SUMMARY¹

Over the past 50 years, the integration of engineering principles and advances in computing and information sciences has transformed the life sciences and biotechnology. The ability to read genetic code, edit an organism’s genome, and create organisms with entirely synthetic genomes are just a few of the breakthroughs that have changed the way research is done and the types of products that can be created. The economic activity related to the life sciences research enterprise is referred to conceptually as the bioeconomy. Examples of bioeconomy products include chemicals made though biosynthetic pathways rather than solely chemical synthesis (such as 1,3-propanediol), microorganisms that act as environmental biosensors, fabrics made from biosynthetic spider silk, and novel foods and food additives made from yeast or bacteria. The U.S. bioeconomy provides a means of developing new and innovative products and achieving such benefits as lower carbon consumption and improved health care solutions. It also has opened new avenues for innovation, job creation, and economic growth. Along with its promise, however, the bioeconomy brings vulnerabilities and concerns.

Given the speed and importance of advances in the bioeconomy, the Office of the Director of National Intelligence asked the National Academies of Sciences, Engineering, and Medicine to convene a committee of experts to assess the scope of the U.S. bioeconomy and determine how to assess its economic value. The committee was also asked to identify

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¹ This summary does not include reference citations. References for the information herein are provided in the full report.

potential economic and national security risks facing the bioeconomy and associated policy gaps, consider cybersecurity solutions for protecting data and other outputs of the bioeconomy, and determine mechanisms for tracking future advances and developments (see Box S-1 for the committee’s complete Statement of Task). In responding to this request, this report provides an estimate for the value of the bioeconomy based on the committee’s analysis. Additionally, the committee was tasked not with conducting a horizon scan of the bioeconomy, but with presenting and discussing methodologies that could be used to accomplish that task.

DEFINING THE U.S. BIOECONOMY

The U.S. bioeconomy is a broad and diverse enterprise that spans many scientific disciplines and sectors and includes a wide and dynamic range of stakeholders. Basic life sciences research often begins with public investment in research and training of scientists working in academic and federal research settings or within the research and development (R&D) departments of corporations. In addition to these traditional stakeholders, many large research institutions have spurred the development of local innovation ecosystems bringing in a wider range of stakeholders, including citizen science laboratories, incubator spaces, start-up companies, small businesses, and partnerships with larger industrial companies, as well as the network of providers of materials, tools, and expertise. The computing and information sciences, including machine learning, are dramatically accelerating the reach of the bioeconomy by making it possible to analyze and use biological data in new ways. Engineering principles and approaches are enabling automation and high-throughput experimentation, further accelerating the growth of the bioeconomy. Box S-2 provides further detail on how life sciences, biotechnology, engineering, and computing and information sciences serve as drivers of the bioeconomy. Currently, there is no consensus definition of a bioeconomy, resulting in differing interpretations of what activities are within the scope of a bioeconomy. A fundamental challenge is that bioeconomy activities span many sectors and scientific disciplines, are typically focused around a country’s economic priorities, and combine subsets of traditional sectors measured in systems of national income accounts. Therefore, attempts to define and develop performance metrics for the bioeconomy and bioeconomy strategies invariably start with decisions about which economic activities to include as direct bioeconomy components.

Given the significant advances that have occurred since the National Bioeconomy Blueprint first articulated a U.S. definition in 2012, a new, comprehensive definition of the U.S. bioeconomy would enable the U.S. government to better assess the bioeconomy’s current state and develop

strategies for supporting and safeguarding its continued growth. Such a definition could also guide the metrics and data collection efforts needed to track the bioeconomy’s growth, conduct economic assessments, and enable policy makers to keep abreast of advances with the potential to pose new national or economic security challenges. Recognizing that a definition needs to be flexible enough to allow for the future inclusion of new developments, the committee developed a definition that does not limit the scope of the bioeconomy to particular sectors, technologies, or processes.

Recommendation 1: For purposes of demarcating the scope and reach of the U.S. bioeconomy and establishing a uniform framework for valuing the bioeconomy and its assets, the U.S. government should adopt the following definition of the U.S. bioeconomy:

The U.S. bioeconomy is economic activity that is driven by research and innovation in the life sciences and biotechnology, and that is enabled by technological advances in engineering and in computing and information sciences.

This definition encompasses all products, processes, and services that interact with or are built specifically for “research and innovation in the life sciences and biotechnology.” It is intended to be flexible to anticipate the inclusion of new advances and applications within the life sciences and all of biotechnology. Additionally, the committee’s definition references the impacts other disciplines have had on the life sciences. This definition thus fully embraces the convergence of many different scientific and engineering principles and domains with the life sciences. The transdisciplinary nature of the bioeconomy is key to its success and growth, enabling it to spread into economic sectors traditionally considered independent of the life sciences. Figure S-1 serves as a conceptual map of the U.S. bioeconomy.

MEASURING THE U.S. BIOECONOMY

Being able to adequately assess the economic contribution of the bioeconomy to the larger U.S. economy would raise awareness of the importance of the bioeconomy and the need to monitor and safeguard it. A full assessment of the inputs and outputs of the bioeconomy could also enable future analysis of how investment in basic research is tied to productivity, thus enabling better tracking of the outcomes of public investments. This enhanced tracking could also provide a means of understanding growing areas of the bioeconomy and potentially setting growth targets. Thus, better metrics for bioeconomy growth could serve as indicators of the health

of the sector, allow for an assessment of the impact of policy changes on the economic potential of the bioeconomy (or its subsectors), and help identify areas worth protecting from a security standpoint.

Based on the committee’s calculations and available data, in 2016 the bioeconomy accounted for about 5.1 percent of U.S. gross domestic product (GDP). In dollar terms, this represents $959.2 billion.

In conducting this analysis, however, the committee found that many factors make it difficult to measure the contribution of the bioeconomy to the overall economy. As noted above, definitions of the bioeconomy that specify what it encompasses vary substantially; the bioeconomy is tied to both science and commercialization, which leads to divergent approaches for assessing its value; and data on the bioeconomy have substantial gaps.

Concepts used to value the bioeconomy present additional challenges. Social welfare analysis, which attempts to quantify benefits to producers and consumers, is a particularly demanding approach for valuing a sector as diffuse as the bioeconomy. In theory, one could value the bioeconomy as the sum of the private values or value added of all firms active in the

sector. In practice, however, this is difficult, as many of the firms that operate in this sector are diversified, meaning their activities span a number of different areas, and it is difficult to isolate the bioeconomy-specific aspects of such firms.

In addition, existing data collection mechanisms for measuring economic activity are insufficient to monitor the bioeconomy holistically. This is due in part to the use of new biobased pathways to create products previously manufactured in sectors completely dissociated from biology.

In light of these impediments, the committee determined that a targeted and specialized framework for analyzing the value of the bioeconomy is needed (see Box S-3). The primary domains, or segments, of the

bioeconomy—agricultural, bioindustrial, and biomedical—are considered first as the major categories of activity encompassed by the bioeconomy definition presented above. However, when moving from a conceptual map based on scientific domains toward an economic mapping of the activities included in the bioeconomy, the groupings change to account for the current economic classification system. Thus, the committee needed to determine the subset of the primary segments for which economic activity data are captured. The following six segments are taken as an approximation of the bioeconomy, as best as can be determined from the available data, and recognizing that they incompletely capture the bioeconomy as the committee has defined it:

• genetically modified crops/products;
• biobased industrial materials (e.g., biobased chemicals and plastics, biofuels, agricultural feedstocks);
• biopharmaceuticals and biologics and other pharmaceuticals;
• biotechnology consumer products (e.g., genetic testing services);
• biotechnology R&D business services, including laboratory testing (kits), and purchased equipment services (e.g., sequencing services); and
• design of biological data-driven patient health care solutions, that is, precision medicine inputs (exclusive of patient care services per se and drugs counted elsewhere).

The committee offers the following recommendations to help expand and enhance data collection efforts so as to facilitate future valuations of the bioeconomy.

Recommendation 2: The U.S. Department of Commerce and the U.S. National Science Board should expand and enhance data collection efforts relevant to the economic contribution of the U.S. bioeconomy as defined by this committee.

Recommendation 2-1: The U.S. Department of Commerce and other relevant agencies and entities involved in the collection of U.S. economic data should expand their collection and analysis of bioeconomic data. The U.S. Department of Commerce should obtain input from partners in science agencies and from nongovernmental bioeconomy stakeholders to supplement and guide these efforts.

Recommendation 2-2: The existing North American Industry Classification System (NAICS) and North American Product Classification System (NAPCS) codes should be revised to more accurately

capture and track commercial activity and investments related to the biological sciences and track the growth of individual segments of the bioeconomy (e.g., biological production of chemicals and materials). In addition, the U.S. Department of Commerce’s Office of Technology Evaluation should undertake a study aimed at richer characterization of the permeation of biologically based products, processes, and services in the U.S. economy. Such a study would greatly inform revisions of the NAICS and NAPCS codes. Additionally, the U.S. Census Bureau should refine and regularly collect comprehensive statistics on bioeconomic activities.

Recommendation 2-3: The Bureau of Economic Analysis of the U.S. Department of Commerce should lead the development of bioeconomy satellite accounts linked to central national accounts. These satellite accounts should include databases of biological information as assets and over time be expanded to include environmental and health benefits attributable to the bioeconomy.

Recommendation 2-4: The U.S. National Science Board should direct the U.S. National Science Foundation to undertake new data collection efforts and analyses of innovation in the bioeconomy for the Science and Engineering Indicators report so as to better characterize and capture the depth and breadth of the bioeconomy, with an emphasis on identifying indicators that provide insight into U.S. leadership and competitiveness.

STRATEGIES FOR SAFEGUARDING THE U.S. BIOECONOMY

A history of strong and sustained U.S. government investment in the life sciences, in computing and information sciences, and in engineering has powered the development of today’s bioeconomy. Current U.S. leadership in this area will be challenged, however, as other countries invest in their bioeconomies at increasing rates. Falling behind in the application of computing and information sciences in the life sciences, in particular, could disrupt U.S. leadership in the increasingly global, data-driven bioeconomy. To retain the United States’ world leadership position, strategies will be needed both to address risks to and from the U.S. bioeconomy and to ensure that it is supported and optimized for growth.

Risks to and from the U.S. bioeconomy identified by the committee in response to its Statement of Task include (1) risks that would harm the bioeconomy’s continued growth or hamper the innovative ecosystem within which it currently operates; (2) risks from theft of, corruption of, asymmetries in, or constraints on access to intellectual property or key

bioeconomy information that would harm the U.S. bioeconomy, such as by conferring a competitive advantage on another party; and (3) risks from the misuse of bioeconomy outputs or entities.

Establishing Leadership and a Strategy for the U.S. Bioeconomy

While the committee recognizes that all of the stakeholders within the bioeconomy have a role to play, leadership and strategic direction are needed. Given the breadth of the bioeconomy across the many sectors discussed throughout this report, it is not surprising that life sciences research is distributed across many agencies and departments of the U.S. government. Moreover, no single agency has primary responsibility for the vitality of the biotechnology industry, or that of the greater bioeconomy. This disaggregated distribution poses a significant challenge for large-scale coordination, particularly when there is no clear candidate agency to take leadership. Each agency and department has a defined mission and associated scientific domain; therefore, no government agency has the mandate to monitor and assess the U.S. bioeconomy holistically, let alone determine a strategy for promoting and protecting it. In addition to hindering coordination, this distributed network of science agencies poses a challenge for comprehensively measuring the bioeconomy, as well as establishing a holistic horizon-scanning process to identify emerging developments in science and technology that could raise new issues or require new policy related to the bioeconomy. Given the lack of an obvious lead government agency for the bioeconomy, the committee concluded that a mechanism through which science, economic, and security agencies can bridge the current gaps in communication and coordination is needed.

Recommendation 3: The Executive Office of the President should establish a government-wide strategic coordinating body tasked with safeguarding and realizing the potential of the U.S. bioeconomy. To be successful, this coordinating body should be presided over by senior White House leadership, with representation from science, economic, regulatory, and security agencies. It should be responsible for relevant foresight activities and informed by input from a diverse range of relevant external stakeholders.

Recommendation 3-1: The coordinating body should develop, adopt, and then regularly update a living strategy with goals for sustaining and growing the U.S. bioeconomy. This strategy should be informed by an ongoing, formal horizon-scanning process within

each of the relevant science agencies, as well as by input from industry, nongovernmental organizations, and academia. Additionally, through this strategy, the coordinating body should identify and raise awareness of means through which the U.S. government can advance the bioeconomy, including such existing means as government procurement of biobased products.

Elements of a strategy for safeguarding and meeting the challenges that face the U.S. bioeconomy are detailed below.

Funding and Sustaining the Bioeconomy Research Enterprise

The U.S. bioeconomy relies on a robust and well-funded research enterprise that seeds innovation and supports a technically skilled and diverse workforce. Insufficient support for fundamental research will erode the United States’ ability to produce breakthrough scientific results or achieve incremental learning that can also have direct economic application. Ultimately, this inadequate support will also erode the nation’s ability to develop and recruit the world’s best research talent, including domestic talent, particularly in competition with other countries that are investing heavily in their own bioeconomies.

Public investments in science and engineering research have played a foundational role in driving America’s research enterprise. These investments have built the university research and education system that continually produces more doctoral graduates relative to any other country. Currently, the United States remains among the world’s leaders in public investment in the biological sciences, but erosion in support for government investment is a concern that needs to be addressed. Analysis of past and current investments suggests that the rate of federal investment in this realm has become stagnant, while other countries are increasing their investments.

Recommendation 4: To maintain U.S. competitiveness and leadership within the global bioeconomy, the U.S. government should prioritize investment in basic biological science, engineering, and computing and information sciences. In addition, talent development, at all levels, to support these research areas should be a high priority for future public investment.

Building and Sustaining a Skilled Workforce

Insufficient federal funding for U.S. universities and bioeconomy training programs has the potential to diminish the ability to produce and

retain a skilled technical workforce. Increased federal support for science, technology, engineering, and mathematics (STEM) education and partnerships between community colleges and industry aimed at growing a technically skilled workforce could create employment opportunities in U.S. regions whose traditional employment opportunities may have changed. The development of biotechnology capabilities in rural areas and investments in training programs and facilities in those areas could enable new opportunities for those communities while growing the bioeconomy.

In addition to the importance of training a domestic bioeconomy workforce, the United States has historically benefited from the ability to attract students and scientists from around the world to its universities. International students constitute a significant fraction of the enrollments at U.S. colleges and universities, particularly in STEM disciplines at the graduate level, and foreign-born employees form a substantial component of the U.S. STEM research workforce. These researchers have contributed immensely to the vibrant research enterprise on which the nation currently depends. However, recent changes in visa policy and investigations into and new policies regarding researchers with potential ties to foreign governments, talent programs, and funding also have the potential to discourage talented researchers from around the world from coming to the United States or even collaborating with U.S.-based scientists.

Recommendation 4-1: The U.S. government should continue to support policies that attract and retain scientists from around the world who can contribute to the U.S. bioeconomy, recognizing that open academic engagement has been strongly beneficial to the U.S. scientific and technological enterprise, even as it inherently offers potential benefits to other countries as well. Policies intended to mitigate any economic and security risks posed by foreign researchers in U.S. research institutions should be formulated by U.S. security, science, and mission agencies working closely together, and through ongoing engagement with a group of recognized scientific leaders. Having this group able to be fully briefed on the threat environment will greatly facilitate these discussions, since access to classified, proprietary, or other nonpublic information may be needed.

Addressing Intellectual Property Threats

In addition to harms done to the U.S. bioeconomy by the nation’s failure to take action to promote and support it, the bioeconomy is vulnerable to harm as a result of unfair or illegitimate actions of others, such as the theft of intellectual property. The U.S. bioeconomy has historically benefited from participation in an open, global, and collaborative scientific

environment that relies on the academic integrity of individuals and the willingness to adhere to research norms and values. Some federal officials have become increasingly concerned that the openness of the U.S. scientific enterprise puts its integrity and competitiveness at risk.

Safeguarding the U.S. bioeconomy while protecting innovation and growth could be facilitated by developing a more thorough understanding of the mechanisms by which the open conduct of and participation in fundamental scientific research drives proprietary innovation by entrepreneurs, both within the United States and among scientific and economic competitors, and conversely, of how restrictions on openness may affect the scientific research environment. Policy makers will have to strive for a balance that maximizes the benefits of scientific openness while protecting U.S. economic and security interests from countries that would exploit that openness unfairly.

Securing Value Chains and Examining Foreign Investments

The U.S. bioeconomy needs to be able to sustain itself by securing the value chains that fuel it. The continued development of biological routes to the production of previously non-biobased products will continue to disrupt existing value chains as the bioeconomy continues to permeate into new sectors. However, disruption of or risks to critical parts of bioeconomy value chains, such as supply shortages, interruptions in transport, or reliance on single sources, represent important risks to the nation. Reliance on single sources is particularly important if the source is based overseas and thus subject to changes in political relationships or other factors beyond U.S. control. Key components of bioeconomy value chains, key capabilities, and key sources of supply that are critical to the U.S. bioeconomy remain to be identified, as do mechanisms by which access to these assets can be ensured.

The transitional space where research is too applied for university-level development and yet still too risky to justify investment by commercial application represents an opportunity for venture capital to help start-up companies thrive. However, the source of venture capital funding for these early- to midstage developers may require more scrutiny, particularly given the increased trend of foreign investment in U.S. bioeconomy companies and start-ups. Examples exist of investments by nondomestic parties, either private capital or state backed, in U.S. bioeconomy businesses—both large, successful companies and smaller companies and start-ups—that were made with the goal of acquiring intellectual property.

The Committee on Foreign Investment in the United States (CFIUS) is responsible for reviewing potential foreign investments in and purchases

of U.S. companies. In August 2018, the Foreign Investment Risk Review and Modernization Act was signed into law, expanding CFIUS’s purview. Given the specialized nature of the bioeconomy, the committee determined that CFIUS will likely require additional subject-matter expertise to adequately assess the implications of foreign investments in U.S. bioeconomy entities.

Recommendation 5: The U.S. government should convene representatives from its science and economic agencies who can access relevant classified information to provide security agencies with subject-matter expertise so as to (1) identify aspects of bioeconomy global value chains that are vital to U.S. interests and to which access must be ensured, and (2) assist the Committee on Foreign Investment in the United States in assessing the national security implications of foreign transactions involving the U.S. bioeconomy.

Prioritizing Cybersecurity and Information Sharing

Life sciences research is driven by the collection and analysis of large amounts of data that are often generated through the use of automated and network-connected instruments. The ability to process such data is increasingly enabled by high-throughput computational processing power and information exchange and storage capacity. Inadequate cybersecurity practices and protections expose the bioeconomy to significant new risks associated with these vast stores of data and networked automated instruments.

While large companies tend to be aware of traditional cyber concerns and have information technology infrastructures that provide protection, smaller companies and academic institutions may not always be aware that they are targets for cyber intrusions. Therefore, the committee concludes that all stakeholders (companies of all sizes, academic institutions, government agencies, and others) need to adopt best practices in cybersecurity in order to create an organizational culture that promotes and values cybersecurity. Adoption of these best practices could be accomplished in a number of different ways, such as with training for all researchers within the bioeconomy to increase awareness of cybersecurity threats and vulnerabilities; adoption of the National Institute of Standards and Technology’s Cybersecurity Framework (which can be adapted for a wide range of organization sizes and types); and for some organizations, the appointment of chief information security officers.

Researchers receiving federal funding are often mandated to share their data in public databases, thereby expanding these vital databases rapidly. However, the potential for redundancy, inaccuracy, and even

conflicting entries poses a significant problem that is growing with the continued deluge of data. Attempts to merge, curate, and validate databases and redundant entries have demonstrated the considerable effort required; however, the potential net benefit for research is immense.

The bioeconomy relies on the use of open-source software, which means the software and its source code are openly available to anyone. However, the software industry has learned that making code open-source does little or nothing to guarantee its quality, robustness, and security. Open-source software introduces the potential for misuse, for example, if a malicious actor were to purposefully introduce a vulnerability into source code that enabled unauthorized access by third parties. These concerns could potentially be mitigated by establishing a more formal repository of open-source software for the bioeconomy, a formal regime for controlling changes to source code, a testing regimen for any changes to the code, and restrictions on who can make changes. Programs and incentives could be established to improve relevant software. Participation in an information-sharing group could additionally enable bioeconomy stakeholders to share experiences in detecting, mitigating, and preventing cyber intrusions, as they have done for many infrastructure sectors.

The following recommendations could help improve cybersecurity and information-sharing practices.

Recommendation 6: All bioeconomy stakeholders should adopt best practices for securing information systems (including those storing information, intellectual property, private-proprietary information, and public and private databases) from digital intrusion, exfiltration, or manipulation.

Recommendation 7: To protect the value and utility of databases of biological information, U.S. science funding agencies should invest in the modernization, curation, and integrity of such databases.

Recommendation 8: Bioeconomy stakeholders should pursue membership in one or more relevant Information Sharing and Analysis Centers or Information Sharing and Analysis Organizations, or consider creating a new sector-based information sharing organization for members of the bioeconomy. The Cybersecurity and Infrastructure Security Agency within the U.S. Department of Homeland Security should convene bioeconomy stakeholders to build awareness about relevant models for sharing information on cyberthreats. Those convened should consider whether an active repository is needed to host

and maintain key bioeconomy-related open-source software, algorithm components, and datasets.

OPPORTUNITIES FOR INTERNATIONAL ENGAGEMENT

The U.S. bioeconomy exists in the broader context of a global bioeconomy. Science is a global enterprise, and there is immense value to be gained from participating in a scientific enterprise that enables and embraces the free flow of ideas and discussion, the wide dissemination of published results, and collaboration across disciplines and borders. The benefits of such a system are available to all of the participants. Moreover, future challenges are going to be global in nature and will require a coordinated, global response. This will entail partnering with others who are actively growing and investing in their own bioeconomies, especially those who are likewise committed to open science, open economic development, and responsible research and innovation. However, while it is essential that the United States continue its role in international collaborations and play an active role in the global bioeconomy, uneven trade practices, a lack of reciprocity regarding sample- and data-sharing practices, and even regulatory regimes that make it more difficult for companies to bring their products to nondomestic markets still exist within this global enterprise. These practices, and others like them, have the potential to hinder the progress of research, the spread of innovative methods and ideas, and realization of the social and economic benefits of new products by undermining trust between collaborators.

Recommendation 9: Through such entities as the World Trade Organization and the Organisation for Economic Co-operation and Development, as well as through other bilateral and multilateral engagements, the U.S. government should work with other countries that are part of the global bioeconomy to foster communication and collaboration. The goals of such international cooperation would be to (1) drive economic growth, (2) reinforce governance mechanisms within a framework that respects international law and national sovereignty and security, and (3) create a level playing field.