All signs point to
growth
White biotechnology ushers in major changes in the Chemical Process Industry

White biotechnology is en vogue. The opportunities offered by natural
synthesis are particularly attractive for the production of special chemicals. The industry is making increasing use of fermenting steps and renewable resources. This article takes a look at the latest research and developments in the industry.
Klaus Jopp
There are good reasons why the Chemical Process Industry (CPI) is making the transition from oil to renewable raw materials. Due to the increase in the average price of oil, many alternative methods which used to be too expensive are now cost competitive. According to estimates published by McKinsey, the annual value-add contribution of white biotechnology to the economy is now between eleven and twenty-two billion euros. Cost savings on raw materials, production processes and investments account for about half of that amount. The other half is generated by new products and additional value-add steps.

At the Asia Biotech Forum 2005 in Kuala Lumpur (Malaysia), basic petrochemical compounds such as ethylene, propylene, isopropanol and caprolactam were compared with renewable newcomers like cellulose, sugar, bioethanol and glutamic acid. The results surprised a lot of people. Annual production and prices per ton were comparable. 85 million tons of ethylene, which is the most important monomer in the plastic industry, are produced annually at a price of 400 euros per ton. Four times that amount of cellulose, the most important natural product, is sold at 500 euros per ton. The production volume of caprolactam, an important precursor for the engineering plastic polyamide 6, is now around three million tons a year at 2,000 euros per ton. Customers pay the same price for glutamic acid, which is made from renewable resources and is used at a flavor enhancer. The majority of raw materials for the chemical industry still come from fossil resources. However, the number of products made using renewable resources is often underestimated. There are a lot of them on the market, and the number continues to increase.

The search for alternatives

Manfred Kircher, who works in the Business Ventures Unit at Creavis Technologies & Innovation, explained that “up until this point, biotechnology has only been used if there was no chemical option. There was, for example, no cost-effective alternative for functional proteins (enzymes and enantio-pure amino acids). However, that situation is changing dramatically. Chemical and bio-conversion are now on a more equal footing.” Degussa has concentrated the development of new strategic business in its Creavis subsidiary. The industry believes that bioethanol has significant potential as a replacement for gasoline and as a raw material for the chemical industry. Brazil has shown how to produce bioethanol at competitive prices. The total production costs are $200 – $250 per m³ of ethanol. At an exchange rate of 1.23, this equates to 163 – 203 euros per m³. Production is twice as expensive in Europe. Sufficient quantities of bioalcohol, an environmentally friendly source of energy, could be made available at acceptable prices.

Expansion of the raw material base could also drive down prices, and Prof. Eckhard Boles and his team at the Institute for Molecular Science at the University of Frankfurt are working on this. By implanting new genetic material, the team has succeeded in causing the yeast Saccharomyces cerevisiae to ferment biomass which has remained unused up until how. “Our yeast can be used to process straw, wood and residual plant material. In the past, expensive agricultural products like corn, sugar beets and cane sugar accounted for about 50 – 60 percent of the cost,” said Boles. Conventional yeast only converts hexoses (sugar with six carbon atoms). The new yeast contains additional enzymes which are able to “crack” pentose sugars which only have five carbon atoms.

No lack of interest

Sausage casings, edible dishware, plastic bags and interior trims in cars are already made from renewable resources. Starch, sugar, cellulose and vegetable oil now often complete with traditional plastics, most of which were developed between 1920 and 1960. “Many experts expect to see a similar pattern with renewable resources and white biotechnology as more attention is focused on new molecules,” commented Kircher. Itaconic acid is one candidate. It is produced through bioconversion using fungi, and it is used in the production of paint, varnish and thickeners for cosmetics and pharmaceuticals, and it is also used as a herbicide and a biodegradable polymer. The compact molecule could be used to synthesize a range of totally different chain and ring compounds, which could open the door to a variety of reaction paths.

Degussa has been using biotechnology for years, for example in the production of amino acids as an animal feed additive or in pharmaceutical production. “The question in the CPI is when rather than whether companies are going to invest in biotechnology,” claimed Thomas Haas, Research Manager at the new Degussa Science-to-Business Center Bio in Marl/Germany.
60 of the company’s scientists work with partners from the academic community and industry in state-of-the-art labs and test centers on the development of new biotechnology products and processes which are based on renewable resources. The strategy is to consolidate all of the R&D activities along the entire value-add chain under one roof, from basic research and product development right through to successful market introduction. One of the first things that the team started working on was the development of new drug delivery systems to effectively transport active ingredients, new materials with added functions and substances used in cosmetics. There are currently 1,400 companies around the world which use biotechnology. The split is 72 percent red biotechnology, 24 green biotechnology and only four percent white biotechnology. The distribution of investment is similar. The lion’s share goes into pharmaceutical production, seven percent to plant biotechnology and three percent to chemical applications. The current status quo is expected to shift in favor of white biotechnology. The Industrial Biotech Index shows that white is definitely catching up with red. At any rate, venture capital investment is already on the increase.
According to summary information published by Steven Burill, the leading biotechnology expert in the U.S., investment has increased to $3.7 billion in 2004 compared to $2.8 billion in the previous year in the U. S. alone.

This is for example where Europe lags behind. Kircher is convinced that the establishment of new companies which have good ideas as well as the opportunity to make money is absolutely crucial. He believes that large companies need to create this type of environment as well. That is why it is so important that the Degussa Science-to-Business Center Bio goes off in a new direction for exactly this purpose. It provides the only opportunity for the German chemical industry to maintain its excellent position in the market and if it is used properly, white biotechnology will make a crucial contribution.n