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18. Proposal for a Microbial Semi-Commons: Perspectives from the International Cooperative Biodiversity Groups – Flora Katz44 Fogarty International Center, National Institutes of Health The Fogarty International Center is the only component of the National Institutes of Health (NIH) that is specifically mandated by Congress to work internationally. We are now in our 40th year. We work in about 100 countries, and in the past 15 years we have mainly focused on low- and middle-income economies, including the so-called developing countries. In my presentation I will discuss the issue of increasing access to microbial samples from these countries from the perspective of the International Cooperative Biodiversity Groups, a program we have been running for the past 16 years. First, let me address the question: Is access to microbes from developing countries important? We actually do not know. The presumption is yes, but more than 99 percent of global microbiodiversity is still unknown. We do know that microorganisms are not uniformly distributed on the earth—one of our groups did a study comparing New Jersey and Kyrgyzstan, and there was little overlap—and we also know that developing countries are the most biodiverse on a macroscopic level. Furthermore, many of the microorganisms track with those macroscopic organisms, like endophytic fungi. So it is likely to be the case that developing countries will be an important source of microorganisms. We have already discovered a number of important new chemicals from microorganisms in these countries, and we have discovered new species in the genera of actinomycetes, which has been sort of the mother lode for drug discovery. We also know that biodiversity is threatened and that culture collections in these countries are not secure, which is another reason to pay attention to the contributions from these countries. Many developing countries are working on bioenergy projects that rely on microorganisms. Examples include a new species of alga in Thailand, a Patagonian tree fungus that seems to expel hydrogen gas, a biomass-degrading fungus from the Solomon Islands that was noticed because it ate through the canvas and other materials used by the U.S. Army when it was stationed there. That fungus was recently sequenced by the Department of Energy and found to have some very interesting genes. These countries desperately need new sources of fuel, so they are investing in biofuels. Unfortunately, they are getting biofuels by cutting down their rainforests, destroying their wetlands, and planting, for example, the oil palms that are now seen all over Indonesia and Borneo. This is not a sustainable practice. The countries thus are very interested in finding alternative ways of producing biofuels, and micro-organisms may be an important resource in this regard. With respect to the semi-commons idea that we are discussing at this meeting, there are two relevant models at NIH that you might want to consider. One of them is from the National Cancer Institute (NCI). For 20 years NCI has supported contracts to collect natural materials (plants and marine organisms) from countries all over the world. It uses a simple letter of collection. The collections are targeted specifically for discovering agents active against cancer and HIV, so they are very focused. The materials are completely managed by the U.S. government. NCI uses a standard memorandum of 44 Presentation slides available at: isionSelectionMethod=Latest. 129

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understanding and a material transfer agreement (MTA) with a commercialization trigger—that is, the benefits must be renegotiated if something becomes a lead compound and moves on to commercialization. Because of its focused nature and the fact that the materials are completely controlled by the government, I do not think this is the most adaptable model. The second model is represented by the International Cooperative Biodiversity Groups (ICBGs). These are investigator-initiated grants for biodiversity collections and biodiscovery research. The materials are managed by the grantees. However, each Group has very high transaction costs in the form of unique memoranda of understanding and material transfer agreements. The ICBG program, which began in 1993, has a philosophy that is very similar to the Convention on Biological Diversity (CBD), although those two efforts were parallel and independent of each other. We started with three interdependent observations. First, we knew at the beginning of the ICBG program that nature is a rich source for new drugs. For example, about half of the FDA-approved drugs currently on the market are based directly or indirectly on natural products. Second, discovering natural products requires accessing biodiversity, but biodiversity is threatened globally. Finally, we felt that countries should own their own biodiversity and that they should receive some benefit from its use, which could in turn serve as incentives for the further preservation of biodiversity. Biodiversity might then become a sustainable source for future products from biodiscovery. The novelty of this program as it was originally conceived was that we would ask groups doing research in this field to address all of the goals in one integrated program; that is, biodiscovery, biodiversity conservation, and the development of models to provide appropriate benefits for access and use of biodiversity. It was thus a highly ambitious project. NIH’s charge was simply not broad enough to do this. We had a congressional mandate to do health discovery, but not to do biodiversity conservation or economic development. So we formed a funding consortium with three partners. Drug discovery was represented by NIH and included approximately nine Institutes and Centers at NIH with an interest in a broad array of therapeutic areas. The U.S. Agency for International Development (USAID), which had experience with development conservation projects, represented expertise and authority for providing economic benefits. Finally, the National Science Foundation had a mandate for biodiversity conservation and bioinventory. Over time, this funding consortium expanded further. There is a very high cost associated with sending a team to a remote rainforest. Furthermore, all natural materials potentially have multiple applications. When we take a leaf off a tree, we can test it for drug discovery, for use in bioenergy solutions, for agrochemical and animal health technologies, and for a variety of other purposes. So, the program has evolved over time to become even more complicated for the sponsors. USAID eventually dropped out because its funding schedule did not match everybody else’s. Since then, however, we have brought in the U.S. Department of Agriculture to support discovery of agrochemicals. The Department of Energy joined us last year. We work with Dan Drell, who is at this meeting, on bioenergy solutions. Our most recent partner is the National Oceanographic and Atmospheric Administration, which is interested in products from the seas and healthy oceans. The rationale for bringing the different partners together is severalfold. Not only is there some economy of 130

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scale, so it is more cost effective, but it also mitigates risk both for the sponsors and for the grantees because, if you are looking in multiple areas, it increases the probability you will find something. We have also found that it greatly increases the impact of the programs. It protects the resources for everybody in all of these areas. To make things even more complicated, however, in order to address these very diverse goals, the teams are very multidisciplinary and multisectoral. There is always a partnership between academic institutions in the United States and academic or research institutions in the developing country. Most ICBGs are public–private partnerships, so there is usually a pharmaceutical, agrochemical, or biotechnological company involved as well. There are usually government entities from the foreign country involved, and there are often nongovernmental organizations and local communities too. If you wish to access something from a coral reef, for example, and a village owns that coral reef, you are going to have to negotiate with that village. Consequently, there are very diverse sets of stakeholders with different cultures and goals for the project all working together in one consortium. We have now worked in 18 countries, which are listed in Table 18–1. Plant-based Collections: Microbial Collections: Chile Costa Rica* Argentina Panama Mexico Fiji* Vietnam Uzbekistan Laos Tajikistan Nigeria Kyrgyzstan Cameroon Madagascar Peru Philippines* Indonesia* Papua New Guinea * Bioenergy collections TABLE 18–1 Countries Involved in International Cooperative Biodiversity Groups When we started in 1993, the initial projects focused on plants, particularly tropical plants. In the third round of five-year awards, which was begun six years ago, we encouraged participants to obtain microbial and marine collections, and now all of our Groups are doing that. As you can see from the list in Table 18–1, the countries involved vary widely in terms of the size of their economies and their scientific sophistication. Because we just began bioenergy collections in 2008, we have less data on these projects, but they look very promising. There is a variety of transaction costs involved in getting this program to work and in successfully using and benefiting from these microbial collections. We provide 131

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guidance, but we do not provide any standard format for access and benefit sharing agreements or for obtaining prior informed consent. One of the most important things to make clear in negotiating agreements or in the process of obtaining prior informed consent is that royalties are not going to be the major benefit of programs of this sort. This was a mistake made in the early days of the CBD. The countries thought they were going to make billions of dollars from new blockbuster drugs, so they decided to protect their biodiversity based on that expected return, and when that did not materialize there was a huge backlash and disillusionment. So now, as part of the prior informed consent process, we encourage grantees to talk about not only the intended uses for the materials but also the probability of various outcomes. That transparency has made this whole thing work. In addition to access and benefit-sharing agreements, there are permits, MTAs, and other government documents, depending on the particular country we are working in. The laws vary from country to country, and sometimes it is very difficult to discover what those laws are. In some cases, a country may have no laws at all governing the use of these bioresources. Each country should have a person who is the main CBD contact, but often that person is not very informed about what the country’s laws are, so it may be necessary to do a great deal of investigation to discover how to be compliant with the laws. Shifting regulatory landscapes add to the complexity of the situation. In the middle of a project—as happened to us recently—a president can suddenly decide to change the existing law or add new laws, and our project then grinds to a halt because we no longer can export organisms and we may have to rework everything to comply with the new law. The scientists we work with serve as advisors to these governments, however, and when they say we cannot go forward with a particular project under a new law, there is some push and pull in that. In this case, the ICBG project itself was the reason that the new law was eventually reversed. The political landscape may also shift. For example, there have been two separate coups in Madagascar during our project there. In Fiji, the president was about to issue a major policy decree based on the work of the ICBG that would have been a major victory for biodiversity conservation when the government was overthrown. You have to deal with these sorts of events. The easiest way to negotiate these agreements is to do them as academic research agreements and not worry initially about the possibility of commercial products being generated from them, because that is a low probability. The agreement should, however, include a commercialization trigger—a statement that if some discovery does move towards a commercialization pathway, that will trigger additional good faith discussions on how to pay for the use of that discovery. On average, it has taken the ICBGs one to two years to negotiate these agreements, which must be finalized before any collections can leave the country. Generally, some work can be done during that period, but that is a long time to wait before being able to take the materials to outside labs. We did speed up the process this past round by announcing that anyone who did not have an agreement within a year would lose the funding. Everybody got their agreements within a year. The ICBGs have set precedents for access and benefit-sharing, and they have been used as case studies for the CBD. Perhaps the most important thing is that they have allowed on-the-ground experiments. It is easy to sit in a room with a number of lawyers and try to discuss what should be a benefit. What seems to be the most effective 132

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approach, however, is for people to go out and negotiate these agreements, institute them, and then see the reaction of the stakeholders and get that feedback. It serves as an experiment in benefit-sharing. We have also contributed to national policy in a number of countries—indeed, most of the countries in which we have worked—either directly or indirectly. Often the scientists in these countries who are working with us are the ones writing the laws. There are two basic models for how access to microbial resources is provided. The first is that the microbes cannot leave the country at all. This is the case in Madagascar, for example. By law, anything that is self-replicating cannot leave the country, so it is necessary to import the technology into the country, which forces us to engage in some sort of technology transfer, a significant benefit for the country. In some cases, the samples are allowed to leave the provider country if they are accompanied by a scientist from the country of origin. Indonesia, for example, has come up with an agreement recently that is intended to ensure technology transfer, but there is some wiggle room allowing samples to be removed in cases when it is not feasible to do the analysis in the country—if they are accompanied by an Indonesian scientist. The second model allows isolated and identified microbial cultures to leave the country only under the terms negotiated, for the purposes described, and to the parties designated. There is no third party access or release of information without prior agreement. The chain of custody must be documented and usually there is a time limit after which the samples have to be destroyed or returned unless the terms are renegotiated. All of the access and benefit-sharing agreements negotiated by the ICBGs have two types of benefits. The more important of the two are the low-risk, near-term benefits. There is a low probability that a blockbuster drug will come out of the work done under any given agreement, so there have to be some immediate and concrete benefits for the countries. The most important benefit is the building of research capacity in the countries. This is what the countries want and what they need in order to exploit their own resources. We provide that in the form of training, technology transfer, and some infrastructure, particularly equipment. The countries also have the benefit of participating in a research collaboration, which seems to attract other research collaborations, so there is a leveraging effect. Furthermore, when we work with local communities, there are local economic benefits. These take a variety of forms, from creating jobs to helping the development of micro- enterprises. The high-risk, long-term benefits relate to the commercialization of a product developed from something discovered under one of these agreements. If that happens, the benefits may include such things as milestone payments or royalties. Many of these funds are contributed to a trust fund dedicated to conserving biodiversity for the country overall. Often the pharmaceutical and biotech companies participating in the project contribute to that trust fund, so the country is getting something in the bank. In addition to financial payments and the protection of biodiversity, the other major long-term benefit that arises from these agreements is the development of products that increase the public health or provide benefits to society. With regard to the participation of these countries in microbial semi-commons, several issues should be considered. The first question that arises is: Whose benefit? It is often presented as a global good for everyone to have access to microbial cultures—and it is—but it is a very unequal playing field. Most of these countries do not have the capacity 133

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to make use of their own resources. What they really need is the scientific capacity to explore those biological resources so that they are better able to take advantage of them. It is a problem if these countries see themselves mainly as providers and not as users of the commons. If that is the case, then the open-access premise of mutual benefit does not apply—these countries cannot benefit as much from their own resources or the resources of the commons as other countries. In this case, perhaps the act of provision should be balanced by a nonequivalent benefit. I would suggest that these countries should receive a combination of both near- term and long-term benefits. The long-term benefits would be commercialization- triggered benefits; if something goes on to commercialization that is derived from their collections, there will be further discussion about appropriate compensation. The immediate benefit could involve helping these countries build their scientific capabilities. For example, there is a demonstration project underway, called the Global Biological Research Center Network, which involves 15 countries, a number of them developing countries. The countries with established biological resource centers (BRCs) are paired with developing countries that would like to develop BRCs to help them build capacity for their culture collections. This is something that I think the countries would really welcome. I have looked at their culture collections. It gives me nightmares. We spend a great deal of money helping them collect the samples, and they are put in refrigerators without backup generators, without any backups anywhere. The cultures are not being maintained adequately, but these countries would like to maintain the cultures and bring them up to recognized international standards. Indeed, if they are not brought up to a minimum standard, the samples are not going to be of much use anyway, since they will not be at the appropriate quality level. If you want these countries to participate, therefore, it will be necessary to help them build the capacity so that they are able to participate in a meaningful way and they would see that as a very significant benefit. A second set of issues is: Who owns biodiversity? Who has the authority to provide cultures? It is not going to be the individual researcher in Indonesia. Permission will have to go through the government, because the government owns those resources and that is how they view it. Similarly, who is going to receive the benefits? One could argue that the benefits should flow to everyone from the villager who let you work in his coral reef all the way up to the people who collected the organisms, isolated them, did the chemistry, and so on. In the near term, monetary benefits from use of microbial cultures could go into building a national resource center, as in the ICBG Trust Fund model. For the long term, it will be more problematic to identify the appropriate stakeholders and each country will have to answer these questions for themselves. Intellectual property rights also raise a number of questions. For example, in the ICBGs, we have very rich associated datasets for the microbial collections. For each micro-organism, we can tell you the associated ecology, what else was collected with it, its partial or complete DNA sequence, and so on. It has gone through a lot of bioassays. We know the chemical composition. The countries may be able to offer a very comprehensive dataset for some of their collection. How does that translate into valuing the materials? Is one standard benefit enough? Finally, to use some benefit system as an incentive to develop and as a means to support a BRC, it is necessary to track and acknowledge the origin of materials. I believe 134

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that documented chains of custody will be critical. For these countries to take part, they will need to feel secure. A shared microbial commons also represents a community of trust. However, this community of trust is extremely tenuous. It has been violated many times. There have been some major bio-piracy cases, and these transgressions are happening all the time on a smaller scale, so it will be necessary to build this community of trust slowly and incrementally. Before these countries can participate, they are going to have to develop the quality controls and quality of materials that the community expects, and in the process of doing that, they will begin to become engaged. That, at least, is what we have seen so far. Finally, it is necessary for the global community to weigh these transaction costs against the need to protect the resource because these transaction costs may be the incentive for conserving the resource. I will close with a success story from our Panama ICBG, which has been ongoing for over 10 years. The collaborators in Panama started with very little scientific infrastructure for natural products discovery, but over the past decade we have supported the development of a first-class parasite drug discovery lab and a first-class chemistry facility there, and we have provided funding for the first nuclear magnetic resonance machine in the country. They have sent about 30 students on to get higher degrees as a result of this program. The Panama ICBG research consortium had to pick a conservation project and some kind of benefits scheme because we require those things as part of the award. So during the last round, which started five years ago, they decided to focus on a fairly large island called Coiba Island, which is along the country’s Pacific coast. Because Coiba had housed a penal facility for decades, it had never been developed, so it had beautiful primary forest and was surrounded by almost untouched coral reefs and mangrove swamps. It is a gorgeous area. As soon as the penal colony closed, the bidding started. A number of developers wanted to move in immediately and start building condos and vacation homes. The ICBG group decided that its conservation project would be to protect the island and get it UNESCO World Heritage status so that it could not be violated. This was really ambitious. It was just a small group of researchers.. Nonetheless, this is what they set out to do. They did all of their collections on Coiba Island and the surrounding reefs. They trained their students there. When they did an inventory of the entire island, they found many endemic species that were new to science. They also discovered many very promising molecules. They assembled all their data and took it to the Panamanian Parliament. They said, “You cannot develop this island. This is an incredible resource. Look at all of these new species we found. They are nowhere else in the world. Look at all these incredible potential drugs we found. This is going to be a gold mine for this country because once you get World Heritage status, the tourists will start coming. You can start building a real industry. It will be very prestigious and will boost the economy of the entire country.” And the Parliament agreed. First they set up a national park there with all the appropriate controls and legal enforcement. Then they went to UNESCO to ask that it be made a World Heritage site. UNESCO told them it was not big enough, even though it was already huge. So they went back to Parliament, and Parliament doubled its size to set aside a very large marine area surrounding Coiba Island. They went back to UNESCO, and two years ago UNESCO designated it as a World Heritage site. The outcome of this innovative, integrated approach was something that was much larger than the sum of its parts. 135

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