UN seeks rules on trade and use of biotechnology

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.