher-yielding sugar beet***
Yield & Stress
Input traits
Feed
Specialties
Fungal-resistant soybean
Higher-yielding rice****
Improved nitrogen utilization in corn*Higher-yielding wheat*
2 1
Advancement 2010 New project
1 generation
1
3
Innovation yields results
+ €1=USD1.3
Pipeline PlatformStrategy Partners
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EPA/DHA-omega-3 (Ω-3) fatty acid production in canola
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EPA/DHA-omega-3 (Ω-3) fatty acid production in canola
Key factsGrowing consumer interest in products with EPA/DHA-Ω-3 fatty acids due to proven health effects: arteriosclerosis prevention, decreasing risk of cardiovascular diseases Current EPA/DHA-Ω-3 market is expected to double to about USD2.8 bn. by end of decadeInnovative production of EPA/DHA-Ω-3 fatty acid in canola
New EPA/DHA Ω-3 food product launches
Opportunity for plant-produced EPA/DHA-Ω-3 fatty acids
0
250
500
1994 1996 1998 2000 2002 2004 2006 2008
Source: Frost and Sullivan 2009, BASF
EPA/DHA Ω -3 source in food product launchesFish60%
Algae18%
Unknown/Other22%
Pipeline PlatformStrategy Partners
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Elucidation of EPA/-DHA-Ω-3 biosynthesis
Scientific groundwork jointly established with academic partnersGenes identified and candidates for expression in plants selected from algal and fungal genomes
Transfer into plants
EPA/DHA-Ω-3 production of >500 different gene combinations tested in model and crop plantsIdentification of most promising gene combinations
Product development in canola
Concerted expression of 10 genes produce >20% EPA/DHA Ω-3 content in canola oil:– sustainable production– cost leadership position– ease of incorporation into food products– efficient scale-up
EPA/DHA-omega-3 (Ω-3) fatty acid production in canola
World record in plant metabolic engineering
Pipeline PlatformStrategy Partners
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Increased yield in rice
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Increased yield in rice
* Basis: corn USD144/MT, soybeans USD329/MT, wheat USD186/MT,rice USD224/MT
** Based upon a single 10% yield increase trait example, assuming 60-70% of value is kept by farmer, depending on product and crop
Crop Global Production
(million MT/y)
Global Crop Value*(billion USD)
Gross Sales Value 10% Yield Increase**
(billion USD)
Corn 866 125 ~4
Wheat 664 124 ~4
Rice 456 102 ~4
Soybean 263 87 ~3
Key factsRice is the world’s largest food crop. Half of the world’s population consumes at least one meal of rice every day Besides insect resistance and herbicide tolerance, yield increase in rice offers an attractive value potentialHybrid rice seeds are gaining popularity and market share from traditional varieties due to their ability to produce higher yields
Large market potential for increased yield in rice
Pipeline PlatformStrategy Partners
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3 8 104
Key hybrid rice markets
* estimated percentage of total rice market(M ac): million acres
Focus on future key hybrid rice marketsSource: USDA, BASF Plant Science
3%~20%
<1%~20%
30%~70%
Hybrid market* 2010:2020:
North America Brazil India
Total rice area (M ac):
Pipeline PlatformStrategy Partners
Hyb
rid m
arke
t (M
ac)
2010 20200
20
15
Hyb
rid m
arke
t (M
ac)
2010 20200
20
15
Hyb
rid m
arke
t (M
ac)
2010 20200
20
15
15
Increased yield in rice
Project goalDevelop & commercialize hybrid rice seeds that offer yield advantages of 10% over conventional hybrid rice
First partnership signed Global non-exclusive license agreement with Bayer CropScience (BCS) BASF Plant Science: trait development, de-regulationBCS: introgression of traits in its hybrids, commercializationFirst product launches expected by end of the decade
Target marketIndia and selected countries in SE-Asia, USA, Brazil
Seed count
Panicle size
Seed size
New partnership provides market access Control BASF
Pipeline PlatformStrategy Partners
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Discovery engine
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Deliver best trait genes
Select the best candidates
BASF Plant Science Trait technology platform
Large capacity at high speedYield in cropsAcquired by BASF in 2006
Worlds largest industrial-scale metabolite profiling platformInvestigates Mode of ActionFounded by BASF in 1998
ExpertiseScoutingProprietary dataPublic data Academic partners
Select the best genes Ghent
Understand gene action Berlin
Pipeline PlatformStrategy Partners
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Evaluation agreement with a technology management company
Select the best candidates
3-6
Timeline (months)
BASF Plant Science Trait technology platform
Pipeline PlatformStrategy Partners
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Filled seeds
Roots
Leaves
Panicle
Seed numberSeed
weight
Flowering
Total yield
Select the best candidates
Select the best genes
Yield increase in rice under standard and stress conditions:
Up to 30% yield increase Up to 20% more filled seeds
Mode of Action hypothesis:Reduced secondary stress effectsMaintains growth under limited conditions
3-6
12-18
Timeline (months)
Pipeline PlatformStrategy Partners
BASF Plant Science Trait technology platform
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2nd
metabolite s
amino acids
sugars & lipids
secondary metabolites
tbd
Select the best candidates
Select the best genes
Re-programmed central metabolism shifting towards sugars and lipids
Mode of Action confirmed: Reduced secondary stress effectsMaintains growth under limited conditions
Understand gene action
4-6
3-6
12-18
Timeline (months)
Pipeline PlatformStrategy Partners
BASF Plant Science Trait technology platform
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Deliver best trait genes
4-6
3-6
12-18
3-6
Timeline (months)
Select the best candidates
Select the best genes
Understand gene action
IP extended Definition of constructs and gene combinations
Pipeline PlatformStrategy Partners
BASF Plant Science Trait technology platform
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24-48
4-6
3-6
12-18
3-6
Timeline (months)
Deliver best trait genes
Select the best candidates
Select the best genes
Understand gene action
Field testing
On fast-track in Monsanto collaborationStrongest gene in Phase IPromoted to Phase II in 2010Successful results for 2 years in the field
5-6 years
Field trial results
20092010
Product concept
Event1 Event2 Event3 Event4 Event1 Event2 Event3 Event4
New promising events for collaboration
Pipeline PlatformStrategy Partners
BASF Plant Science Trait technology platform
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Plant biotechnology pipeline Expected gross trait sales 2020 before partner share+: €1.9 bn.
Traittotal development time: 10-12 years
Stage IIearly product development
Stage Iproof of concept in target crops
Discoverygene identification & proof of concept
Stage IVpre-launch
Stage IIIadv. product development
Higher-yielding corn*Higher-yielding soybean* 2Higher-yielding canola*
Higher-yielding sugar cane**
Drought-tolerant cotton*
Improved corn feedHealthy fatty acids in canolaAmylopectin potatoes
Drought-tolerant corn* 2
Nematode resistant soybean*Herbicide-tolerant soybean*****
Fungal-resistant potato
Higher-yielding sugar beet***
Yield & Stress
Input traits
Feed
Specialties
Fungal-resistant soybean
Higher-yielding rice****
Improved nitrogen utilization in corn*Higher-yielding wheat*
2 1
Advancement 2010 New project
1 generation
1
3
Pipeline PlatformStrategy Partners
Innovation yields results
Partners: *Monsanto **CTC ***KWS **** Bayer ***** Embrapa+ €1=USD1.3
Pipeline PlatformStrategy Partners
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Traittotal development time: 10-12 years
Stage IIearly product development
Stage Iproof of concept in target crops
Discoverygene identification & proof of concept
Stage IVpre-launch
Stage IIIadv. product development
Higher-yielding corn*Higher-yielding soybean* 2Higher-yielding canola*
Higher-yielding sugar cane**
Drought-tolerant cotton*
Improved corn feedHealthy fatty acids in canolaAmylopectin potatoes
Drought-tolerant corn* 2
Nematode resistant soybean*Herbicide-tolerant soybean*****
Fungal-resistant potato
Higher-yielding sugar beet***
Yield & Stress
Input traits
Feed
Specialties
Fungal-resistant soybean
Higher-yielding rice****
Improved nitrogen utilization in corn*Higher-yielding wheat*
2 1
Advancement 2010 New project
1 generation
1
3
Pipeline PlatformStrategy Partners
BASF / Monsanto collaboration leading in yield trait technology
Partners: *Monsanto **CTC ***KWS ****Bayer *****Embrapa+ €1=USD1.3
Pipeline PlatformStrategy Partners Pipeline PlatformStrategy Partners
Plant biotechnology pipeline Expected gross trait sales 2020 before partner share+: €1.9 bn.
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