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7-Business: Can U.S. farmers be saved with GE pharma crops?



                                  PARTáI
-------------------------------- GENET-news -------------------------------

TITLE:  Can Gene-Altered Rice Rescue the Farm Belt?
SOURCE: The New York Times, USA, by Alexei Barrionuevo
        http://www.nytimes.com/2005/08/16/business/16biorice.html
DATE:   16 Aug 2005

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Can Gene-Altered Rice Rescue the Farm Belt?

WATSON, Mo. - Like an expectant father, Jason Garst stood in calf-deep
water and studied the three-foot-high rice plants growing in a flooded
field here.

It was a curious sight in northwest Missouri, where the growing season is
considered to be too short for rice. Mr. Garst, a sixth-generation
farmer, is hoping at least one of the 12 varieties on his test plot will
sprout this fall. If one does, he will start growing rice plants that
have been genetically engineered to produce proteins found in human milk,
saliva and tears. Once converted into a powder form, those proteins would
be used in granola bars and drinks to help infants in developing
countries avoid death from diarrhea.

"I know in my heart that this will be better than anything else we are
doing," said Mr. Garst, 35, who also farms soybeans and potatoes.

The rice project is backed by a private company called Ventria Bioscience
but also has the support of the state and a local university, which are
hoping to reverse the long decline in the area's farm economy. But the
project has run into opposition from environmental groups and even the
beer giant Anheuser-Busch amid fears about the health effects of
genetically engineered crops, making Mr. Garst's little rice paddy a
piece of a larger battlefield.

The economic and academic ambitions of the Missouri project make it
unique, but the arguments echo those heard in similar disputes in Europe
and, increasingly, in the United States. Critics of Ventria's plans are
concerned that the gene-altered rice could contaminate regular rice crops
and pose a health risk to consumers, scaring off buyers. Ventria and its
academic partner in the project, Northwest Missouri State University, say
they can control the potential for contamination. And they say the risks
are minimal when balanced against the potential for the special rice to
help cut the costs of drugs and save lives.

The debate has a certain urgency in the Farm Belt because it highlights
the challenge facing much of the region's economy: finding new products
that will reduce farmers' reliance on commodity crops. As equipment has
become more efficient and foreign competition has stiffened, farms have
consolidated and profit margins have shrunk, forcing farmers to plant
ever more acres to squeeze out a living. The genetic engineering work
that Ventria and other companies are doing can add value to products like
rice, offering farmers a more stable income that does not rely on steep
government subsidies.

"There is no question that this represents a chance to transform the
economy of the region," said Mark Drabenstott, director of the Center for
the Study of Rural America at the Federal Reserve Bank of Kansas City.
"For regions like northwest Missouri, there is not a long list of
economic alternatives."

Despite opposition, Ventria's plans to grow genetically engineered rice -
eventually to commercial scale - are going forward. The company began
growing rice in North Carolina this summer after getting approval from
the Agriculture Department. Once Ventria decides where it will grow rice
in Missouri, it will have to apply for a permit from the department, a
process expected to take two to three months.

Dean L. Hubbard, president of Northwest Missouri State, persuaded Ventria
last year to move its operations from Sacramento to new buildings planned
for the Northwest campus in Maryville, about 90 miles north of Kansas City.

Seeking a way to reverse the area's slide in population, Dr. Hubbard
teamed up with Melvin D. Booth, a Northwest Missouri alumnus who
previously ran two large biotechnology companies. The two approached
Ventria about making it part of the university's plan to form joint
ventures with young biopharmaceutical companies.

Ventria was already considering similar offers from universities in
Georgia, Louisiana and North Carolina, but Scott E. Deeter, Ventria's
chief executive, agreed to visit the university last August. Mr. Deeter
said that on the ride from the Kansas City airport, he was intrigued when
Dr. Hubbard described the university's program to heat and cool the
campus using bio-fuel derived from paper and wood chips.

At the meeting, Mr. Garst presented him with a research paper he had
prepared on what it would take to grow rice in northern Missouri. "It was
very impressive," said Ning Huang, Ventria's vice president for research
and development, who was there.

Finally it came down to whether Ventria scientists would agree to move to
Maryville, population 10,000, from California. Next year 13 will move,
including Dr. Huang.

Under the agreement reached last November, Ventria will pay farmers more
than double what they make on their most profitable crop, and pay
Northwest Missouri $500 an acre for crops grown on university land. The
university is spending about $10 million to help build a production and
teaching complex, and the state is kicking in another $10 million.

Atchison County, Mo., where Mr. Garst's farmland is, has lost more than
1,000 people, or 14 percent of its population, since 1990. The town of
Watson, once a thriving rural hub with three grocery stores and an opera
house, has just over 100 people and no place to buy a soda. Most
buildings have been boarded up.

"To reverse the population slide, you have to make it profitable to
farm," Dr. Hubbard said. "My dream is that 10 years from now, this rural
economy has been transformed, that it is vibrant again and people are
renovating their downtowns."

The fate of Mr. Garst's experimental rice plot has loomed larger since
Ventria encountered resistance to planting its rice in the southern part
of the state, where rice has traditionally been grown.

When the company was considering Missouri as a place to grow its rice, it
talked to Anheuser-Busch, which uses Missouri rice in its beer. Mr.
Deeter said Anheuser-Busch initially did not raise any opposition to the
project. But when Ventria tried to plant rice in southern Missouri this
spring, the beer maker threatened not to buy any rice grown in the state.
The company feared a consumer backlash if people thought gene-altered
rice could end up in their bottles of Bud.

For Missouri's farm economy, the risk of growing pharmaceutical rice is
high. More than half of Missouri's rice is sent abroad, to the European
Union and Caribbean countries that are especially sensitive about
genetically modified products.

"We are still having to make statements to our customers that the rice we
export is not genetically modified," said Carl Brothers, the vice
president for marketing at Riceland Foods, which markets more than half
of Missouri's rice. "We are concerned longer term that if Ventria and
others get involved that will get harder to say."

The two companies reached a truce in April: Ventria agreed not to grow
genetically modified rice within 120 miles of commercial rice crops. "We
can continue to purchase rice grown and processed in Missouri as long as
Ventria's growing areas remain sufficiently far from commercial rice
production," said Francine Katz, a spokeswoman for Anheuser-Busch.

That deal suddenly made four test plots in the northern part of the
state, including Mr. Garst's, all the more important, since Ventria's
agreement with Northwest Missouri State calls for the company to grow 70
percent of its rice in the state.

To prove to its customers that it would have a diverse supply base,
Ventria must grow in at least one other location in North America, and is
also searching for a growing area in the Southern Hemisphere to be able
to produce year-round. In June, Ventria planted 70 acres of genetically
modified rice in North Carolina. There, environmentalists continue to
attack the company, saying the rice poses a threat to other crops and the
human food chain.

Ventria's rice fields are just a few miles from a rice-seed-screening
research center and are also close to two wildlife refuges with large
populations of migrant birds and swans that environmentalists contend
could transport Ventria's rice seeds into wild areas. Storms and floods,
environmentalists say, could also lead to rice contamination.

"Just washing away in a big rain- storm is enough," said Margaret Mellon,
director of the food and environment program at the Union of Concerned
Scientists in Washington. Scientists at Ventria, which is yet to make any
money from its bio-rice, say rice is among the safest crops for genetic
engineering. Rice stalks pollinate themselves, so the altered genes,
which are synthetic versions of human genes, cannot be easily transferred
to plants in other fields. And Ventria requires farmers to employ a
"closed system," using dedicated equipment and a production process where
the seed is ground into a powder before it leaves the farm.

But critics say that there is no way to guarantee that the farmers will
follow all the government regulations and Ventria's rules, and that they
are worried about the risk of contamination because it would be hard to
detect. "We simply wouldn't know if a contamination event took place,"
said Craig Culp, a spokesman for the Center for Food Safety, in Washington.

Dr. Hubbard acknowledged that there are risks, but he said he believed
that they were minimal.

Federal regulations have been tested before, most notably in 2002, when
drug-producing corn made by ProdiGene began sprouting in soybean fields
near its Iowa and Nebraska sites. The Agriculture Department seized
500,000 bushels of soybeans and assessed the company nearly $3 million in
fines and disposal costs. Earlier, in 2000, a gene-altered variety of
corn that was approved for animal feed but not for human consumption was
found in taco shells and other grocery items, prompting recalls.

Mr. Garst is a modern breed of farmer with a master's degree and a
healthy interest in science. And he himself has done whatever he can to
wring more from his commodity crops, even trying out a $300,000 tractor
that steers automatically using a global-positioning satellite to till
straighter rows.

"Obviously, you will not see pharmaceutical crops from here to Kansas
City," he said of Ventria's project. "But there will be pockets in this
area where you will see development. If you keep two more farmers in this
area it is huge - there are four of us now."


                                  PARTáII
-------------------------------- GENET-news -------------------------------

TITLE:  Gov. reveals Life Science plan for Kentucky
SOURCE: The Ledger Independent, USA, by Danetta Barker
        http://www.maysville-online.com/articles/2005/08/15/local_news/
855science.txt
DATE:   15 Aug 2005

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Gov. reveals Life Science plan for Kentucky

A strategic plan calling for Kentucky to become a world leader in the
research, development and marketing of life science and bioscience
innovations that will produce a new economic engine for the state was
unveiled by Governor Ernie Fletcher recently.

The plan, according to Rep. Mike Denham, is another step toward replacing
the tobacco industry for Kentucky.

"Life Sciences is the fastest growing industry in the country," Denham
said, "with $15 billion 10 years ago and $45 billion last year. It is an
important industry to the economy."

Denham said Kentucky's agricultural and medical fields can benefit from
the research of life sciences. From genetically enhanced seeds for food
production to corn based ethanol, research has already brought change to
agriculture in the state. Vaccines and other medical techniques are
another side of life sciences. The most controversial being stem cell
research. Denham said one of the most important aspects of research is to
determine what is or is not allowed.

The 19-member Governor's Life Science Consortium, a group of state
experts from science, business, government and education assembled by
Governor Fletcher last year, details the steps necessary to bring
Kentucky to the forefront of emerging scientific fields in a 20-page
report made available to the public at www.kentucky.gov

"I am delighted and encouraged by the work of these dedicated
individuals," said Fletcher. "Just a year ago, I asked this group to
prepare a plan for the next decade and beyond. I look forward to
reviewing their recommendations and determining how best to proceed."

The four life science and bioscience areas identified in the action plan
are natural products, medical devices, health technology services and
niche pharmaceuticals/niche biotechnology.

The report notes that Kentucky is considered to be an emerging novice
state in the life science area, particularly with respect to the
commercialization of research by the University of Kentucky and the
University of Louisville. Both institutions have made impressive gains in
attracting federal research funding and potential patentable inventions.

In addition, the presence of United Parcel Service (UPS) in Louisville
means that Kentucky does not have to set up or lure a worldwide delivery
company to ship these time-sensitive medical devices around the world quickly.

"The potential growth of these areas is simply staggering," Fletcher
said. "Between 1992 and 2003, the U.S. revenues for the biotechnology
area alone grew from $8 billion to $39 billion, an increase of nearly
five times. With the proper utilization of our existing strengths, we can
significantly improve Kentucky's participation in the life science industry."

The life science industry consists of several different sectors that
include pharmaceutical, nutraceutical, biotechnology, medical devices,
bio and health informatics, as well as services related to these sectors.

"Over time, these mostly unfamiliar life science and biotechnology terms
will become as much a part of our image and vocabulary in Kentucky as
bluegrass, thoroughbreds and basketball," Fletcher said. "We've done it
in the automobile industry, so there's no reason why we can't become
leaders in this field as well."

 Following are four areas outlined by the consortium and a few of the
businesses and universities that are successful in these fields.

-- Natural Products: If a compound or product is produced in nature by a
plant, animal or micro-organism it is considered a natural product.
Existing assets in the state include the Kentucky Tobacco Research and
Development Center in Lexington, Large Scale Biology Corp. in Owensboro,
Alltech in Nicholasville, and Martek in Winchester.

-- Medical Devices: Examples of medical devices can range from simple
catheters to sophisticated electronic devices implanted during surgical
procedures. The consortium identified engineering programs at the
University of Kentucky and the University of Louisville and Jewish
Hospital in Louisville as well as UPS as potential key participants in
this growing sector.

-- Health Technology Services: This area of life sciences includes
bioinformatics, biologistics, diagnostics and other services involving
the application of technology to life sciences. Kentucky's current assets
in this sector include Advanced Imaging Concepts, Humana in Louisville,
and UPS.

-- Niche Pharmaceuticals/Niche Biotechnology: Unlike areas of
biotechnology or pharmaceuticals that require massive corporate
involvement, this sector focuses on narrow, specialty activities, such as
formulation and niche manufacturing. The prestigious School of Pharmacy
at the University of Kentucky, ranked eighth nationally, and companies
such as Xanodyne and Pediamed have considerable involvement in specialty
pharmaceutical activities.

Eleven specific recommendations have been presented to Governor Fletcher
by the consortium. One major recommendation calls for the establishment
of a "seed fund" to target investing in life science start-up companies.

The report indicates that Oklahoma, Arkansas and West Virginia have
created such funds in recent years. Another recommendation calls for a
"Brains for Business" program to unite strengths of business entrepreneur
with innovative researchers to market new products and services.

Members of the consortium included: Dr.Wendy Baldwin, Dr. Keith W. Bird,
James Clifton, Dr. Maelor Davies, Eric Davis, Alex Day, Steve Downey,
State Representative Jim Gooch Jr., Roger D. Griggs, John R. Hall, Dr.
Allyson Hughes Handley, State Senator Ernie Harris, State Representative
Thomas R. Kerr, Bill Lear, Dr. Nancy C. Martin, Billy Joe Miles, Keith
Rogers, Robert S. Saunders and State Senator Johnny Ray Turner.




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