The Sept. 2 announcement in Ottawa of a research and marketing alliance between Saskatoon-based Dow Agrosciences Canada Inc. and Performance Plants in Kingston heralded the introduction of new gene technology expected to have an impact of more than $200 million annually on Canadian farmers.
The alliance marks another step in a growing trend whereby universities, strapped for research funds, spin-off independent revenue-producing research companies which encourage private investment and alliances with business concerns to address the specific needs of industry.
The $2.2 million investment by Dow Agrosciences will fund research and operating costs to advance the development of Growth Enhancement Technology (GET) and Augmented Microbial and Plant Expression Technology (AMPLE) developed by Performance Plants.
The technology will enhance the value of silage corn, cotton, sunflowers and peanuts by increasing crop yields through development of larger, more vigorous plants. The technology will also produce next generation canola varieties that exhibit drought resistance and the ability to produce increased quantities of oil.
In making the announcement, Dow Agrosciences' Dave Dziak said, "The current farm-gate value of canola is approximately $2.5 billion annually in North America, and 85 percent of that is in Canada. A 10 percent increase in Canola yields resulting from GET technology would add $250 million in value to farmers annually. Whereas a 10 percent increase in oil content from the AMPLE technology would add $230 million in value annually to canola processors."
Performance Plants President and CEO Dr. David Dennis said, "We chose to partner with Dow Agrosciences because they have demonstrated a strong commitment to the biotechnology industry in Canada and we believe they are the best company to take our technology global. GET and AMPLE are facilitating technologies and Dow Agrosciences' investment means that we will now be able to directly benefit farmers, processors and consumers," he said.
Over the past five years Dow Agrosciences has invested more than $25 million in Canadian biotechnology research and development.
For Permanent Plants, the deal with Dow Agrosciences is just one of many alliances they hope to conclude with the agro-industry. They currently have made patent applications or licensing agreements for 14 bio-technology procedures.
1. Growth Enhancement: Enhancing the light harvesting complex of plants enhances growth and development of tobacco, canola, lettuce and Arabidopsis especially under low light conditions.
2. Fibre Reduction: Transgenic tobacco has been developed that has reduced levels of lignin in the seed coat. Canola is being transformed with this construct to reduce the fibre content of meal.
3. Chloroplast Protein Transport Enhancement: Trans-genic plants over-expressing a chloroplast transport protein have a larger seed size.
4: Enhanced Export of Proteins in Bacteria: Bacteria expressing the chloroplast transport component have enhanced the transport of proteins out of the cell and increased protein synthesis of foreign proteins.
5. Enhanced Oil Synthesis: Demonstrated enhanced oil synthesis in tobacco plants, with a series of canola lines transformed with the same genes that have not yet been analyzed.
6. Phosphate Stress Technology: A series of genes have been isolated that are affected by phosphate stress. These genes include those for enzymes as well as regulatory proteins. The impact of these genes on phosphate utilization, flowering and growth in transgenic plants is being investigated.
7. Phosphate Genes: Several genes for very stable plant phosphatases have been isolated. These are different from known phophatases.
8. Phosphate Deficiency promoter: A promoter has been isolated that is regulated by phosphate starvation in plants.
9. Modification of Sugar Levels: Demonstrated that it is possible to modify sugar and starch levels in tobacco seeds and leaves. This technology is being transferred to canola and potato.
10. Antifreeze Proteins in Plants: Exploring the possibility of producing antifreeze proteins in plants either as a plant cryo-protectant or as a product in its own right. Licensed for AF Proteins.
11. Phytate Reduction in Meals: Exploring the possibility of using phosphate stress genes for phytate reduction in seed meal.
12. Plastid Transit Peptides Isolated a series of transit peptides for the transport of proteins into plasids. These appear to use different uptake mechanisms. This could be important if more than one protein has to be inserted into plastids.
13. Drought Tolerance: A technology is being developed with the University of Toronto to confer drought tolerance on plants. Exclusively licensed to Performance Plants. and patent application filed.
14. Enabling Technologies: Performance Plants has developed some enabling technologies and is developing others.
An impressive shopping list for investors who want to get in on the ground floor of a growing bio-technology industry. For the farmer, the research will ultimately translate in five to seven years in higher per acre yields and increased profits for a variety of cash crops.
For Performance Plants President Dennis and his team of 20 researchers, the deal with Dow Agrosciences facilitates the continuation and expansion of applied research, much of which began in the labs of Queen's University.
As Canada slipped behind other industrialized countries in funding for basic and applied research and development as a percentage of gross domestic product, universities, forced to tighten their belts, had to come up with innovative ways to use the pool of scientific talent that was available.
In December, 1995, the same year the first approvals for commercialization of transgenic products were granted in the United States, Dennis, 61, a biochemist and head of Queen's biology department, and Queen's biochemist Daniel Lefebvre, 43, were approached by Partech, the technology transfer arm of the university, to form an independent company to continue work on genetically modifying the metabolism and morphology of plants.
Parteq provided initial seed money and business acumen to get the project off the ground, but the company is an independent concern with Parteq retaining a 12 percent interest. Other initial funding came from provincial and federal organizations. In 1996, the company received a $1.5 million investment by venture capital firm Carr Industries of Dorval, Quebec, which also provided expertise in management and attracting investors. In the Fall of 1997 a second laboratory was opened at Innovation Place in Saskatoon.
Each member of the company has an international reputation for innovative research covering each stage in the development of genetically transformed plants, from gene isolation and cloning to biochemical and physiological analyses of the transformed material. Existing technology was licensed from Queen's University and the company continues to use Queen's lab space in the Biosciences building.
For Dennis, the most important factor in attracting funding is to first find out what the problems are and tailor the research to meet the needs of the farmer and industry.
It was advice from Pete Desai "who suggested that we determine what the industry wanted rather than just ask for money for our university research. It resulted in some very interesting interviews with companies when we made no mention of money."
"Now government is giving more and more money to specific research jobs at the expense of basic research and I think it is a shame," Dennis said.
Many important discoveries are made during basic research, sometimes they are fortuitous accidents such as the one that has led to Performance Plants developing drought resistant plants.
"Peter McCourt of the University of Toronto was doing basic research on plant mutations and one weekend a graduate student neglected to come in and water the plants. When McCourt came in on Monday, half of the plants had died, but the mutated plants were thriving. It wasn't what they were looking for but it didn't take long to realize the importance of their discovery," Dennis said.
Performance Plants has since licensed the technology from the University of Toronto and the ramifications for the farming industry could well be far reaching.
One of the major problems for research institutes is that it generally takes a long time to bring a research project to fruition and often money gets scarce.
One of two things often happens: either because a project takes six or seven years to complete, a smaller research company will simply fold for lack of funding or a large multinational will come in and buy out the company, take over the technology and shut down the company or move the research company, often to the United States.
That puts scientists out of work or precipitates a brain drain that is followed south inevitably by the value-added jobs that would otherwise have been located in Canada.
Another problem is the increasing concentration of power, through mergers and buy-outs, in the hands of four or five multinational agro-industry giants which are approaching monopoly status. Dennis predicts that in five to seven years many farmers will, in effect, be employees of the major seed companies, growing their crops under contract directly for the multinationals using this particular seed.
That is not entirely bad news for farmers if it means less use of pesticides and herbicides, higher yields and profits with a guaranteed price when they plant in the spring, and provided the multinationals do not reach a monopoly situation that allows them to choke off competition and reduce farm-gate prices.
And on the upside, biotechnological research and development is so expensive that often it is only the richest companies that can afford to see a project through to fruition.
Performance plants plans ultimately to double the size of its research team. By holding on to the patents on technology it develops and through licensing and shared technology, it promises to be a major player in the biotech field for many years to come.