UN seeking to regulate trade and use of biotechnology at

UN seeking to regulate trade and use of biotechnology at
negotiations in Southeast Asia

A.H. Zakri and W. Bradnee Chambers, Kuala Lumpur

Two years ago the World Summit on Sustainable Development
yielded a controversial decision to launch negotiations on a
global regime to regulate the access and use of genetic
resources.

These negotiations are now finally underway at the Seventh
Conference of Parties to the Convention on Biological Diversity
(COP7) in Kuala Lumpur (Feb. 9-20), but volatility in the global
biotech market and deep-seated differences between rich and
poor nations is painting a gloomy outlook for success.

Genes may be small in size, but they are not so small in
value. Used as active ingredients in products ranging from
biopharmaceuticals to cosmetics, trade in genetic resources
represents a multi-billion dollar global market.

Many so-called user countries, which have the biotechnology
and pharmaceutical base to develop the genetic resources into
commercial products, oppose stringent regulations. These
countries, such as Japan and the U.S., are concerned that
regulation will restrict their access to the resources, and will
artificially hike up the price of genetic raw materials.

The owners of the genetic resources are mostly developing
nations -- such as Brazil, Columbia, China, Indonesia, Malaysia
and Mexico. These countries hold by far the greatest reserves of
the world's biodiversity and therefore the greatest variety of
genetic material. They believe that if their resources and local
know-how is going to be commodified, then they should have a fair
share of any potential profits.

In a long history of commercial exploitation and economic
colonialism, these countries have become weary of foreign
development. They view their genetic resources as green gold and
perhaps the last untapped resource they have to protect.

Unless some of these divisions are settled early, the
negotiations will end up never getting off the ground or the
outcome will be so watered-down that the effectiveness of the
regulations will be very low.

But one possibility that would pre-empt this unwanted outcome,
and potentially lead to an earlier resolution, is to agree on the
basic perimeters of the potential regime at the outset,
specifying which components would be treated under international
law, and what should be left to domestic legislation. This
approach is gaining credibility.

The Institute of Advanced Studies of the United Nations
University based in Japan recently released a report that fleshes
out what some of these basic perimeters might look like. The
report, Options for Developing Measures in User Countries, puts
forth several key areas where there could be a potential need for
international regulation. A first step would be to create import
and transport regulations. Existing customs procedures could be a
relative simple measure to regulate the import of genetic
resources and control cross border flows of genetic materials.

The report points out that a standardized code of conduct and
certification could also be useful to curb exploitation. An
international standard, like many codes already in existence for
various professional organizations, could work as a public moral
system, shape professional use by scientists and business and
ensure ethical and fair commercialization.

Another important consideration raised in the report is the
need to adjust to the global intellectual property regime to
require patentees to disclose the origin of the material in their
patent applications.

This proposal is potentially controversial because would
require adjustments be made in international patent standards
under the World Trade Organization. Sensitive as it may be, many
experts believe that this would be an effective means to avoid
foreign commercialization without the express permission of the
owners.

The report also recommends the idea of creating an
international ombudsman such as the UN where infringements and
opportunities for redress could be taken up.

Finally, the Swiss Government has proposed yet another policy
alternative to an international regime: A certification scheme.
A Swiss-backed study concluded that certification has already
been successfully applied to a wide range of industries, such as
logging and fishing, and could also be adapted to bioprospecting
and use of genetic resources.

Such a scheme would verify that the appropriate international
standards have been met, that the product used the genetic
material with permission from its owners and that some kind of
benefit sharing was agreed upon through mutually agreed terms.

The rush to regulation may, however, encounter more
fundamental problems that could slow its pace. A decade ago
genetic resources were a hot commodity, the human genome was
being decoded and biotechnology was thought to be the key to the
next wonder cures for ills ranging from heart disease to cancer.
The speculation resulted in early partnerships between companies
such Merck Drugs and countries such as Costa Rica that were
reportedly worth millions of dollars.

Today the natural product market is in decline and companies
are increasingly turning to synthetic ingredients for drug
development and research. Scientists are saying that they have
plenty of genetic materials from gene banks and existing
collections to keep their needs satisfied for several years to
come.

So they see no need for their companies to go tramping through
the rainforests looking for new material. With the stock market
on the decline, biopharmaceuticals companies are now switching to
less riskier investments. The volatility in the market combined
with low demand for genetic resources has raised the obvious
question of why there is such a hurry to create international
regulation.

But the woes in the market are not dampening the hopes of
those countries with rich biodiversity. They see the missed
commercial opportunities of the past. Today, the global market
for drugs and health products that use active natural ingredients
has been estimated to be worth billions of dollars annually.
These developing countries are hoping that the human mind will
never be able to copy what Mother Nature can do naturally.

So, they are looking to the future when that next big boom in
demand and knowledge will bring the bioprospectors back to their
countries. And, at that time, they plan to be ready with a
global regime in place and a domestic regulatory system that will
allow ready access to their resources but which will also ensure
they don't miss out on that next big Klondike rush.

A.H. Zakri is the Director of the United Nations University
Institute of Advanced Studies (UNU-IAS) and a former negotiator
to the CBD for Malaysia W. Bradnee Chambers is the Senior
Programme Coordinator also at the UNU-IAS. These are their
personal views.