Business/Trade Article
Corporate Report Wisconsin magazine, July 2004 issue, published by Trails Media Group
Seeds of Innovation
Wisconsin's biotech industry augments the revolution in crop science and production
Soybeans resistant to herbicides. Corn that kills attacking insects. Potatoes with fewer calories.
At one time this was the stuff of dreams, but not any longer. Genetically engineered crops produced by biotechnology are changing agriculture in Wisconsin and throughout the world.
"In 2002 there was a $498 million impact associated with biotech crops in the state," says Amy Winters, an industry lobbyist and president of Capitol Strategies LLC. "Currently Wisconsin has more than 50 bioscience companies devoted to agriculture that are providing jobs for more than 20,000 workers — the impact is significant."
One of Wisconsin's leading sites for biotech research is located at Monsanto Co.'s Agracetus campus in Middleton.
Agracetus operates a research and development facility specializing in crop plant transformation and molecular biology. The facility's brightly lit greenhouses are a familiar sight along Highway 14. The main activity at Agracetus is soybean research, and the company also has ongoing efforts in corn and cotton transformation. Currently the facility is focusing on four strategic areas:
* Improving crop traits to achieve higher yields
* Increased pest resistance
* Better food quailty
* Enhanced animal feed
According to Ben Kampelman, a public affairs specialist at Monsanto, one of the key tools in biotech advances at Agracetus is gene-insertion technology. Researchers use "gene gun" technology to insert genes into cells in developing plant varieties that hold promise for attaining higher crop yields and greater resistance to bugs and drought.
Other promising developments at Agracetus include the testing of an oil seed crop enriched with omega-3 fatty acid, which has potential for reducing heart disease. "We're also developing soybean plants that would have substantially higher tolerance for drought and that would have higher yields as a result of improved photosynthesis," Kampelman says.
Nutra-Park Inc. is another example of a company doing imaginative breakthrough work in biotechnology impacting agriculture. The Middleton-based company was born when its founder, Dr. Jiwan Palta, discovered how a naturally occurring molecule known as phospholipid (LPE) could be used to get fruits, vegetables and cut flowers to stay fresher and last longer.
The initial product launch in the United States was in 2002, says Larry Kline, Nutra-Park's chief financial officer and vice president of business development. The company is currently selling products in Chile, and testing them in Spain and South Africa.
"In addition, we have begun to work with retail grocer chains to bring our technology downstream and improve fruit quality for the consumer," Kline says.
While biotech progress in Wisconsin agriculture has resulted in a number of actual and promising commercial applications, progress in the consumer food market has largely met with resistance. Public fears about biotech food continue to be a critical roadblock.
Besides corn and soybeans there are other crops with biotech potential, according to Tom Zinnen, biotechnology policy and outreach specialist with the UW-Madison Biotechnology Center. But many of these are on hold because of concerns with cost and public reaction.
For example, researchers have succeeded in creating biotech potatoes that are low in calories and blight free, but as of yet these varieties have not won acceptance from either the public or food processors.
One of the barriers to developing biotech crops for consumer foods is the extreme caution that large corporations, such as fast food chains, exhibit concerning their brands.
"These companies have a tremendous investment in their brand names and are extremely sensitive about public perception and any threat of a boycott," Zinnen says.
As a result, he says these companies, with their size and financial clout, will actually pay extra to make sure they get non-genetically altered crops, which in turn influences what individual producers decide to grow.
Mainly because of public concerns, Zinnen says biotech crops are held to a higher standard than conventional crops. This situation has resulted in what he calls "reassurance regulations," which are created to make people feel better about a problem or issue. These regulations have succeeded in increasing costs for biotech crop development and creating barriers for companies that would like to enter the market.
David Crass, an attorney who specializes in agribusiness and the environment at the Madison office of Michael Best & Friedrich, agrees that public reaction is extremely important to biotech companies — much more so than the threat of any lawsuit claiming adverse health effects from biotech crops.
"The science is not yet there to support these kinds of lawsuits," Crass says. "However, I do feel that biotech companies would be very concerned about the negative publicity created by a frivolous lawsuit."
While winning public approval of biotech foods continues to be a supremely difficult task, it is just one of several hurdles that biotech companies encounter in bringing new products to market.
Zinnen says that any developer of a new biotech food faces at least three key challenges in introducing a product to the market.
"Companies have to be able to patent their products, manage the extraordinary review process which includes the regulatory gauntlet, and effectively handle public concerns about the safety of their products," he says.
Concerning product safety, Kampelman says new biotech crops and applications at Monsanto go through a rigorous, exhaustive testing process that can take anywhere from three to six years — and this is before the government conducts its own testing and reviews.
"Safety is our top concern," Kampelman says. "We test for everything from food quality to allergy potential to the impact on non-targeted insects. When you look at the entire process, from discovery to full commercialization, it can easily take up to 15 years to bring a product to market."
Despite public concerns over biotech food, there are indications that acceptance is increasing among consumers.
According to a 2003 survey commissioned by the International Food Information Council (IFIC), an increasing number of Americans support food biotechnology. IFIC's survey shows that 62% of Americans believe biotechnology will benefit them or their families in the next five years.
Worldwide, Kampelman says he is encouraged by the continuing acceptance of biotech crops, citing recent government approvals secured by Monsanto to market insect-resistant biotech crops in India and the Philippines.
With its thriving base of biotech companies, strong state support and the availability of critical expertise in such areas as research and licensing, Wisconsin is poised to continue its success in biotechnology. However, one key area it will have to improve in is attracting venture capital.
Teresa Welch, a partner in the intellectual property group at the Madison office of Michael Best & Friedrich, says the state is making progress in this area. "Our numbers of angel investors and overall venture capital activity does not compare to the West Coast, but there are nevertheless a lot of things in place to help advance biotech development in this state."
Welch believes that what would help improve perceptions of Wisconsin's biotech industry is if its leaders, including its scientists and technical specialists, took a more forceful role in the current public dialogue.
"The agricultural industry has had its share of communication problems," says Welch. "Biotech leaders and scientists need to get involved in the debate to help prevent the spread of misinformation."
Already, Wisconsin farmers are growing corn and soybeans that require fewer herbicides, and producing higher yields, with less damage from pests. These are positive messages that can be conveyed to the public.
"When you look at the rate at which the amount of acreage available for farming is decreasing both in Wisconsin and other agricultural states, biotech companies offer the critical advantage of being able to produce more food per acre with less adverse environmental impact," Crass says.
While the verdict is still out on issues such as public acceptance of biotech, what is definitely more clear is that biotechnology is providing a much-needed "shot in the arm" to Wisconsin's economy.
"Biotech is an opportunity for Wisconsin to stop brain drain and to become something more than a commodity state," Crass says. "This is a chance for our state to build a new, robust economic model while maintaining our agricultural heritage."