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Public-private partnerships in modern biotechnology

Summary

A number of factors currently discourage biotech R&D in developing countries including high research costs, insufficient regulatory capacity, a lack of scientific resources and skilled personnel, and unfavourable intellectual property arrangements. Innovative, complementary and synergistic public-private sector partnerships are becoming an increasingly important way for developing countries to move a step closer to exploiting the benefits of modern biotechnology.

Introduction

The uptake of genetically modified (GM) crops by farmers in both developed and developing countries has been one of the most spectacular examples of adoption of a new technology in recent global agriculture. In 2001, the area of land planted with GM crops had increased to over 52 million hectares since being introduced commercially in 1996, and accounted for 36 per cent of the global area of soybean, 16 per cent of cotton, 11 per cent of canola and 7 per cent of maize cultivation. [1]

However, while the value of GM crops has been demonstrated to farmers in developed countries [2,3,4], and to a lesser extent in some developing countries [5,6,7], research and development (R&D) has largely focused on introducing crops and traits that are of widescale commercial application in developed countries.

In contrast, research on crops and traits of particular importance to small farmers and poor consumers in developing countries has been relatively neglected. Except for limited work on rice, bananas and cassava, little biotech research currently focuses on helping these communities solve their productivity and nutrition problems [8]. Improving "orphan crops" is particularly important as they have significant impacts on resource-poor farmers in developing countries.

Immediate potential benefits from the use of biotechnology include increased food supply for consumption, increased farm outputs for cash, reduced costs per unit of output, and improved food quality and nutrition. Looking beyond the short-term, benefits could include employment generation for food processing and growth of non-farm local economies — conditions that could help to alleviate poverty, particularly for the rural poor.

Harnessing biotechnology and its applications for the benefit of the poor will require considerable attention in many areas, however, including:

  • allocation of additional public resources to agricultural research;
  • appropriateness of, and access to, biotechnology by resource-poor farmers;
  • improvement in the seed distribution and extension systems;
  • capacity-building of the public sector in biotech R&D;
  • public education;
  • policies and regulatory frameworks on biosafety, food safety and intellectual property rights (IPRs); and
  • stronger public-private sector links for both international and local collaborative undertakings.

This paper will not attempt to discuss each of these in detail. An excellent review by Byerlee and Fischer [9] provides a broad framework for assessing a range of policy and institutional options available to developing countries for generating and accessing the products of modern biotechnology. This paper will focus mainly on the increasing importance of public-private sector partnerships in helping to deliver the benefits of GM crops to developing countries and some of the difficulties experienced in such initiatives.

Constraints in biotech adoption in developing countries

A number of factors currently discourage biotech R&D in developing countries. The development of GM crops and other biotechnology applications is capital-intensive, requiring substantial long-term investment. Research costs are high, especially as the vast majority of new discoveries and cutting-edge products involve technological components that are owned by, and must be licensed from, private companies and a few major public research organisations. With declining financial support from the public sector, international donors, and the private sector, research institutions in developing countries will soon be unable to afford the development costs needed for GM crops.

Other constraints include the low perceived value of the technology by governments in developing countries (with the exception of countries like China, India, Indonesia, and Malaysia); the absence of adequate regulatory capacity (including biosafety and food safety); insufficient IPR management capacity and resources required to effectively utilise such technologically-advanced products; a lack of scientific resources and skilled personnel; and low public acceptance of these technologies [10].

Additionally, in cases involving transfer of technology, it is crucial that both the donor and recipient are aware of IPR issues [11]. In saying that, developing countries often lack adequate IPR management capacity, resources, and experience. Although there is significant pressure to modify the international IPR system and address the dominance of private IPR ownership, developing countries still need to improve awareness and understanding of IPR issues.

Given the constraints mentioned above — and the fact that the private sector is currently the largest investor, major owner of IPRs, and the main disseminator of new agricultural technologies — the need to consider innovative, complementary and synergistic public-private partnerships becomes apparent.

Potential options for partnerships

There are a number of different types of potential alliances for biotechnology research in developing countries, and public sector national agricultural research systems (NARS) have many options to choose from (Figure 1). Private sector involvement can range from local seed companies, to large multinationals, and even specialised biotech companies.

 
Figure 1: Potential Partnerships in Biotech R&D (after Byerlee and Fischer) [9]

In some cases, NARS have entered into joint ventures with small local companies, which have the advantage of an intimate knowledge of local marketing and distribution systems. For example in Kenya, a local private company (Genetic Technologies Ltd.) has assisted the Kenya Agricultural Research Institute and the Jomo Kenyatta University to distribute disease-free tissue cultured bananas to resource-poor farmers.

NARS may also find it useful to partner other local public sector institutions or international agricultural research centres, such as those of the Consultative Group on International Agricultural Research (CGIAR). Another option is collaboration with advanced research institutes and universities in the North, as many of these carry out a considerable amount of research orientated towards developing-country agricultural problems.

A number of different combinations are possible and there is even potential for three- or four- way alliances. It is important, however, that each sector should always seek to capitalise on the comparative advantages of the other, and optimise the use of R&D resources for a broad impact.

Comparative advantages of private and public sectors

Assets of the private sector include large R&D resources to fund long-term and sometimes high return, but speculative, agricultural projects; a diverse range of organisations from small, dedicated biotechnology companies to large multinational companies that have extensive and increasingly collaborative research links with the public sector, particularly universities; a critical mass of scientific research resources; knowledge of, and expertise in, marketing and distribution systems; and access to global markets and the associated advantages of economies of scale. [12]

The public sector, on the other hand, can provide the private sector with intimate knowledge of pathways for local market access, applied breeding skills and infrastructure, understanding of the seed delivery and extension systems, and access to local genetic resources. In addition, partnerships with the public sector are likely to improve the public image of biotechnology and of the private company involved.

Partnerships should not be seen as an effort to transform public sector research institutions into private companies [13]. Rather, the role of the public sector will remain vital, as the private sector is unlikely to deliver biotechnology applications for many crops, to address all biotic and abiotic production constraints, or to realise commercial markets in all developing countries. It falls to the public sector to fill these research gaps. The public sector can also play a key role in encouraging the generation of local private sector initiatives that generate local wealth and which, with suitable guidance, could have a real impact on the resource-poor.

The public sector, both at the national and international level, is also able to bring its resources to bear on strategic R&D efforts where others have no comparative advantage or capacity to invest. Key research agendas include improvement of staple and cash crops, resource conservation and enhancement, and natural resource management. Furthermore, the public sector will continue to provide a critical role in addressing broad policy issues, and guiding programs that optimise public benefits from technological innovations in agriculture.

Governments should not view partnerships with the private sector as detrimental to the 'public good', as these partnerships are often the most effective way to achieve national goals [12]. The collective aim, however, must be to build partnerships that optimise the comparative advantages of the public and private sectors to achieve mutual objectives.

Examples of public-private sector partnerships

Several public-private sector partnerships have already begun to facilitate access to biotechnology and the design of new crop varieties for developing countries. Current approaches to public-private sector partnerships include joint ventures in R&D with equal sharing of costs and returns on investments, information and knowledge sharing, technology transfer, outright donation of technology by private firms to national public research institutes, and institutional capacity building. In the examples below, the private sector has shared one or more of the following:

  • fundamental scientific data;
  • technology, including genes and traits;
  • scientific know-how to adapt proven technology to crops important for to-scale farmers;
  • advice on environmental stewardship and information on food safety; and
  • licenses to patented technologies.

a. Bt insect resistance technology

Parallel projects in Egypt and Indonesia provide good examples of successful public-private collaborations, but also highlight some of the challenges faced by such initiatives.

The Agricultural Genetic Engineering Institute (AGERI) in Egypt, in collaboration with US-based company Pioneer Hi-Bred, have characterised potentially novel strains of Bacillus thuringiensis (Bt) and applied this technology to develop insect-resistant maize. (Bt is a naturally occurring insecticidal toxin, normally produced by a soil-borne bacterium.)

AGERI scientists were trained at Pioneer in methodologies to characterise Bt and maize transformation technologies, while Pioneer was granted access to evaluate certain novel Bt proteins and genes patented by AGERI. The project was supported by the Agricultural Biotechnology Support Program (ABSP) of the US Agency for International Development (USAID). Unusually, ownership of IPRs relating to these Bt strains actually belonged to the public sector partner, and were made available to Pioneer under a contractual agreement. AGERI is pursuing commercialisation in Egypt while Pioneer uses the license in the US [13].

In Indonesia, USAID supported a similar collaboration between ICI Seeds (now Syngenta) and the Central Research Institute for Food Crops (CRIFC) that focused on the development of Asian corn borer resistance in tropical maize. This project included training of CRIFC scientists in the use of proprietary transformation technologies.

These experiences highlight various challenges that face public-private sector partnerships. The most significant constraint relates to IPR, due both to the lack of awareness and management capacity in public institutions, as well as differences in the extent of IPR protection provided by national laws.

Despite capacity-building efforts to address this, the absence of patent protection means that some companies will not transfer certain technologies or applications to public institutions if they compromise commercial interests. For example, the CFIRC / ICI project ran into difficulties at the stage of negotiating technology transfer agreements. Because of a lack of patent protection, an agreement with ICI Seeds for transfer of the Bt genes or maize transformation technology to CRIFC could not be reached.

Different cultural perspectives and institutional approaches have also been identified by USAID as problem areas. For example, public sector research institutions in developing countries are unfamiliar with negotiating with the private sector; conversely, companies are not used to slow bureaucratic processes and government requirements.

b. Papaya Biotechnology Network of Southeast Asia

Another example of a successful partnership is the Papaya Biotechnology Network of Southeast Asia, which consists of national experts from Indonesia, Malaysia, Philippines, Thailand, and Vietnam, and was formally launched in 1998. Its primary mission is to contribute to a better quality of life for rural and urban families in Southeast Asia [14], seeking to enhance income generation, food production, nutrition, and productivity for resource-poor farmers by integrating proven biotechnology applications into their agricultural practices.

The importance of papaya in developing countries is often understated because most papaya production does not enter the trading sector. But in terms of daily consumption it ranks second only to banana in Southeast Asia. Unfortunately, papaya is affected by several diseases and pests, the most widespread of which is papaya ringspot virus (PRSV), which can drastically cut papaya yields and has a devastating effect upon the livelihoods of subsistence farmers. Additionally, there are significant postharvest losses because of inadequate farm-to-market roads and poor storage conditions in tropical countries.

ISAAA developed and brokered the papaya network with support from both the public and private sectors. Monsanto and scientists of the University of Hawaii are now collaborating with the network to develop PRSV-resistant papaya; Thailand has already developed and field-tested several promising strains. Meanwhile, Zeneca Plant Science — now part of Syngenta — and the University of Nottingham are sharing their technology and know-how to develop delayed-ripening papaya; Malaysia is presently conducting its first contained field trial.

The bureaucratic processes and stringent governmental requirements for biotechnology work, especially for field or greenhouse testing, however, have consistently delayed progress within the network. Other problems include a lack of skilled personnel and national capacity, and chronic inadequacy in public sector research funding for developing country partners.

In spite of these difficulties, the network has contributed to increased local capacity in the region and forged useful long-term relationships. As part of the project, scientists from the five countries have been trained in transformation technology, biosafety, food safety, and IPR management. The network also brings various stakeholders from the region together with public and private Northern counterparts to share experiences relevant to the project.

c. Golden Rice Humanitarian Board

Another example that highlights both the potential and hurdles of public-private collaborations is that of Golden Rice. The rice, nutritionally enhanced with beta-carotene (provitamin A), was initially developed by a team led by Swiss scientist, Ingo Potrykus. In 2000, the Golden Rice Humanitarian Board was established to help the inventors deliver the product to developing countries, where Vitamin A deficiency causes five million deaths annually and blindness in a further 500,000 people.

A total of about 70 patents belonging to 32 different companies and universities are embedded in Golden Rice [15]. This clearly presented a major challenge to the inventors who wanted their product to reach farmers free of charge and without restrictions. After lengthy negotiations, agreement was reached with Greenovation and Zeneca (now part of Syngenta), which are currently working with agencies throughout the world to enable delivery of this technology for humanitarian purposes.

Syngenta has agreed to donate certain technologies used in the development of Golden Rice to assist ongoing research, as well as taking steps itself to improve the product further. The company, which owns the commercial rights to Golden Rice, has also allowed the inventors to distribute it on a royalty-free basis to developing country farmers who earn less than $10,000 per year, leaving the company free to explore commercial prospects for the technology [16]. Similarly, Monsanto has announced that it will provide royalty-free licenses for all its technologies used to support the further development of Golden Rice.

After overcoming scientific and IPR problems, a major hurdle remains before this rice will reach subsistence farmers: the trait needs to be transferred to the many locally adapted varieties in rice-growing countries. This step of the project will begin with a careful needs assessment, an analysis of the pros and cons of alternative measures, and setting a framework for the optimal and free use of Golden Rice, which will be followed by environmental, economic, and food safety assessments. The Golden Rice Humanitarian Board will provide advice and support throughout this process.

d. Virus Resistant Sweet Potato in Kenya

Sweet potato is an important secondary food crop for many Kenyans, whose staple diet relies on cereals such as maize, and is also an important food security crop during maize crop failure. It yields higher amounts of food energy and micronutrients per unit area than any other crop. The production of sweet potato is, however, constrained by a number of factors, in particular the disease caused by Sweet potato Feathery Mottle Virus (SPFMV). In combination with other minor viruses SPFMV may cause up to 80 per cent loss of susceptible varieties in many parts of Africa.

In 1991, after reaching the conclusion that a biotechnology approach to virus resistance was the most promising long-term solution for SPFMV, a research partnership was developed and financially brokered by ISAAA. The initial partnership involved the Kenya Agricultural Research Institute (KARI), Monsanto, USAID's ABSP and the Mid-American Consortium. Monsanto donated (through a royalty-free license) virus-resistance technology for application to sweet potato.

Through this partnership, transgenic SPFMV-resistant sweet potato has been developed using materials originating in Kenya. In addition, many Kenyan scientists have been trained both in the US and in Kenya on various aspects of developing GM sweet potato, the establishment of national biosafety structures, preparation and submission of biosafety permit applications, laboratory and field biosafety evaluation of GM crops, and IPR protection and technology transfer mechanisms. As a result, GM sweet potatoes are now being tested on-station in four KARI centers. The collaboration now mainly involves the Vegetable and Ornamental Plants Institute (VOPI) of South Africa, KARI, and Monsanto.

A number of challenges still lie ahead of this project, including the need to strengthen local capacity for transformation techniques and evaluations, and to optimise the transformation into commercial products. A lack of personnel is aggravating the situation; most of the scientists that were trained by the project have either left or simply not returned from their stints abroad, and even those who returned to Kenya have now relocated to do other activities. There also appears to be a lack of motivation and commitment among scientists working on the project due to poor remuneration and overwhelming amounts of responsibility.

e. Rice genome sequencing project

The remit of the International Rice Genome Sequencing Project (IRGSP) — a world-wide consortium of scientists from Japan, the United States, China, Taiwan, Korea, India, Thailand, France, Brazil, and the United Kingdom established in 1998 — is to place a complete, high-quality DNA sequence of the rice genome in the public domain. Both Monsanto and Syngenta have agreed to share their rice genome draft sequence data with the project. Their contributions are expected to accelerate completion of a finished sequence and reduce overall project costs.

Rice is the most important cereal crop for half of the world's population. Increasing population pressure coupled with decreasing arable land, water, and other resources for sustaining agriculture, make it especially important to maximise rice productivity.

It is hoped that once the rice genome map is completed, plant breeders will be able to identify traits for yield, disease resistance, and tolerance to environmental stress. Pinpointing the genes associated with these traits will speed the transfer of beneficial traits into locally adapted elite lines, and will permit plant breeders to search for useful genetic variants that can help produce new crops to solve age-old problems in rice production.

Conclusion

While developing countries stand to benefit most from the products of new agricultural technologies, their adoption and uptake of GM crops has been slow. This is due to several factors including the spiralling costs and proprietary nature of modern biotech R&D, the absence of regulatory and IPR management capacity, and a lack of scientific resources and skilled personnel.

Though partnerships cannot single-handedly address all of these constraints, many believe that they are an integral part of the solution. Partnerships with the private sector are an important route for public research institutes in developing countries to access needed tools and technologies. Not only can these alliances facilitate technology development and transfer, but they can also help build local capacity as illustrated by the examples above.

There are, however, undoubtedly limitations to such initiatives. In some cases, cultural differences between public and private sectors and the lack of IPR and business management skills in public research institutes have resulted in delay or even in failure of such projects. Additionally, partnerships between the public and private sector should not be viewed as the only avenue to access new technologies. They are, however, one way for developing countries to move a step closer to exploiting the benefits of modern biotechnology.

Governments in the South will need to both invest in such approaches, and create an 'enabling environment' that promotes successful outcomes. They should allocate more resources to R&D (including increased local capacity), develop systems for managing risks, safety regulation and IPR management, and encourage the formation of local private initiatives. Governments cannot rely solely on alliances that are based, for example, on free access to proprietary technologies for non-competing markets.

The private sector in the North is unlikely to deliver biotechnology applications for many crops, to address all production constraints, or to realise markets in developing countries. It falls to governments and institutions in the south to fill these research gaps. The solution will depend not on charity, but on strong national and international policies.

Margarita Escaler is at the International Service for the Acquisition of Agri-biotech Applications (ISAAA), a not-for-profit international organisation co-sponsored by public and private sector institutions, which aims to facilitate the acquisition and transfer of agricultural biotechnology applications from the industrial countries for the benefit of developing countries.

References

[1] James, C. (2001) Global review of commercialized transgenic crops, 2001. ISAAA Briefs No. 24. Ithaca, NY.

[2] Canola Council of Canada (2001) An agronomic and economic assessment of transgenic canola. Canola Council of Canada 1-95.

[3] Carpenter, J.E. and Gianeesi, L.P. (2001) Agricultural biotechnology: updated benefit estimates. National Center for Food and Agricultural Policy, Washington DC.

[4] Gianessi, L.P. et al (2002) Plant biotechnology: current and potential impact for improving pest management in US agriculture - an analysis of 40 case studies. National Center for Food and Agricultural Policy, Washington DC.

[5] Pray, C.E. et al (2001) Impact of Bt cotton in China. World Development, 29(5):813-825.

[6] Traxler, G. et al (2001) Transgenic cotton in Mexico: economic and environmental impacts. 5th International Conference on Biotechnology, Science and Modern Agriculture, Ravello, Italy.

[7] Ismael, Y. et al (2001) Efficiency effects of Bt cotton adoption by smallholders in Makhathini Flats, KwaZulu-natal, South Africa. Paper for the 5th International Conference on Biotechnology, Science and Modern Agriculture, Ravello, Italy.

[8] Pinstrup- Andersen, P. and Pandya-Lorch, R. eds. (2001) The unfinished agenda: Perspectives on overcoming hunger, poverty, and environmental degradation. International Food Policy Research Institute, Washington DC.

[9] Byerlee, D. and Fischer, K. (2000) Accessing modern science: Policy and institutional options for agricultural biotechnology in developing countries. Agricultural Knowledge and Information Systems Discussion Paper No.22307. The World Bank Group.

[10] Krattiger, A.F. (2002) Public-private Partnerships for efficient proprietary biotech management and transfer, and increased private sector investments. IP Strategy Today No. 4.

[11] James, C. (1997) Progressing public-private sector partnerships in international agricultural research and development. ISAAA Briefs No. 4. Ithaca, NY.

[12] Kowalski, S.P. et al (2002) Transgenic crops, biotechnology and ownership rights: What scientists need to know? Plant Journal 31:407-422.

[13] Lewis, J. (1999) Leveraging partnerships between the public and private sector - experience of USAID's Agricultural Biotechnology Program. Agricultural Biotechnology for the Poor. Proceedings from an international conference. CGIAR.

[14] Hautea, R. et al (1999) The Papaya Biotechnology Network of Southeast Asia: Biosafety considerations and papaya background information. ISAAA Briefs No.11. Ithaca, NY.

[15] Kryder, R.D. et al (2000) The intellectual and technical property components of pro-vitamin A rice (GoldenRiceTM): A preliminary freedom-to-operate review. ISAAA Briefs No. 20. Ithaca, NY.

[16] Potrykus, I. (2001) Golden Rice and beyond. Plant Physiology 125:1157-1161.