Novozymes has been active in the Indian enzyme market since 1987, and in March announced the establishing R&D facilities in Bangalore, a regional biotechnology growth centre.
CEO Steen Riisgaard said the acquisition, for a total consideration in Indian rupees equivalent to US$115m (€83.4m), is an important step for the company in strengthening its position in India, a market it believes has good growth potential.
Industry insiders have estimated the Indian enzyme market to be worth around INR2.5bn (€4.5m), against a global backdrop of €3.3bn.
According to Novozymes, use of enzymes is still in its infancy in India, but awareness of their potential and benefits n food and beverage formulation is growing.
"The activities of Biocon have a good strategic fit to our existing enzyme business," said Riisgaard. "We see several interesting market opportunities combined with synergy potential, making this a very interesting acquisition."
Burcon's enzyme activities are made up of industrial enzymes, food additives and processing aids.
In particular, Biocon has a leading position in the world market for enzymes aimed at the wine and juice industries with its pectinase product line, which will bolster Novozyme's own offering in this area.
The two companies also have a strategic fit in terms of their product range and the geographical reach of their operations. While Biocon primarily serves the Indian market, it does also export overseas, and Novozyme's sales channels will no doubt open up previously under exploited markets, and consolidation will be afforded in supply chain operations.
Biocon's application development and formulation capabilities will contribute to Novozyme's R&D strategy, not least because it will bring local knowledge to the table.
Biocon also brings expertise in solid state fermentation technology.
Novozymes' new R&D unit in Bangalore will initially focus on optimising enzyme properties. According to Torben Vedel Borchert, director of protein optimisation in Novozymes and responsible for the new department, the reasons for establishing R&D in India include the workforce and the academic environment.
"There are a large number of skilled scientists speaking perfect English. In the long term we also envisage the new unit as a natural bridge to Indian academic institutions and local biotech-companies specialised in protein optimisation and bioinformatics," he said earlier this year.
For its part, the divestment of its enzymes business leaves Biocon free to focus on its biopharmaceutical activities.
In financial year 2006-7, Biocon's enzyme sales amounted to INR 1bn (€18m) - 12 per cent of the company's overall revenue.
Other major players in the Indian enzyme industry include Adnvanced Enzyme, which recently announced that it is setting up a new manufacturing plant in Indore for pharma and non-pharma enzymes.