Industrial Biotech Innovation Report

Signals Magazine's feature article for February, entitled "Designer Organisms," is focused on synthetic biology, which is described as "a new discipline that brings together engineering, biology, chemistry, and information technology to take genetics and genomics to the next level." The goal of synthetic biology is "to replace random events with predictable ones - by creating a catalog of parts (genes, operons, chromosomes, for instance) that can be used in protein production, metabolic engineering, even envrionmentally friendly fuel production...it's building organisms for specific purposes, rather than modifying existing ones to fit the need." The report focuses on three synthetic biology start-ups receiving venture capital funding in 2005:

Synthetic Genomics Inc., whose founders are J. Craig Venter and nobel laureate Hamilton Smith, received $30 million from VC Draper Fisher Jurvetson and two other unnamed investors. The company's goal is to create new bacteria for ethanol or hydrogen as alternative fuel sources by creating microbes with new metabollic pathways. Researchers are looking at devising new systems with specific functions that can be used as "parts" and inserted into cells. Currently the company is working on developing what it calls the "minimal genome - one containing the least number of genes to allow it to survive in a specific environment." Researchers can then add the specific genetic information of interest.

Codon Devices in Cambridge, Massachusetts claims to be the first venture backed synthetic biology company, raising $13 million from Flagship Ventures, Alloy Ventures, Kleiner, Perkins Caufield & Byers and Sun Microsystem founder Vinod Khosla. According to Signals, its founders are "among the Who's Who of synthetic biology practioners" - George Church of Harvard, Drew Endy and Joseph Jacobson of MIT and Jay Keasling of the University of California Berkeley. Codon is focused on synthesizing very long pieces of specified DNA - kilobase to megabase length. The pieces of DNA can then, in turn, be used to form a library of engineered parts. According to Codon president and CEO John Danner the company is now offering its services to researchers, but he looks for the company's future business "not to do one or two constructs...we will typically have large customers or high value customers."

CODA Genomics in Irvine, California is the third company to receive VC funding in 2005, approximately $10.8 million from the Tech Coast Angels. The company was formed by University of California Irvine researchers Richard Lathrop and G. Wesley Hatfield under an Information Technology Research award from the National Science Foundation. CODA's technology, computationally optimized DNA assembly (CODA), "allows large-scale production of synthetic genes that are optimized to make only one correct protein product." Additionally, the technology allows for the "control of the translation kinetics, i.e., regulating the speed of protein elongation during translation." The end result, according to CODA, is a "thermodynamically favored, perfectly correct protein."

The Biotechnology Industry Organization (BIO) has posted on its Website a twenty-minute video, "New Biotech Processes Revolutionize Domestic Energy Production." The video explains how industrial biotech can enable the development of alternative forms of energy not by "drilling," but by "tilling." Included in the video is an animated version of how enzymes, specifically cellulases, assist in turning biomass into ethanol. Among those interviewed are Jack Huttner from Genencor and Jim Stoppert from Cargill.

Additionally, BIO has posted a new primer on industrial biotech, "The Third Wave in Biotechnology." The three-page document provides information on what industrial biotech is, gives "real world" examples of how it is being utilized and provides a listing of activities and processes industrial biotech companies are engaged in.

At the recent INFORMEX custom chemical exhibition, several announcements confirmed that custom chemical companies are pushing further into biotechnology. A Chemical & Engineering News article says that Western companies are hoping that by engaging in areas that are high-tech and fast-growing, such as biotech, they will be "insulated from emerging Asian competitors." Biocatalysis was one area frequently mentioned with several company's activities cited:

Chemical & Engineering News examined the possible role of Novozymes and Danisco subsidiary Genencor in U.S. government plans to encourage biomass ethanol production. The magazine noted that President George W. Bush called in his State of the Union speech for $150 million for research into new methods of making ethanol "not just from corn ... but from wood chips, stalks, or switchgrass" so that biomass-based ethanol could be "practical and competitive" within six years. Investors boosted the stock prices of both Novozymes and Danisco following the January 31 speech. The traditional ethanol business has benefited enzyme producers, with Novozymes' enzyme sales to the ethanol industry rising faster than the 15% increase in U.S. ethanol output. While biomass ethanol has potential for Novozymes and Genencor, the major hurdles to commercialization are creating an infrastructure to collect biomass and developing "biorefineries" that integrate collection, treatment and fermentation into an efficient production process. One difficulty is fermenting the five-carbon sugars that are a significant percentage of cellulosic biomass. Genencor executive Jack Huttner said the government needs to step in, and he recommends that the U.S. Department of Energy sponsor competing teams of scientists, farmers, and others who would come together to build working biorefineries at perhaps one-tenth of their expected commercial size. The chief science officer at Novozymes, Per Falholt, estimates that making biomass ethanol commercially would currently cost about 50% more than corn-based ethanol does.

German chemical company BASF and US biotech company Diversa have announced a "significant expansion" to their relationship which began in 2001 for the development of catalysts. Under the new agreement, Diversa will be responsible for the discovery and optimization of new enzymes and BASF will be responsible for product and process development and commercialization. Dr. Alfred Hackenberger, BASF's President of Specialty Chemicals Research says the two companies will use their expertise in chemistry and biotechnology "aiming at system innovations for diverse industrial applications...in several key markets like pulp and paper or fine chemicals." Edward T. Shonsey, Diversa CEO, says that with the company's enzyme expertise, Diversa "will become a strategic partner in BASF's biotechnology activities and will...assist BASF in extending its well-deserved reputation as one of the industry leaders in the development of innovative bio-based products."

Degussa AG Management Board Chairman Prof. Utz-Hellmuth Felcht has announced his company's intent to increase the percentage of sales from renewable materials to ten percent from the current five percent over the next five years and to 20% over the next ten years. Dr. Alfred Oberholz, the Degussa Management Board Member responsible for R&D, says, "The use of renewable materials in the chemical industry is set to become one of the most important research areas over the next few years." The company emphasized the importance of industrial biotech to its future growth with the January 1, 2006 opening of its new Science to Business Center Bio, where Degussa researchers will be working with universities and industry partners to develop new biotechnology processes and products.

Degussa cites its many years of experience with fermentation technologies as playing a key role in future products. Its ProFerm Project House, which has been in operation for two years, focuses its activities "on manufacturing specialty chemicals, comprising the research areas of food and pharmaceutical amino acids, bioactive ingredients in cosmetics, thickeners and high-throughput processes."

· API Corp., Mitsubishi Chemical Holding Group's active pharmaceutical ingredients and intermediates contract manufacturing division, will use its technical knowledge in organic synthesis and biotechnology to secure consigned manufacturing orders from top drug companies worldwide. API is developing a line of products that employ enzyme reactions at its Mitsubishi Chemical Group Science and Technology Research Center.

· Tennessee Gov. Phil Bredesen signed an executive order creating an "alternative fuels working group" with officials from six state agencies to consider developing an alternative fuels strategy for the state. One project involves a researcher at Oak Ridge National Laboratory who has spent more than a decade looking at how to raise switchgrass as an energy crop.

· ZyGEM, a New Zealand company, launched new and unique DNA extraction products based on soil samples collected 25 years ago in Antarctica. The products are based on an enzyme isolated from a bacterium discovered in the soil samples, and developed by Waikato and Auckland universities. ZyGEM says its products could combat terrorism, speed up criminal investigations and improve biosecurity and food safety.

· The U.S. Department of Homeland Security approved a bioassay developed by Strategic Diagnostics Inc. (SDI) of Newark, Delaware. DHS approved the Microtox Bioassay technology, which SDI President Matthew Knight called "the water industry bioassay standard for rapid detection of toxins."

· Biotech company OmniLytics Inc. of Salt Lake City, Utah announced final U.S. Environmental Protection Agency (EPA) registration for its AgriPhage bacteria-control product line. AgriPhage products can be used in the greenhouse and in the field.

· Using biotechnology "as a base to solve problems" is said to be the philosophy of Athena Environmental Sciences of Catonsville, Maryland, which developed MagiGlue, its first consumer product. MagiGlue is said to be an "all-natural non-toxic glue composed of organic polymers, completely free of petroleum and animal by-products."

· Panasonic has developed a prototype of a multi-task biosensor that can detect the presence of disease markers in the blood sample. The compact multi-task biosensor (MBS) uses an enzyme-enhancement and electrochemical method to detect the markers.

· Industrial Biotechnology Corp. of Sarasota, Florida and Chungwa Chemical Synthesis & Biotech Co. announced they have entered into a strategic process development and manufacturing and production agreement. Chungwa is the largest bulk pharmaceutical manufacturer in Taiwan.

(Japan Chemical Week 2/2/06; Associated Press 2/17/06; Waikato Times 2/16/06; Business Wire 2/15/06; The Daily Record 2/10/06; JCN Newswire 2/17/06; PR Newswire 2/21/06)

The United States Patent & Trademark Office (USPTO) has announced it awarded patent number US 7,000,000 to DuPont for "Polysaccharide Fibers," which are "cotton-like" fibers derived from biologically based renewable resources. Like Bio-PDO, the key ingredient in DuPont's new Serona® fabric, the polysaccharide fibers can be made from renewable resources such as corn and are manufactured using a new biological process requiring 40% less total energy than alternative petrochemical-based processes. Inventor and senior researcher Dr. John P.O'Brien says the patent "embodies many of the elements of an exciting new frontier, one that is at the interface between biological science and materials science." The press release said that according to the publication Nature Biotechnology, DuPont and its affiliates ranked 2nd worldwide with the most biotechnology patents approved by the USPTO in 2004.

PCAS, described as a "supplier of fine and specialty chemicals listed on the Euronext stock market," and biotech company Proteus have announced they are forming a joint-venture company, PCAS Biosolution, which will focus on "the synthesis of active pharmaceutical ingredients, intermediates and building blocks using new chemo-biocatalytic manufacturing routes," which will combine chemistry and biocatalysis. Daniel Dupret, Chairman and CEO of Proteus says his company has developed a wide range of enzymes for specific chemical reactions, including all classes of catalytic activities relevant for fine chemistry such as esterases, nitrilases, amidases, epoxyde hydrolases and others. Christian Moretti, PCAS chairman, says "our customers will benefit from all the value drivers of integrating biocatalysis into chemical processes."

Ambri to Develop Bird Flu Rapid Diagnostic Test; JV Awarded $45K Government Grant

Australia's Ambri Ltd. plans to use its proprietary ICS biosensor technology to commercially develop a rapid diagnostic test chip for human respiratory infections, including avian influenza (bird flu) type H5N1. A recent lab test "proved that Ambri's ion channel technology can perform three different assays at the same time in a rapid test format on a single chip." CEO Roman Zwolenski said Ambri will develop a three-test chip to distinguish serious new infections, such as bird flu, from "common influenza strains such as Flu A or Flu B." The company's near-term objective is to develop a prototype of a chip that would "simultaneously detect, in a nasal or throat swab, the presence of any one of three influenza viral types."

(Ralph Wragg Australian Business News 2/16/06; Australian Company News Bites 2/21/06, 2/14/06)

Canadian Renewable Energy Industry Anticipates Government's Renewables Policy Will Continue

Following the election of Conservative Prime Minister Stephen Harper, the Canadian renewable energy industry is reportedly "playing down fears that renewables development will be significantly altered or that the country will suddenly withdraw from the Kyoto Protocol." Renewable Energy Report interviewed several key players, including Canadian Solar Industry Association president Jean-Pierre Pawliw, who believes the Conservatives' minority-government status is significantly "tempering what a lot of people feel is a considerable risk." Pawliw did, however, express concern that the government's Renewable Energy Deployment Initiative -- a C$51 million program "designed to stimulate demand for solar thermal and biomass systems" -- could be "suspended through government inaction or wrangling."

The US Department of Energy (DoE) announced it transferred $5 million "from other accounts" to Midwest Research Institute, the operating contractor for the DoE's National Renewable Energy Laboratory (NREL) last weekend. The press release, issued prior to President Bush's visit to the NREL on February 21, said the NREL director will reportedly "use these funds to immediately restore all of the jobs that were cut earlier this month due to budget shortfalls." On February 7, the lab announced the layoff of 32 employees, including eight researchers. The AP said NREL's laid-off employees were "relieved but concerned about the nation's commitment to achieving energy independence." Industry observers commented that "private industry, motivated by Bush's new fuels and vehicles initiative, will likely snap up out-of-work NREL personnel, thereby complicating DoE's re-staffing plans." Senator Ken Salazar, D-Colorado, said he met with Bush last week and stressed the lab is the "crown jewel" of renewable energy research and technology. Salazar said Bush "indicated he would request additional funds for NREL in the 2007 budget."

(Associated Press Newswires 2/21/06; US Fed News 2/20/06; Rocky Mountain News 2/21/06; Energy Washington Week 2/22/06)

A team from the Agricultural Research Service's (ARS) Plant Polymer Research Unit in Peoria, Illinois has used cornstarch to create biobased polymers that "bend and contract slightly when pulsed with electricity." The researchers reportedly demonstrated that plant polysaccharides, like starch, "can work just as well" as petroleum-based electroactive polymers in industrial and biomedical applications. A stated potential use for the biopolymers is the recharging of lithium batteries. Details of the research were published in the December 2005 issue of Agricultural Research.

An article in the February issue of nanotoday says that while the use of nanoparticles in place of conventional molecular fluorophores has "led to improvements in sensitivity, selectivity, and multiplexing capacity...further simplification is needed to take these technologies from the laboratory to point of care." Currently DNA assays rely on a combination of amplification by polymerase chain reaction (PCR) and detection using fluorophores as labels. Additionally, arrays with thousands of unique probe sequences have been constructed. However, the article says several major drawbacks still remain: broad absorption and emission bands and nonuniform rates of fluorophore photobleaching can reduce accuracy; sophisticated algorithims and expensive instrumentation for fluorescence restrict applications to laboratories; and selective and nonlinear target amplification in PCR can distort gene expression. The article discusses in length the use of gold nanoparticles, quantum dots, magnetic nanoparticles and silica nanoparticles. The article concludes saying, "Tremendous opportunities exist in the application of nanoparticles for biomolecular detection."

Japan's National Institute of Advanced Industrial Science (AIST) has announced the development of a fluorescent quantum dot with "superior properties." The On-Site Sensing and Diagnosis Research Laboratory, an AIST entity, has synthesized a "water-soluble and highly luminescent quantum dot...made of cadmium selenide." Additionally, the lab has created a hybrid material by combining the quantum dot with "protein avidin and biomolecule biotin." The new material is said to detect proteins with high sensitivity. AIST plans on using its new findings to develop an electrophoretic chip for indentifying natural proteins. It also plans to employ the quantum dot in the evaluation process of food manufacturing.

New Report Alleges Multinationals, Including Genencor, Are 'Looting Africa's Diversity'

A new 42-page report, entitled "Out of Africa: Mysteries of Access and Benefit Sharing," alleges that giant pharmaceutical and biotechnology firms from the West -- including Genencor International -- and a university in Israel have "illegally acquired" biological resources from Kenya "in an ongoing international operation that blatantly disregards the provisions of the international Convention on Biological Diversity." The document, authored by Jay McGown and released by the Edmonds Institute of the US, the African Centre for Biosafety and other non-progit groups in both the US and Africa, "shows that Kenya is the biggest loser" among East African countries.

Articles in The New York Times and All Africa discuss the report and its references to Genencor, which purchased, patented and cloned extremophiles taken from Kenya's Lake Bogoria by academic researchers in 1992. Both articles cite the Kenyan government's lawsuit against Genencor seeking compensation for profit from the microbes. According to The New York Times, Kenya Wildlife Service spokeswoman Connie Maina said, "We're having discussions with them [Genencor]," and Genencor's statement said, in part, that it "welcomes an open dialogue with appropriate Kenyan authorities and looks forward to a positive resolution." The article also notes Genencor "has said that the enyzmes derived from Kenyan lakes are not huge money earners, taking in less than $10 million, and that it has donated computer and sampling equipment to Kenyatta University's microbiology department. Kenyan officials say they believe that the profits are far more than the company is letting on..."

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