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Nutritional Products' solutions by tyty722

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The presentation on the innovation part of DSM        • Chapter 3: Technology leadership
Nutritional Products contains the following             This chapter shows examples of DSM Nutritional
subjects:                                               Products’ capabilities on innovation of new
                                                        formulations and new synthetic routes and
• Chapter 1: The innovation process                     processes. These examples confirm DSM
  Chapter 1 describes the overall innovation            Nutritional Products’ position as a technology
  process from the discovery phase of a new             leader.
  product or formulation, to its further
  development, the registration/approval process
  and finally the launch.

• Chapter 2: Market needs and DSM
  Nutritional Products’ solutions
  Chapter 2 gives examples on how the important
  needs in the market of nutritional products drive
  the innovation process. In the area of Human
  Nutrition and Health solutions for risk reduction
  in diabetes, and cardiovascular disease are
  described. In the area of Animal Nutrition and
  Health solutions like alternative growth
  promoters for enhanced feed conversion, and
  emission reducers are presented, and in the area
  of Personal Care a unique product for UV
  protection is illustrated.
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• DSM Nutritional Products’ target innovation            health and performance of animals, and at the
  areas are defined as solutions to the needs of the     same time address animal welfare issues.
  market, provided by DSM Nutritional Products’          In addition, there is an increasing concern about
  technology base.                                       the phosphate and ammonia amounts in the
                                                         excretion of farming animals. Feed additive
• The major industry trends and needs in the             solutions that help to reduce these emissions are
  Human Nutrition and Health markets are the key         needed and will help to provide a healthier
  drivers for the development of new products and        environment.
  concepts at DSM Nutritional Products.
  The growing health awareness, the changing of        • The dominant trends in the Personal Care market
  peoples lifestyles and the aging population            are driven by the aging population and an ever
  increase the demand for health ingredients and         better educated consumer. There is a growing
  for new scientific concepts to prevent diseases        evidence showing that lifelong exposure to UV-
  such as diabetes, cardiovascular, cancer, etc.         radiation strongly damages skin and hair.
  A growing body of scientific evidence suggests         The trend in cosmetics is changing from ‘covering
  that functional foods will help to reduce risks of     and mimicking’ to ‘curing and preventing’.
  diseases.
                                                       • DSM Nutritional Products is capable to find
• In Animal Nutrition and Health there is a              tailor-made solutions for each application to meet
  continuous challenge to increase the feed              the customers specific needs. DSM Nutritional
  conversion rate. Since the use of antibiotics as       Products’ competences are key for delivering
  growth promoters is going to be banned as of           new products, forms and applications.
  2006, there is a growing demand for alternative
  products. An important alternative to antibiotics    • DSM Nutritional Products aims to launch a
  are eubiotics. Eubiotics are products based on         number of ingredients and forms for each segment
  natural substances that maintain or enhance the        every year to generate a sustainable growth.
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• The innovation machine is systematically filled      • Examples of recently introduced innovative
  from different sources. Ideas and opportunities        products that were developed in house are
  are generated in-house, or sourced externally in a     TeavigoTM and Lycopene for the Human Nutrition
  systematic way to ensure a constant flow through       and Health segment, and HyD® for
  our innovation pipeline. These ideas and               the Animal Nutrition and Health segment.
  opportunities are translated via the innovation        Other products like LAFTI® for gut health and
  machine into new compounds, new forms and              Vevovitall® for pig feed are examples of products
  applications and even into new business models.        that are produced by DSM Food Specialties and
                                                         DSM Fine Chemicals respectively, and are
• There is a strong interaction between the various      brought to the market through DSM Nutritional
  marketing, sales and R&D departments.                  Products’ broad marketing network.
  The trends and needs in the market are
  continuously monitored by the marketing and          • DSM Nutritional Products has a strong
  sales staff. These trends and needs are                innovation track record and continues to build on
  subsequently matched with the available                this through the well established innovation
  scientific tools at DSM Nutritional Products.          process.
  The combination of market and scientific
  information is used to determine business models
  and plans.
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• DSM Nutritional Products has established a very          • After the launch of a new product or formulation
  well defined innovation process. The process is            the market success is reviewed, additional R&D
  divided in several project phases that as a                and market research might be performed and the
  combination will lead to an efficient translation          production process is further optimized.
  of an idea into the launch of a new product or
  formulation.                                             • During the overall innovation process a
                                                             governing practice is in place to ensure that
• In the discovery phase opportunities are                   project milestones are met and critical issues are
  generated, identified and subsequently described           quickly addressed.
  and recorded in a specified and well defined
  document. These opportunities are evaluated on           • Registration is a key factor in developing new
  their possibilities and future success factors.            products and forms for Human Nutrition, Animal
  Already in this phase there is a strong focus on           Nutrition and Personal Case. Safety assessments
  the possibilities for differentiation through              are in a number of cases the time determining
  various product formulations.                              factor. This key factor is addressed in an early
                                                             phase of the process to ensure that the
• During the feasibility study key topics are                requirements of regulatory authorities are met.
  resolved and the concept is proven through a
  limited number of laboratory experiments.                • Whereas a typical project in our process lasts only
  When necessary some small adjustments to the               3-4 years and the related costs are in the range of
  overall business plan are implemented.                     € 15-30 million, the costs related to the
                                                             development of a new pharmaceutical are up to a
• After successful feasibility testing, the project will     factor of 20 higher.
  proceed to its research and development phase in
  which many lab experiments are performed and             • Throughout the innovation process we
  the production process is developed. In the next           continuously build our patent position in
  phase the registration is prepared and                     processes, form technologies and applications.
  subsequently the launch.
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• For each health segment (like diabetes,                  Using well designed and specific assays the
  cardiovascular, bone health, etc.) specific              activity levels of a large variety of compounds are
  screening assays are established, targeting a            measured. In a rapid automated process the
  specific health benefit. To this extent the critical     natural product library is screened against the
  biochemical pathway is determined for each               assay and the highest potential future product
  health segment, in order to be able to specifically      candidates for various applications are accurately
  target that pathway on a molecular level.                selected.
  Once the targeted pathway has been determined,
  new active compounds need to be identified that        • Each active candidate targets a specific health
  can interact with the most important receptors           segment to which it will give beneficial effects.
  within this biochemical pathway, in order to             These health benefits may include risk reduction
  prevent specific disorders and diseases.                 for chronic impairments, the prevention of
                                                           certain diseases or the enhancement of the body’s
• In the identification of new products for Human          functioning and well-being.
  Nutrition and Health, Animal Nutrition and
  Health and Personal Care there is a strong focus       • In the follow-up step the carefully screened
  on products from nature. Nature has optimized            candidates are evaluated for further
  compounds over thousands and thousands of                development.
  years. The initial compounds considered for
  development are those that are ideally a part of
  the food chain and have a history of safe use.

• For this purpose DSM has a library of over
  80,000 natural products and extracts. These are
  pure compounds of extracts from natural
  biosources like fruits, vegetables and other tools.
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• Before a new active compound is registered a             At the same time these studies form a high entry
  complete registration dossier needs to be                barrier for competitors.
  delivered to the various authorities. The dossier
  combines the results from an extensive series of       • Regarding the efficacy studies several animal and
  safety and appropriate efficacy studies. Safety is a     human tests are performed to not only measure
  key point in the registration of new active              the effect but also to understand the mechanism
  compounds for the food and feed industries.              behind the effect. This should result in a
                                                           plausible explanation of the measured effects and
• DSM Nutritional Products’ safety package                 should elucidate the exact working mechanism.
  complements the history of safe use of its
  products by state-of-the-art scientific evidence.      • The registration files have to meet different
  During the safety studies in-vivo experiments are        regulatory frameworks all over the world.
  performed to measure the effect of the active            The framework in the US is best defined and the
  compound on the Adsorption in the body, the              most efficient, whereas in Europe it differs
  Distribution in the body, its effects on the             substantially per country.
  Metabolism of the body and finally the Excretion
  of the compound. This is summarized as ADME.           • The efficacy effects in the nutritional field are
  The safety studies are performed in two different        more difficult to demonstrate than the effects in
  phases. The so-called subchronic studies are             the pharmaceutical field. Since our nutritional
  relatively short studies of a couple of months,          products already have a safe history due to their
  whereas the subsequent chronic studies, i.e.             natural origin, nutritional products can be
  multi-generation studies, are generally performed        developed faster than pharmaceuticals.
  in about 2-3 years.                                      Overall, the duration and costs involved in the
                                                           nutritional field are much less than for pharma.
• These safety studies test if a specific active           A typical project in the nutritional process lasts
  compound can be used safely for an extended              only 3-4 years, including the registration process,
  period of time. In the nutritional field safety is       and the related costs are in the range of
  key and DSM Nutritional Products delivers a              € 15-30 million, which is less than 10% of the
  sound and extensive safety package.                      costs that is spent on a new pharmaceutical.
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• During the last century, progress in nutrition and          that an increasing number of this group relates to
  hygiene have increased peoples life expectancy.             very young people. In total chronic diseases
  In parallel, however, changes in human behavior             already account for more than 60% of the overall
  and lifestyle have resulted in a dramatic increase          health costs and this will only increase in the
  in chronic diseases. Especially the past two                years to come. Healthcare costs the consumer a
  decades have seen an explosive increase in the              major part of the GDP.
  number of people diagnosed with diabetes,
  cardiovascular diseases (CVD) and obesity.                • Longer periods of elevated glucose levels in the
  An increasing percentage of cardiac and diabetes            blood will lead to a complex range of
  patients are overweight, have increased blood               malfunctions and serious diseases like diabetes
  sugar, dyslipidemia and hypertension.                       type II and CVD. Diabetes type II (Non-Insulin
  This condition is called the metabolic syndrome.            Dependent Diabetes Mellitus, NIDDM) is a
  It is a cluster of risk factors that is responsible for     growing problem in many developed and
  much of the excess cardiovascular disease                   developing countries. It accounts for 90% of the
  morbidity among overweight and obese people,                global cases of diabetes. Onset of diabetes type II
  and people with diabetes type II. In conjunction            is characterized by progressive loss of control
  with genetic susceptibility the metabolic                   over the blood glucose level.
  syndrome is brought on by environmental and
  behavioral factors such as sedentary lifestyle,           • Individual lifestyles and nutrition plays a key role
  overrich nutrition and obesity.                             in preventing these diseases. Nutritional science
                                                              can help to find solutions to the increase of
• The support of healthy aging, by a.o. the                   chronic diseases. Nutritional science has proven
  prevention of this syndrome, is seen as one of the          that chronic diseases can be delayed or even
  greatest challenges of the 21st century. Currently,         prevented by adapting peoples nutrition to their
  a quarter of the US population suffers from the             genes. On the consecutive pages two examples
  metabolic syndrome and other populations show               relating to diabetes and cardiovascular diseases
  a similar trend. Even more worrying is the fact             are described.
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• For each health segment DSM Nutritional                A library of pure compounds and several libraries
  Products established screening assays targeting a      of plant extracts were screened for PPARγ-
  specific health benefit. Generally these health        agonists on the molecular level. It is well
  benefits are the result of interactions between an     documented that PPARγ is a key regulator of
  active compound and specific malfunctions in the       glucose control and energy metabolism. PPARγ
  biochemical pathway that is responsible for a          agonists lead directly to lower blood glucose
  certain disease.                                       levels.

• For each health segment the critical biochemical     • Often the initial screen is not sufficiently
  pathway is determined in order to be able to           selective, and a highly sophisticated combination
  specifically target that pathway on a molecular        of additional filters is necessary and will finally
  level. These molecular targets are used to screen      lead to the identification of product candidates
  a library of natural compounds on their activity       for further development.
  and selectivity levels.

• An appropriate molecular target is selected to run
  through the high throughput screening. The lead
  candidate compounds are further evaluated by in-
  vitro assays, in-vivo animal experiments and
  eventually in human studies.

• On the right side an example is given for glucose
  metabolism. Blood glucose control is one of the
  prominent target segments in DSM Nutritional
  Products’ business strategy for Human Nutrition
  and Health.
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• The selection criteria in the overall screening         • The result of this screen is a convincing proof of
  process are rational step-by-step filters.                DSM Nutritional Products’ R&D approach in the
  For the target segment blood glucose control,             search for new nutraceuticals with strong health
  DSM Nutritional Products can look back how the            benefits. With this highly sophisticated discovery
  step-by-step selection to the developmental               platform DSM Nutritional Products created a
  compound has been successfully completed.                 unique position within its industry.
  DSM Nutritional Products has established a
  library of extracts with a high diversity.
  Besides choosing the appropriate molecular
  target, such a library is key for successful high
  throughput screening.

• In a first broad screening, starting from more than
  80,000 plant extracts, the primary hits were
  selected. These primary hits still amount to about
  5% of the total number of compounds of the
  overall library. These primary hits were screened
  in a consecutive phase of validation experiments
  that lead to a series of validated compounds.
  The overall combination of several high
  throughput screening assays lead to 100 validated
  compounds.

• Additional selection criteria like safety,
  accessibility and ability to create entrance barriers
  through patents, further reduced the number of
  lead compounds to 32.
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• To be able to investigate effects of the active         drug benchmark (called TZD10), but to have an
  candidate compound on the glucose metabolism            analogue reduction profile and overall a highly
  in-vivo, established animal models for diabetes         significant effect.
  have been developed.
                                                        • The depicted data show the effect of the natural
• During the tests the effect of the active               product on blood glucose level. For the natural
  component is measured and studied.                      product, as well as for the entire product class
  In addition, a so-called dose-response-relationship     and combinations with other products (like
  is established in order to demonstrate the efficacy     Biotin) a series of patents has been filed.
  in relation to the dose. Pharmacological drugs          The active component is a new benchmark for
  that act via the same mechanism are tested in           risk reduction in diabetes and will be launched in
  parallel as a positive control.                         the market place in the shortest possible time.
  The pharmacological compounds provide an
  important parameter for determining a
  compounds’ efficacy and allow to determine the
  correct dose of the active nutraceutical
  compound for human use.

• Since DSM Nutritional Products’ nutraceutical
  products focus on prevention instead of curing,
  the general objective is to find products that
  work in a nutritional amount, rather than the
  relatively high amounts typically used as
  pharmaceutical drugs. Also it is clearly not the
  objective to employ nutritional ingredients to
  lower blood glucose levels to an extent as the
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• Lycopene is the major carotenoid in tomatoes,         oxidation. Epidemiological studies also show that
  giving this fruit its attractive red color.           intima thickness of the common carotid arteries
  Recently, there has been increasing scientific        is significantly lower in individuals with higher
  evidence suggesting that this nutrient might play     lycopene plasma.
  an important role in the prevention of chronic
  diseases such as cardiovascular diseases (CVD)      • The research group also found that pure lycopene
  and cancer, particularly prostate cancer.             significantly reduces the effect of the male
  Several epidemiological studies have shown that       hormone androgen on the prostate.
  men who frequently consume tomato-based               Androgens are the key drivers in the
  foods are less likely to develop prostate cancer.     development of prostate cancer in men over a
  Moreover, high blood levels of lycopene were          lifetime. State-of-the-art nutrigenomics
  associated with a lower prostate cancer risk.         technology was applied to investigate the
  Prostate cancer is a serious health problem and       mechanism. This technology enables the activity
  affects more than 500,000 men per year                of thousands of genes to be monitored at the
  worldwide.                                            same time. It was found that lycopene interfered
                                                        with local androgen activation and that the
• During recent years a group of scientists at DSM      expression of androgen-regulated target genes
  Nutritional Products has undertaken intensive         was reduced. In addition, lycopene decreased the
  research to establish the mechanisms by which         expression of two other factors that are
  lycopene may prevent cardiovascular disease and       considered to be risk factors for prostate cancer.
  prostate cancer.                                      The results showed that the pure lycopene
                                                        molecule targets a key mechanism driving
• Evidence from epidemiological studies and first       prostate cancer development.
  human studies show that higher lycopene levels
  are associated with lower risks for                 • Lycopene has recently been introduced on the
  atherosclerosis, myocardial interaction, stroke       market as an active ingredient in a.o. multi-
  and CVD death. Higher lycopene levels protect         vitamin tablets as well as in pure forms for
  against high LDL-cholesterol levels and DNA           cardiovascular and prostate health.
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• Today customer expectations regarding safety,          can be further categorized as probiotics,
  quality and origin of food are influencing the         prebiotics and direct acting gut microflora
  entire food chain. This includes the animal feed       modulators.
  industry. Consumer protection orientated
  political debates have pushed regulatory             • The gut flora is thought to play a key role in
  authorities to translate these requests into new       general health. Gut bacteria produce desirable as
  legal requirements in order to insure food safety.     well as undesirable metabolites and sometimes
  One particular objective is to substitute the          they themselves may act as pathogens.
  routine use of Macrolite antibiotics as growth         Composition as well as activities of the gut
  promoters. These Macrolite antibiotics are of a        bacteria can be influenced by nutrition.
  different type than the β-Lactam antibiotics           Adding eubiotics to animal feed is a preventive
  produced by DSM Anti-Infectives, which are only        approach to keep the intestinal microflora in
  used for human purposes.                               balance and thereby maintain health and
                                                         performance.
• As a consequence of the forthcoming complete
  ban of the Antibiotic Growth Promoters in the        • Eubiotic products are regulated by the new EU
  EU (January 2006) there is an urgent need for          Directive on Feed Additives, which will facilitate
  alternatives. A main driver for the need for           approval within the EU legal system.
  effective substitutes is to maintain Europe’s
  competitive position in animal production.

• DSM Nutritional Products develops such
  alternative concepts to support health and
  performance of livestock animals under the term
  eubiotics. These alternatives act by a selective
  modulation or stabilization of the gut flora and
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• A healthy gut flora requires a distinct balance          is divided into 97% main flora (to a large extent
  between the main flora consisting of beneficial          anaerobic, Gram positive), less than 3%
  microorganisms, the neutral collateral flora and         collaterial flora and only about 0.01% residual
  the potential harmful residual flora.                    flora.

• Eubiotic concepts support the beneficial               • The cohabit between the host and a well
  microflora and selectively inhibit facultative           balanced gut flora is referred to as eubiosis.
  pathogenic microorganisms of the residual flora.         In contrast to that state a disturbed gut flora is
  With these effects, eubiotics differ from the still      called dysbiosis (Rolle and Meier, 1993).
  available growth promoting antibiotics, which
  due to their broad unspecific mode of action,
  impact on the entire gut flora.

• A gastrointestinal tract is an extensive immune
  organ that integrates complex interactions among
  diet, external pathogens, and local immunologic
  and non-immunologic processes. This organ is
  subject to enormous and continual foreign stimuli
  from food and microbes.

• The host specific flora is acquired during and
  after birth by the first contact with the mother’s
  body flora as well as the immediate environment.
  It consists of a multiplicity of germ species, which
  colonize in both the skin and the mucous
  membranes. The well examined gut for a human
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• To confirm the working hypothesis of targeted
  compounds, a selected gut flora modulator has
  been identified. To this extent DSM Nutritional
  Products has developed in-vitro screening assays
  which aim to project effects in-vivo. These in-
  vitro assays are based on specific bacteria, which
  were isolated from the gut flora of pigs at the
  DSM Research Center for Animal Nutrition.
  It allows the investigation of both the inhibition
  on microbial growth and the potential benefits of
  the eubiotic compound. The assays have been
  validated with an animal model and with growth
  performance trials.

• In 2004, a promising compound has been
  identified following this approach. In-vitro results
  nicely demonstrate the desired effects on
  potentially pathogenic bacteria, while not
  affecting the main flora.

• After confirmation of the assay the target
  compound is now being further evaluated by
  testing the concept in the target animal.
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• VevoVitall®, is a naturally occurring well              • The anti-microbial properties of VevoVitall® are
  established food preservative. It is a special,           shown by the inhibitory effect on pathogenic
  patented ultra-pure grade of benzoic acid, a solid        bacteria like Escherichia coli and other Coliforms.
  non-corrosive acid, which naturally occurs in             At the same time the positive gut bacteria like
  many fruits and berries, like cranberries, prunes,        Lactobacilli are not affected. Growth trials
  cinnamon and ripe cloves. It has long been                significantly demonstrate the improvement of
  generally recognized as safe (GRAS) by the FDA.           weight gain in piglets in a range of 10-20%.
                                                            These effects exceed the performance
• Last year Vevovitall® was launched by DSM as an           improvement usually observed by addition of the
  additive to pig feed. Acting as an acidifier in feed,     common growth promoters like antibiotics, that
  Vevovitall® reduces ammonia emissions in animal           are banned as from 2006.
  excretion by up to 35%. Herewith, the manure
  coming from fattening pig husbandries becomes           • This innovative new product shows a
  more environmentally friendly, saving farmers             tremendous growth potential, as it benefits both
  the costs of air purification systems for their           the environment as well as the economic side of
  stables and dung pits. Due to the unique high             pig husbandry.
  purity of the product it meets the requirements
  of the EU Directive concerning feed additives
  (Group M-70/524/EE).

• Based on internal studies and several
  international growth trials, DSM Nutritional
  Products is now also seeking registration for
  VevoVitall® in piglets as an additive, claiming
  positive effects on growth performance.
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• From all sun light reaching the earth’s surface,     • In addition, scientists have raised concerns about
  only 5% can be classified as UV-radiation.             the estrogenic activity and the lack of
  This small part, however, has a major impact if it     biodegradability of some members of this class of
  hits and penetrates the skin. It can cause             compounds. The mechanism for most present
  irritation, sunburn, premature skin aging and as       UV-filters and its carriers is to have a risk of
  the worst consequence, skin cancer.                    getting absorbed into the skin, including all the
  Dermatologists have warned for more than two           creams’ components.
  decades about the serious connection between
  intensive UV-exposure and the risk of different
  types of skin cancer. Effective skin protection is
  thus essential.

• There are also other unfavorable factors.
  Photoaging, in particular caused by UV-A
  radiation, is gaining attention. UV-A rays set on
  destructive processes in the collagen network in
  our skin, which leads to skin wrinkles and less
  elasticity. This has resulted in a growing demand
  for UV-A filters. Nowadays, nearly every UV-
  protection lotion contains a set of UV-A and UV-B
  filters, products which form the core of DSM
  Nutritional Products’ Personal Care sales
  program.
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• Effective skin protection is essential. The market   • This combination leads to a unique polymeric
  is constantly looking for new and innovative UV-       UV-filter that has excellent cosmetic properties
  light filtering substances which provide effective     and minimizes the risk of skin penetration due to
  protection against UV-radiation, are easy to           its high molecular weight. Additionally PARSOL®
  formulate, have a pleasant conditioning effect         SLX exhibits excellent photostability and is
  and at the same time do not exhibit undesirable        compatible with all available organic and
  transdermal penetration.                               inorganic filters.

• DSM Nutritional Products’ Personal Care R&D          • The unique molecular design of PARSOL® SLX
  Center focuses on two main areas: UV-protection        also opens up a new application area where
  and skin care. Cosmetic formulation, skin              traditional UV-filters are unable to provide good
  biology, skin physiology and chromophore               performance: the prevention of UV-induced hair
  chemistry are the essential competencies used in       damage. In a series of internal and external
  the development of new products.                       efficacy studies it was clearly demonstrated that
                                                         PARSOL® SLX is significantly effective in
• With PARSOL® SLX, DSM Nutritional Products             maintaining optimal combability and preventing
  introduced the first commercial example of a           premature fading of hair color.
  completely new generation of UV-B filters.
  Unlike conventional monomeric filters, this          • The connection with the expertise of DSM
  innovative UV-filter is based on the combination       Performance Materials will add a new dimension
  of a polysiloxane backbone in conjunction with a       to the polymeric UV-filter R&D program of DSM
  classic, highly effective UV-B chromophore (see        Nutritional Products.
  picture).
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• An important part of the R&D within DSM             • An example of tailored product forms is
  Nutritional Products is devoted to the discovery      demonstrated by β-carotene. Based on a variety
  and development of new innovative formulations        of very different product forms, β-carotene can
  of existing basic products. The know-how and          be used as gel-capsules, where a liquid oil
  abilities to create these new formulations are        suspension is needed, as tablets, where elastic
  unique in the industry.                               and stable dry beadlets are necessary to survive
                                                        the harsh tabletting process in fast running
• Most active molecules produced by DSM                 tabletting machines, and as liquid and dry food
  Nutritional Products are very sensitive to light,     forms, where fast dissolving, or non-dissolving -
  temperature and moisture, even in their               water or oil stable- forms are requested.
  crystalline form. They often have limited             Due to their color strength and shade, DSM
  applications in the target industries and             Nutritional Products’ β-carotene forms for
  sometimes show a limited bioavailability.             coloration are benchmarks for the beverage
  These active components therefore need to be          industry. Beside the forms for the human
  protected and tailored to the target industry         nutrition and health segment, a number of stable
  segment. DSM Nutritional Products has                 and bioavailable carotenoid forms for the use in
  developed a broad range of formulation                animal health and nutrition are also produced.
  techniques to overcome the hurdles of instability
  of the active compounds.                            • DSM Nutritional Products has a strong track
                                                        record in launching new product forms.
• Product forms and applications are a very useful      By continuously renewing the product forms
  tool for differentiating and renewing existing        portfolio, DSM Nutritional Products reacts fast to
  products. Due to the formulation expertise, DSM       changing market trends and customer needs.
  Nutritional Products is able to open up new           This presents the profitability of our existing
  markets through new product forms.                    products.
  Furthermore, the highly developed and broad
  formulation capabilities create strong entrance
  barriers.
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• Another part of R&D within DSM Nutritional             Nutritional Products and later independently by
  Products is devoted to the development of new          Chinese companies. Today many Chinese
  processes for our existing products. Recently, a       companies are using this process for Vitamin C
  breakthrough technology for the future                 manufacturing. The advantage over the
  manufacturing of Vitamin C was discovered.             conventional Reichstein process is that it reduces
                                                         the number of steps to two fermentation steps
• Currently DSM Nutritional Products is using a          and three chemical steps to manufacture Vitamin
  technology based on the so-called Reichstein           C, resulting in a reduction of the overall number
  process. This synthesis route combines one             of process steps from seven to five. At the same
  fermentation step with six chemical steps for the      time, however, DSM Nutritional Products has
  manufacturing of Vitamin C.                            substantially improved its chemical process,
                                                         resulting in large cost reductions.
• As stated earlier DSM Nutritional Products’ R&D
  is focused on applying and using nature to           • Recent progress in DSM Nutritional Products’
  produce natural products. Biotechnology is a           biotechnological research has led to the discovery
  powerful tool to produce compounds with the            of a process that in the future will consist of only
  use of molecules from nature like enzymes,             one fermentation step. With just one step this
  bacteria and microorganisms.                           direct fermentation approach is a real
  Recently, DSM Nutritional Products found that          breakthrough technology. If successfully
  biotechnology has the potential to shorten the         implemented it will revolutionize the state-of-the-
  Vitamin C process chain by extending the               art Vitamin C manufacturing.
  transformations that are performed by
  microorganisms and thereby replacing chemical
  steps. The first achievement to this extent is the
  so-called Keto-Gulonic Acid (KGA) process,
  which was initially discovered by DSM
                                                        4c.25




• After the successful lab scale fermentation the
  first assessment of scale-up shows that the direct
  fermentation approach will most likely lead to a
  significantly simplified production set-up.
  A comparison of the equipment needed for the
  KGA-fermentation processes of the Chinese
  producers and the equipment that a direct
  fermentation approach would need, shows the
  important potential of this breakthrough
  technology. This can lead to a full cost leadership
  in Vitamin C manufacturing.

• An extensive patent application portfolio
  covering all aspects of the Vitamin C
  fermentation technology, like the two-step
  fermentation process using batch, fed-batch and
  continuous technology, the use of novel
  enzymes, the use of novel genes, novel genetic
  tools, the product isolation, etc. has been filed.

• Currently, DSM Nutritional Products is working
  on the further development of the direct
  fermentation route and its production set-up.
                                                                                                      4c.26




• DSM Nutritional Products’ innovation                    for new ingredients, including nutraceuticals.
  capabilities have led to recent successes and
  indicate a large potential for further sales growth   • Due to the combination of fast moving
  in the coming years.                                    developments in both science and consumer
                                                          needs the field of human and animal nutrition as
• New innovations are strongly driven by customer         well as cosmetics is one of the most interesting
  needs. Recent market trends will further enhance        fields in the chemical industry in the next
  the use of nutritional ingredients and expand the       decade. The mid- and long term prospects of the
  market in this field. The major trends in the           nutritional ingredients business look very
  Human Nutrition & Health markets as well as in          promising. The current innovation headroom
  Animal Nutrition & Health and Pharma &                  amounts to over € 10 billion.
  Personal Care are the key driver for the
  development of new products and concepts.             • DSM Nutritional Products’ new product pipeline
  Due to the increasing health awareness, the             is very well filled with short-term and long-term
  changing of peoples lifestyles, the aging               efforts fully balanced. The attrition of older
  population, and trends in modern farming of             products will be more than compensated with
  cattle, poultry and fish there is a strong demand       products that were recently introduced and that
  for health enhancing ingredients.                       will be introduced in the years to come.
                                                          DSM Nutritional Products’ current sales from
• At the same time new scientific concepts for the        new products amounts to approx. € 200 mln, not
  prevention of widespread diseases result in an          including sales from new formulations.
  increase of health ingredients. Recent scientific       As the global leader in key technologies and the
  research has identified more and more links             access to all major customers, DSM Nutritional
  between food, genetics and health. A growing            Products is perfectly placed to get the maximum
  body of scientific evidence shows that active           out of the developments this market is going to
  ingredients can help to reduce risks of diseases.       offer.
  These trends considerably increase the demand
                                                                                                     4c.27




• This slide gives an overview of the new products        amount of raw feed volume needed, as well as
  and new formulations in DSM Nutritional                 the amount of manure produced by the animals.
  Products’ pipeline.                                     Also in Animal Nutrition and Health the product
                                                          portfolio will be complemented with improved
• Innovation of ingredients for the Human                 product forms of the existing portfolio.
  Nutrition and Health market focuses notably on
  ingredients that enhance the functionalities of       • For the Personal Care market the main focus is
  food additives. DSM Nutritional Products has            on UV-filters for hair and skin protection.
  been able to launch at least one new product per        The development of new generations of
  year and the pipeline for the future is very solid.     UV-filters, like PARSOL® SLX, will add to the new
  The key drivers for the development are the most        product portfolio.
  important health categories like cardiovascular,
  diabetes type II, inflammation and bone health.
  The new product portfolio will be complemented
  with improved product forms of the existing
  portfolio (like vitamins, carotenoids and
  enzymes). In addition, new applications for
  existing products will be exploited.

• The future Animal Nutrition and Health pipeline
  will be mainly focusing on products to effectively
  replace antibiotics growth promoters (eubiotics)
  and to address environmental concerns (e.g.
  through the use of acids or enzymes). Addition of
  eubiotics and enzymes enhance the efficiency of
  the feed conversion process, thus reducing the
                                                       4c.28




• DSM Nutritional Products’ target innovation
  areas are defined as solutions to the needs of the
  market, provided by DSM Nutritional Products’
  technology base.

• DSM Nutritional Products innovation process can
  build upon the various technology platforms, its
  expertise and competences in the different
  market segments. This differentiates DSM
  Nutritional Products from its competitors, it
  generates patented opportunities, and most
  importantly it allows us to meet the needs of our
  customers.

• DSM Nutritional Products is capable to find
  tailor-made solutions for each application to meet
  the specific needs in the market.
  DSM Nutritional Products’ competences in
  Research and Development are key for delivering
  these new products, new formulations and new
  applications.

								
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