The prairie countryside in the summer is a riot of colour-green fields of
wheat, yellow fields of canola, blue fields of flax. If you know where to
look, you might also find the odd orange field of insulin. And those orange
fields could paint a picture of the future of drug manufacturing.

Plant-made pharmaceuticals, are increasingly being touted as the way to
manufacture new generations of drugs cheaply and efficiently. It's
cutting-edge biotechnology, and two Canadian companies, Calgary-based
SemBioSys Genetics(TSX: SBS)and privately held Medicago of Quebec City, are
hoping to ride the crest of a bio-pharming wave.

Traditionally, of course, drugs are manufactured using chemical processes in
huge industrial plants. It's a cost-effective way to produce some compounds,
but it's limited in that chemical synthesis cannot make complex molecules
like proteins and peptides. That, according to Medicago CEO Andy Sheldon, is
where biotechnology comes in--"to produce more complex molecules which lead
to treatments of diseases that couldn't be treated before." Biotech has long
had an impact on farming--controversial as they are, first-generation
genetically modified crops have made the farmer's life easier. Now, however,
second-generation GM crops could turn plants into efficient biological
factories.

Sheldon says the demand for proteins to make pharmaceuticals is predicted to
explode over the next five or six years. "The market will go from about
US$35 billion in 2007 to about US$100 billion by 2011," he adds. But these
are early days for bio-pharming. Andrew Baum, CEO of SemBioSys, says there
are only about a dozen companies seriously involved in it globally--a few in
the United States, a few more in Europe, and the two Canadians. Many more
are gestating in universities. So far, none has pharmaceutical products on
the market, though several, including both Canadian companies, are expected
to go to clinical trials by the end of 2006.

Ross Bricker, vice-president of investments with Avac Ltd., a private
not-for-profit bio-products investment company in Calgary, was an early
backer of SemBioSys. He says the company is at the cusp of making a
significant market entry in plant-made pharmaceuticals and industrial
products. "We see the demand for pharmaceuticals and wellness products
outstripping the supply," Bricker adds. "The biotechnology industrial
application side is really at the start of a fairly large development
curve."

To make insulin for the treatment of diabetes, SemBioSys has genetically
modified safflower, a crop more commonly used to produce cooking oil. The
company employs the same crop to make a protein called Apo A-I, used in the
treatment of cardiovascular disease. Meanwhile, Medicago takes genetically
modified alfalfa, grown in greenhouses, and produces proteins and monoclonal
antibodies that could be used to treat cancer or fight infections like
antibiotic-resistant golden staph(Staphylococcus aureus), which plagues
hospitals. Medicago uses alfalfa to produce a large amount of human
antibodies--the same antibodies that your immune system generates to fight
infections.

Vaccine production is another exciting possibility for PMP. Many health
professionals are worried that the current avian flu outbreak in Asia could
lead to a global pandemic. But developing any new vaccine takes time. To
make matters worse, typical flu vaccines are grown in eggs--and the avian
influenza virus could kill any eggs used to manufacture vaccine. It
wouldn't, however, kill an alfalfa plant. "Speed of production is also going
to be critical," Sheldon says. "We know we can produce millions of doses of
products very quickly in a two- or three-thousand-square-metre greenhouse."

The biggest advantage in turning plants into pharmaceutical factories could
be their dramatic impact on the cost of goods. "Developing new medicines
under current production methods costs quite a lot of money," Sheldon says,
"and everyone knows the health-care system may not have the capacity to pay
for all drugs for all people. We hope that PMPs will have an impact on the
cost of medicines as they become licensed."

SemBioSys was able to produce insulin so efficiently in arabidopsis, a weed
used in genetic research, that when the company switches to safflowers, Baum
estimates just 10,000 to 15,000 acres of the plants could meet the world
demand for insulin. That may sound like a lot, but it represents just "a few
mid-size Saskatchewan farms," Baum says. Even with a purification and
extraction plant, Baum argues that insulin would be far cheaper to produce
through bio-pharming than through traditional processes. "We believe we can
reduce capital costs by 70% or more," he says, "and the cost of goods by a
minimum of 40%."

In animal models, the Calgary company's arabidopsis-produced insulin has
been demonstrated to be the equivalent of Humulin, an insulin manufactured
by Eli Lilly. The plan, Baum says, is to start clinical trials by the end of
2006 and get on the market by 2009. "It is an ambitious objective," he
admits. "A lot of things will have to break our way, but you have to be
ambitious in your targets."

But the hurdles could be significant. Before any company gets regulatory
approval for a plant-made pharmaceutical, it will have to demonstrate to
regulatory bodies that their products' genes cannot escape into the
environment. Environmental groups are already raising concerns about errant
pharmaceutical genes finding their way into food crops, and both Canadian
companies say they take containment seriously. The issue is particularly
important for a crop like alfalfa, which normally is grown for livestock
feed. No company would want to deal with the public-relations nightmare of
having a stray herd of cattle coming across a field of GM alfalfa and dying
from a drug overdose.

Medicago has addressed the issue, Sheldon says, by confining its crop.
"Containment was one of the reasons we chose to grow our alfalfa in
greenhouses," he adds. "Nothing can get in and nothing can get out. There is
no possibility of gene dispersal. There is no possibility of animals
nibbling on the plants. Our greenhouses use true containment."

Concerns over containment drove SemBioSys, meanwhile, to use safflower-a
nastily spiked plant that resembles a thistle--as its GM crop. "Its biology
makes it easy to confine," Baum says. "Safflower is an uncommon crop
everywhere. It has no weed relatives in the Western Hemisphere, the pollen
doesn't travel by wind, and it is largely self-pollinated." The safflower,
he adds, is grown under the strictest guidelines, which follow
government-approved standard operating procedures. "Every aspect of
production, from field selection to cleaning equipment after the harvest, is
completely dictated by standard operating procedures," Baum says. "We have a
book of SOPs that I would estimate is literally several inches thick. We
have an SOP on how you select a field, on how you clean a grain drill, on
how you pack material for shipping and on how you scout a field after
harvest. It just goes on and on."

So will bio-pharming revolutionize the way that rural Canada makes money? It
does not seem likely. All those containment issues have a big downside for
farmers: they mean that a bio-pharmed crop will never be considered just
another crop. And that means PMP crops are not likely to provide a cure-all
to the stubborn problem of low farm incomes in Canada. "I think this will be
a lucrative business for a small number of farmers," Baum says. "You don't
need a lot of them, because the acreages are relatively small. I think it
will be lucrative for the rural economy, since we will be injecting a lot of
money, but I don't want farmers to think this is going to be something that
represents millions of acres of production."

Brent VanKoughnet, a farmer and owner of Agri Skills, an agriculture
innovation company in Carman, Man., says he thinks that since PMPs are a
difficult crop to grow, they could in fact offer a few farmers an
opportunity to make money. "If it was simple to grow, producers would fumble
all over themselves to grow it until the premium has been reduced to just a
few nickels above traditional crops," VanKoughnet says. "If it is complex,
if only an elite can meet their standards appropriately, then these few can
get paid quite well for their efforts."

On the other hand, those farmers looking to get rich on the bio-pharming
trend will have to deal with onerous regulatory and intellectual-property
issues. It's not, Baum says, that "we think we know more about agriculture
than farmers, but this is what we have to do to follow the regulatory
guidelines. A lot of farmers are just going to look at everything involved
and say, 'Heck, it isn't worth it.'" For those reasons, Baum adds, SemBioSys
wants to work only with farmers who are really comfortable with someone
telling them how to grow their crops. Which could be a big challenge,
too--since some might say that's a breed of farmer that's every bit as rare
as an insulin-producing plant.

www.checkbiotech.org