NEWS
NON-CROP IN THE NEWS
Patent-expired molecules and the non-crop market
COMPANIES ■ DuPont’s crop protection sales grew
I am sure that everyone in the crop protection by more than 10% in the second quarter
industry understands what patented and patent- ■ United Phosphorus is continuing its of 2007. The revenue gains were driven
expired means. Increasingly though, it is getting acquisition strategy with the purchase by higher volumes of herbicides for
harder to determine which of the molecules that
of the Argentine agrochemical company, maize and small-grain cereals, along
remain in the market after their patent has expired should be classified as
ICONA, for US$10 million in cash. ICONA with strong insecticide and fungicide
“generic”. Many major agrochemical companies try to prevent their patent-
had consolidated sales of US$13 million businesses. Second-quarter sales
expired molecules from sliding into the “generic” category by employing novel
in the year to September 30th 2006 of DuPont’s agriculture and nutrition
formulations and mixtures, brand values and market repositioning.
and has more than 35 registrations in business rose by 7.2% to US$2,074
Argentina, United Phosphorus says. million, with agrochemicals accounting
Many of these patent-expired molecules can also find themselves in the hands of
new owners as product ranges are rationalised. In new hands, they often receive
for around 36%.
increased attention that allows their incremental value to be truly realised. Most
■ Mitsui Chemicals is to integrate its
of the larger-volume molecules end up finding a new life at a different price-level
crop protection business with Sankyo ■ Indian company EID Parry recorded
through the ever-changing world of the Asian suppliers, at which point they can
Agro on October 1st 2007, following its sales of Rs 262.7 million (US$6 million)
truly be termed “generic”.
acquisition of the company in April. The for its biopesticides division in the
new operation will adopt the Sankyo Agro year to March 31st 2007, up by 2.4%
So what happens in non-crop markets and is it any different to crop protection?
name, and have around 550 employees on the previous year. The company
First of all, it is usually only the larger value molecules such as cypermethrin,
and consolidated sales of some ¥39,000 highlighted a 13% rise in exports to some
fipronil or chlorpyriphos that have found their way into non-crop markets.
million (US$333 million). Rs180 million, with the US and Europe
Many smaller worthwhile molecules have never reached these markets, partly
continuing to be major markets.
because the value and growth potential of non-crop markets has remained a
■ After more than a year of “illegal
well kept secret.
occupation” by members of the Brazilian ■ A series of product and company
Second, the major non-crop markets such as turf & ornamentals and pest
pressure group, the Via Campesina, acquisitions resulted in United
management have always been able to sustain products that are differentiated
Syngenta reclaimed its research facility Phosphorus making a rapid ascent
in terms of formulations and brand names. This has ensured a strong and
in Paraná, Brazil, in July. “The move up Agrow’s dollar-based ranking of
defensible position for the major companies, who rightly take advantage of this
follows recent court decisions in favour of the leading agrochemical companies
position to develop and sustain these markets.
Syngenta,” said the company. in 2006, rising from 18th to 13th
place. Bayer CropScience retained its
Finally, timing is all-important. For example, just as the patents for chlorpyriphos
■ Syngenta’s agrochemical sales grew dominant position despite a 3.8% drop
and the synthetic pyrethroids expired in the single largest non-crop market – the
by 10.5% to US$2,259 million in the in agrochemical sales, while Syngenta
US termite market – the technology of the market changed. The arrival of termite
second quarter of 2007 and were up by edged closer to its rival with a slight rise
baiting systems, followed by the change in soil-applied practice to open up
9.9% to US$4,303 million in the first half. in revenues.
markets for imidacloprid and fipronil, significantly lowered the potential for the
First-half earnings before interest, taxes,
patent-expired molecules. At the same time, the arrival of the Biocidal Products
depreciation and amortisation (EBITDA) ■ Dow AgroSciences has acquired the
Directive in Europe created a further barrier, with the requirement to upgrade
for the crop protection business were Brazilian maize seed company, Agromen
packages significantly deterring new entrants. This has significantly reduced the
up by 13.6% to US$1,500 million due to Tecnologia, which has an 11% share of
range of molecules available.
volume growth and cost savings. the Brazilian maize seed market, for an
What of the future? Over the past few years, many companies involved in
undisclosed amount. The deal includes
the production and supply of patent-expired molecules have extended their ■ Bayer CropScience has won a legal the Agromen brand, “some of its five”
marketing reach and are working to understand non-crop markets better. This is case against the UK agrochemical national production plants, and its two
at a time when the patents on some of the major non-crop active ingredients are supplies company, Ki-Hara Chemicals, research and development units.
expiring. In addition, many specialist distributors, both national and international,
for infringement of patent rights to its
continue to seek to differentiate themselves from their competition by building
insecticide, imidacloprid. The UK company ■ DuPont has reached a settlement
their own range of brands.
had sold imidacloprid that was produced in a patent infringement case against
in China to customers in the Middle East the Chinese company, Jiangsu
The industry should encourage major brand owners to continue to develop
and Europe, but primarily in Almeria, Trustchem Chemicals, over the
innovative formulation technologies to extend the life of their brands. Companies
Spain, Bayer says. Ki-Hara was ordered to herbicide, rimsulfuron. Under the terms
that have acquired patent-expired molecules from the original patent holders
should look into their broader portfolios to see if there are undiscovered
pay Bayer £225,000 (US$462,000). of the settlement, Trustchem will pay
incremental markets for some of these molecules. I can assure them that both
undisclosed compensation and make
actions will be welcomed by the non-crop market and its players.
■ The Italian agrochemical company, a public apology to DuPont for losses
Isagro, has sold its remaining 10% stake resulting from its actions.
Rob Fryatt 
in the non-crop weed control company,
rob@xenexassociates.com 
Isam. “Following the sale, Isagro leaves, ■ Stronger demand for fungicides
www.xenexassociates.com
definitively, the non-crop sector,” it said. and insecticides increased BASF’s
 October 2007  •  www.agrow.com
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