Government Regulations Biotechnology

Governments impose regulations to avert the costs associated with mitigating adverse effects expected to result from the use of the technology. But, developing regulations is difficult when a technology is new and the risks associated with it are uncertain or poorly understood. Because there have been no examples of adverse effects caused by biotechnology, projecting potential hazards rests on extrapolations from problems that have arisen using naturally occurring organisms. The consensus among scientists is that risks associated with genetically engineered organisms are similar to those associated with nonengineered organisms or organisms genetically modified by traditional methods, and that they may be assessed in the same way. Where similar technologies have been used extensively, past experience can be an important guide for risk assessment.

Many countries, in addition to the United States, have adapted existing laws and institutions to accommodate advances in biotechnology. However, it is no simple matter to base scientifically sound biotechnology regulation on legislation written for other purposes. The differences in approach from nation to nation, particularly through their effects on investment and innovation, will influence the ability of the United States to remain competitive in biotechnology on the international scene.

Industrial Policy Biotechnology

Industrial policy is the deliberate attempt by a government to influence the level and composition of a nation’s industrial output. Industrial policies can be implemented through measures such as allocation of R&D funds, subsidies, tax incentives, industry regulation, protection of intellectual property, and trade actions. Industrial policies in the United States are complex, fragmented, continually evolving, and rarely targeted comprehensively at a specific industry. There is no industrial policy pertaining to biotechnology per se, but rather, a series of policies formulated by various agencies to encourage growth, innovation, and capital formation in various hightechnology industries. And, just as there is no biotechnology policy in the United States, biotechnology companies tend to behave not as an industry but rather, as agrichemical firms, diagnostic firms, or human therapeutic firms. Biotechnology companies have been built on a unique system of financing, but they largely confront the same regulatory, intellectual property, and trade policies faced by other U.S. high-technology firms. There may be a need for the Federal bureaucracy to fine-tune its policies as biotechnology moves through the system, but, to date, Federal agencies have not seen the need to revolutionize their practices for biotechnology.

Environmental Applications Biotechnology

Although biotechnology has several potential environmental applications-including pollution control, crop enhancement, pest control, mining, and microbial enhanced oil recovery (MEOR)— commercial activity to date is minuscule compared to other industrial sectors. Bioremediation, efforts to use biotechnology for waste cleanup, has received public attention recently because of the use of naturally occurring micro-organisms in oil-spill cleanups. The U.S. bioremediation industry includes more than 130 firms, but it is the focus of few DBCs. Nevertheless, though small, the size of the commercial bioremediation sector in the United States far exceeds activity in other nations. Although bioremediation offers several advantages over more conventional waste treatment technologies, several factors hinder its widespread use.

Relatively little is known about the effects of micro-organisms in various ecosystems. Research data are not disseminated as well as research in other industrial sectors because of limited Federal funding of basic research and the proprietary nature of business relationships under which bioremediation is most often used. Regulations provide a market for bioremediation by dictating what must be cleaned up, how clean it must be, and which cleanup methods may be used; but regulations also hinder commercial development, due to their sheer volume and lack of standards governing biological waste treatment.

Chemical Industry Biotechnology

The chemical industry is one of the largest manufacturing industries in the United States and Europe. Currently, over 50,000 chemicals and formulations are produced in the United States. The consumption of chemical products by industry gives these products a degree of anonymity as they usually reach consumers in altered forms or as parts of other goods.

Biotechnology has a limited, though varied, role in chemical production. The production of some chemicals now produced by fermentation, such as amino acids and industrial enzymes, may be improved using biotechnology. Similarly, biotechnology can be used to produce enzymes with altered characteristics (e.g., greater” stability in harsh solvents or greater heat resistance). In many instances, biotechnology products will probably be developed and introduced by major firms without the fanfare that has accompanied other biotechnology developments and, like much of chemical production, will remain unknown to those outside the industry.

In the very long run, biotechnology may have a major impact in shifting the production of fuel and bulk chemicals away from reliance on nonrenewable resources (e.g., oil) and toward renewable resources (e.g., biomass). However, current work in this field appears to be limited, in part, because the international price of oil has remained too low to encourage investment in alternatives, and, in part, because the chemical industry throughout the world has restructured during the last 10 years, moving away from bulk chemical production and toward the production of specialty chemicals, pharmaceuticals, and agricultural products.