EC rules on genetically altered foods pose threat to U.S. biotech industry

July 04, 1992|By Paula L. Green | Paula L. Green,Journal of Commerce

The biotechnology industry in the United States appears to be heading toward a collision with most of the world over the regulation of genetically altered food products.

The U.S. industry praises a recent U.S. government decision minimizing regulation, but the European Community is preparing a directive on "novel foods," the regulatory requirements for which could hamper exports of such items to the EC.

"I'm not aware of the EC proposal, but there is worry that this [regulatory issue] could be a trade weapon . . . . The politicizing of an issue [could be used] for trade purposes, like the hormone and beef issue," said Joyce Nettleton, director of scientific public affairs at the Institute of Food Technologists in Chicago, a professional society of about 25,000 food scientists.

"There's enormous potential for this to be a non-tariff trade barrier," Ms. Nettleton said.

The United States and the EC clashed several years ago over an EC ban on the sale of hormone-laden meat. U.S. exporters of meat products, especially beef, were seriously affected.

"The industry is extremely concerned that misinformation could lead to policies that would short-change everybody: consumers, agriculture, the economy," Ms. Nettleton said. "We're concerned that the policies would be based on hysteria."

New vaccines for animals, medications that treat cancer and tomatoes with longer shelf life are among the products that have emerged from the U.S. biotech industry over the past decade.

Among the industry's leading companies are Genentech Inc. of South San Francisco, Calif.; Calgene Inc. OF Davis, Calif.; and Centocor of Malvern, Pa.

Last year, U.S. biotech producers sold about $2 billion worth of pharmaceutical products and $30 million to $50 million worth of agricultural products -- including food and chemicals -- to domestic buyers, industry sources said.

The industry estimates that sales in the United States alone could reach $22 billion a year by the end of the decade, with agricultural products catching up with pharmaceutical products.

It predicts that sales worldwide by U.S. and other biotech companies could reach $70 billion a year by 2000.

Meanwhile, at the Earth Summit in Rio de Janeiro, the regulation of genetically engineered products -- including food and pharmaceuticals -- remained a little-publicized aspect of the controversial biodiversity convention.

Under the treaty, which is supported by the EC and developing countries, rich nations' access to Third World natural resources is linked to funds designed to help poor nations develop. The treaty also says something is due the owners of natural resources for goods produced from them.

The United States contends that the convention's potential to limit patent protection for U.S.-made products sold in developing nations is the main reason for its decision not to ratify it.

But treaty language that implies there is a potential risk in biotechnology products, and that they should be regulated, is another reason for the U.S. government's opposition, said Peter Thomas, a conservation officer with the Department of State.

"The main concern on biotechnology is that there is mention of it," said Mr. Thomas, who works in the department's Bureau of Ocean and International Environmental and Scientific Affairs. He said the treaty goes against the U.S. philosophy of minimal regulation of the industry.

The U.S. government wants to protect the advances of its biotechnology industry, he said.

Richard Herrett, a director at the Association of Biotechnology Cos. in Washington, said there is always concern that international regulations could create non-tariff trade barriers for U.S. manufacturers.

"But we have to see how that plays out," said Mr. Herrett, who heads his own Bethesda consulting firm, Envirag Associates.

The main companies in the agricultural sector are small ones concentrating on the domestic markets, but exports are expected to play a large role in the industry's growth over the next decade, he said.

A few weeks ago, the Food and Drug Administration said in a policy statement that foods developed through biotechnology are not inherently dangerous and, except in rare cases, do not require special testing and regulation before sale.

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