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 Opportunities And Limitations For
Biotechnology Innovation in Brazil
Authored By

Luiz A.B. de Castro

ABCP –Agriculture Biotechnology Consultoria and Projects

SHIS QI 28 Conjunto 16, Chacara Dom BoscoLagoSul,
Brazilia DF, Brazil

Co-Authors

Carlos A.L. Neri

Technology and Innovation Agency of the Ministry of Science and
Technology in Brazil, Brazil

Carlos Bloch Junior

Mass Spectrometry Laboratory at CENARGEN - EMBRAPA
Empresa Brazileira de Pesquisa Agropecuária, Centro Nacional de
Pesquisa de Recursos Genéticos e Biotecnologia,Parque Estação
BiológicaAsa Norte70910-900 - Brazilia, DF – Brazil

Manoel O.de Moraes Filho

Universidade Federal do Ceará, Faculdade de Medicina, Unidade de
Farmacologia Clínica Departamento de Fisiologia e Farmacologia.
Rua Coronel Nunes de Melo, 1127, Rodolfo Teófilo 60430-270 -
Fortaleza, CE, Brazil
Bentham Science Publishers Bentham Science Publishers Bentham Science Publishers
Executive Suite Y - 2 P.O. Box 446 P.O. Box 294
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Sharjah, U.A.E. USA THE NETHERLANDS
[email protected] [email protected] [email protected]

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 CONTENTS

Biography i

Preface iii

Foreword v

Introduction vii

CHAPTERS

1. Biotechnology and its Applications in Brazil 3

2. Biopharmaceuticals from Brazil 29

3. Partnerships to Build Biotechnology 67

Concluding Remarks 109

Index 111
 i

BIOGRAPHY

Luiz Antonio Barreto de Castro, is an Agronomist with a hybrid background. He

worked many years in plant breeding before moving to plant physiology and plant
molecular biology. He is PhD from UCDavis in Plant Physiology and has a Pos
Doc in Plant Molecular Biology from Goldberg`s lab in UCLA. For sixteen years
he worked as a professor in Agronomy at the Federal Rural University of Rio de
Janeiro. He established Plant Biotechnology in Brazil at CENARGEN in
EMBRAPA early in the eighties where he worked for twenty five years as a
scientist. His laboratory cloned and expressed the first plant gene in Brazil in
1991. He was the president of the Biosafety Commission in Brazil for three years
from 1996 to 1998 and came back to be the Chief General of CENARGEN/
EMBRAPA during the years of 2000 to 2003 to establish the Genomic/Proteomic
Program of EMBRAPA now in operation. He became a member of the Brazilian
Academy of Science in 2003. He published extensively in the areas of Plant
Breeding, Seed and Plant Physiology and Plant Molecular Biology and was
responsible for the first Brazilian patents in plant genetic engineering. In addition
to his academic back ground he is an expert in the areas of plant patents, plant
breeding rights, biodiversity and biosafety having contributed directly for the
design and approval of all related laws in Brazil in these subjects He has served
the best institutions nationally and internationally as a consultant in these areas.
For eight years he served the Ministry of Science and Technology as Science
National Secretary. During this period representing the Brazilian Government he
successfully negotiated with the World Bank important Multidisciplinary
Programs such as The Pilot Program for the Conservation of the Amazonian Rain
Forest and The Brazilian Science & Technology Reform Program known in Brazil
as PADCT - Science and Technology Development Support Program the largest
Science and Technology Multidisciplinary Funding Program ever executed by the
Brazilian Federal Government. He was from 1991 to 1999 the Executive
Secretary for this Program, worked for the Getulio Vargas Foundation. Back to
the Ministry of Science and Technology as a Research and Development
Secretary in 2005 he established the Northeastern Biotechnology Network –
RENORBIO, Bioamazonia and Centro Oeste, Graduate and R&D Networks. He
became the National Secretary for the Ministry of Science and Technology again
ii

in August of 2005 in the area of Policies in Scientific Research and Development

position he occupied till January of 2011. He served as the Technical Director of
the IBA –Brazilian Cotton Institute until June of 2011 and since July as the
Director of R&D and Innovation of União Quimica – Farmaceutica Nacional S/A
till August of 2012. He served since 2006 untill 2011 in the Technical Committee
of the World Bank for the Uganda Scientific Millenium Program and completed
this task in September of 2012. He was honored during the 4th Brazilian
Biotechnology Congress and he is now the President of the SBBIOTEC –
Brazilian Biotechnology Society.
 iii

PREFACE

Efforts to develop Biotechnology in Brazil exceed three decades. Almost

coincident with the advent of the recombinant DNA technology which became
publically known early in the seventies when Herbert Boyer expressed the insulin
gene in E. coli. A couple of scientists in Brazil repeated this experience almost at
the same time and the interest for the area came to the agenda of a public
company called EMBRAPA founded in the seventies to work with agricultural
research in Brazil. The author built in EMBRAPA since 1980 a platform to
develop plant genetic engineering training young scientists in areas such as plant
cell and molecular biology to be able to incorporate this nascent technology to the
plant breeding efforts of EMBRAPA. This work took place at CENARGEN –The
National Center for Genetic Resources and Biotechnology the most prominent
institution working in this area for the last four decades. The public perception in
Brazil and many other countries was turned against this new technology for
political reasons and when the first engineered soybean resistant to glyphosate
was released commercially a campaign against transgenic plants prevented the
application of this technology in agriculture for almost a decade in Brazil. The
world however adopted recombinant DNA technology in the pharmaceutical area
and most products utilized internationally by the public in this industry including
Brazil are genetically engineered. Brazil tried to follow the growth of Biology
commercially and introduced in consonance to TRIPS legislations to protect
intellectually the applications of biology in genetics since the mid nineties. That
was necessary but not sufficient. We had to deal with a rampant inflation for
decades and had to train a number of scientists for the same time as well as
investing institutionally in the area of Biotechnology. This eBook tells this story
and is written now because apparently after Brazil became an emerging power
financially it seems there are more opportunities now than before. So, this eBook
is intended for those who want to know some of the history of Biotechnology in
Brazil, since its inception, hopefully to conclude positively about the power of
this technology and the opportunities we have in our hands now, that were not in
the context of this now called life science innovation area when we started these
efforts at CENARGEN in 1980. Brazil may become a relevant actor in this area
internationally taking advantage of some circumstances here that are not available
iv

in other countries, particularly our biodiversity. We make explicit indicators to

support this thesis but the eBook describes adjustments that must be made to
assure the success of our investments particularly to the laws – the regulatory
framework, that are at the base of this crescent international market. Finally, I
would like to acknowledge the Nature Biotechnology blog, Trade Secrets, which
initially published several discussions found in this eBook. The collection of
those original blog posts can be found here: http://blogs.nature.com/tradesecrets/
author/lbarreto.

CONFLICT OF INTEREST

The author(s) confirm that this eBook content has no conflict of interest.

ACKNOWLEDGEMENTS

Declared none.

Luiz A.B. de Castro

ABCP –Agriculture Biotechnology Consultoria and Projects
SHIS QI 28 Conjunto 16
Chacara Dom BoscoLagoSul
Brasilia DF
Brazil
E-mail: [email protected]
 v

FOREWORD

For implementing the Millennium Development Goals and Rio + 20 Sustainable

Development Goals, our world will need more than better governance and
political goodwill. We need a more sustainable and high yielding agriculture, a
more sustainable industry based not only on petroleum as raw material, but on
agriculture and city waste and specialized "industrial" crops. We also need an
affordable pharmaceutical industry, that can react efficiently and rapidly against
the different emerging infectious agents. The ongoing population increase, under
nourishment and urbanization result in extreme poverty and inequalities,
enhancing social unrest and leading occasionally to instability and political
uncertainty. All this raises the risk that evolving pathogens represent distinct
epidemiological threats. How to cope with these challenges? What is needed for
that?

Our present world can no longer function without an accelerated contribution of

science and technology. In the life science sector, tremendous progress was made
in the last 40 years: Successively gene cloning, manual and later automatized high
performance sequencing of DNA and RNA, novel mass spectroscopy approaches
for sequencing proteins and their modifications, identification of secondary
metabolites and precursors of the biological macromolecules have generated a
mind boggling amount of data, and through parallel advances in information
technology and fast computing have helped to build a solid amount of novel
fundamental knowledge.

To apply this knowledge and convince the financial and economic world to help
develop the appropriate start-ups is the challenge of today’s biotechnology sector.
Europe and now also the US have made solid political declarations that the future
of our quality of life, including the environment, depends on the development of a
performing "Bio-economy". But to be successful one will need a dynamic and
innovative interaction between the established Bio-industries, active in the whole
value chain of agriculture, forestry, fermentation, the pharmaceutical industry and
the emerging pollution remediation industries with the research institutes and
universities contributing to the fundamental life Sciences research. At present few
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vi

governments have the capacity to stimulate the right interactions. An important

exception is Brazil, and in particular for the agriculture and forestry related
activities. EMBRAPA, established also nearly 40 years ago, is an example of how
creative fundamental research can be well linked with field work in all aspects of
agronomy, agriculture and husbandry. The close cooperation between breeders
and molecular biologists, soil scientists and plant pathologists makes it a model
for scale up and replication around the world. A more international presence of
EMBRAPA can stimulate many countries to join the race for developing the
necessary life sciences industries.

The career of Luiz Antonio Barreto de Castro also spans exactly these 40 years.
During his studies and postdoc periods in California, he realized the power of
gene cloning. He was able to convince EMBRAPA to join this research and he
actively did so by becoming the first director of CENARGEN. Through his vision
and initiatives, opportunities were created for new generation researchers who
contributed to the development of Brazil’s biotechnology capacity.

It is therefore a great pleasure to congratulate him on the initiative to

communicate his thoughts on the priorities for further biotechnology actions.

Professor Marc van Montagu

President European Federation of Biotechnology (EFB)
President Public Research Regulation Initiative
Institute for Plant Biotechnology Outreach – Flemish Inter University Institute
Biotechnology (IPBO/VIB)
Gent University
Belgium
 vii

INTRODUCTION

This eBook has three chapters. In chapter 1, the context of Biotechnology in

Brazil is analyzed as it concerns with two major areas of application of the
technology: Agriculture and the Pharmaceutical industry. The eBook deals mostly
with Genetic Engineering a major technology that was developed and applied in
Brazil in the last three decades, both by public as well as by private large
corporations. The eBook does not deal with genomic derived technologies and
products (perhaps few examples) since they were not yet developed in Brazil,
although in literature there are plenty of examples about the applications of this
area particularly in the United States. In each area opportunities and limitations
are described emphasizing mainly the regulatory system in Brazil particularly as
they apply to GM crops, and its restrictive aspects as a limitation element in said
context but also the opportunities related to each area particularly as Brazil is
growing to become a relevant power in the global economy, the sixth economy
today.

The Chapter 2 deals with opportunities for Innovation related to the area of
Biopharmaceuticals where Brazil may have important opportunities due to its
biodiversity still far from being developed to products, to add value to these
products and return dividends that can be used to assure the sustainability of the
biomes where the products are derived from. In the Second Section, some of the
aspects analyzed in the first Section may be brought back in an effort to
demonstrate particularly how the legal aspects that will circumvent the growth of
products as Biopharmaceuticals will be in the agenda of those that decide to invest
in the area to promote the growth of the Pharmaceutical industry in Brazil.

In Chapter 3, strategies are described to build Biotechnology particularly

partnerships as a mechanism to bring the best actors and institutions together. So,
this eBook is intended mostly for investors, to present an initial, sometimes crude
and real view, of an area that has acquired important space financially in the
world and still reserves possibilities to grow in Brazil.
 Send Orders of Reprints at [email protected]

Opportunities and Limitations for Biotechnology Innovation in Brazil, 2013, 3-28 3

CHAPTER 1
Biotechnology and its Applications in Brazil

Abstract: The Biotechnology Industry in Brazil is of the size of some State sectors in
the US. The one that is closest to the size of the Biotechnology in Brazil is Georgia.
Eighty five% of the Biotechnology companies in Brazil have up to fifty employees and
revenues of slightly above 1 million US $ /annually. Eighty% of these companies are
located in three states: São Paulo, Minas Gerais and Rio de Janeiro (Br Biotech 2011).
The academic Biotechnology sector in Brazil is however relevant. Forty eighty
Graduate Courses are recognized by the Agency specialized to deal with Education
in Brazil: CAPESCoordenação de Aperfeiçoamento de Pessoal de Nivel Superior
(CAPES 2013).

Keywords: Biotechnology, Agriculture, Pharmaceutical Industry, Regulatory

System, Biopharmaceuticals, Biological Diversity Convention, Public Perception
of GM plants, The Patent system in Brazil, Plant Variety Protection Law,
Partnering of biotech, SELIC rate.

BIOTECHNOLOGY – THE BACKGROUND

Biotechnology started early in the Seventies when Herbert Boyer transferred a

gene found in the human genome and coding for insulin to E. coli, a bacteria that
expressed the gene producing insulin. In order to succeed with this experiment the
area of molecular biology had experienced previous advances that allowed genes
to be cloned in so called vectors, at that time mostly circular DNA molecules
called plasmids, using restriction enzymes that could tailor these vectors putting
side by side promoter sequences and the genes themselves to be expressed in a
given organism. The advances of the so called recombinant DNA technology
came to a halt when a Conference in San Diego – The Asilomar Conference (Berg
et al. 1975) required biosafety rules to make sure that the nascent technology
would not cause any hazard to humans particularly considering the possibility of
using virus as vectors to express genes in humans: gene therapy. This possibility
was extremely distant in the seventies but Asilomar stimulated NIH to propose
Biosafety rules that were gradually adopted globally and one can verify today that
the recombinant DNA was developed without causing any harm except in very

Luiz A.B. de Castro

All rights reserved-© 2013 Bentham Science Publishers
4 Opportunities and Limitations for Biotechnology Innovation in Brazil Luiz Antonio Barreto de Castro

few events related precisely to the issue that preoccupied the scientists in
Asilomar more than three decades ago.

The term Biotechnology came later and the area demonstrated the potential to
affect particularly Health and Agriculture. Advancements in health had been made
fast and today most of the pharmaceutical industry is based on genetic
engineering and recombinant molecules. Agriculture took longer and started in the
mid eighties. The first genetically modified plant was produced by Luis Herrera
Estrella in Brussels in 1982 (Estrella et al. 1983) in the laboratory of Marc
Montagu. Today, however most plants utilized in the industrial agriculture are
genetically modified. Brazil had almost no Biotechnology development early in
the 80’s and even today the area faces difficulties to grow, less in agriculture than
in the pharmaceutical industry for reasons we will try to demonstrate. It is
possible to define opportunities for the area of pharmaceuticals, considering
particularly the possibility to internalize the best technologies available in the
world, private internal investments that result from the fact that Brazil is today the
sixth economic power globally and, very important, if restrictive regulatory laws
that apply to the field can be adjusted. In this document, we will not face all the
regulatory issues but select a few in particular: the patent law and the access to the
Brazilian biodiversity.

OPPORTUNITIES OF BIOTECHNOLOGY AS IT APPLIES TO

AGRICULTURE

Agrosciences

When Herbert Boyer expressed an insulin gene in bacteria mentioned previously,

I was a freshman PhD student studying plant physiology at UC-Davis, with a
fellowship provided by EMBRAPA, that had been created a couple of years
earlier. That achievement alerted us that the world was going to change. Genetic
engineering was the most important science discovery, after the genetic code
itself. Brazil produces today over 180 million tons of grain in 50 million hectares
and yields are moving up. The Country multiplied grain production by four in the
last four decades. It can again double that figure without destroying the Amazon
or the Cerrado and is building policies to assure that a sustainable agriculture will
Biotechnology and its Applications Opportunities and Limitations for Biotechnology Innovation in Brazil 5

be the strategy, after adopting a Forest Code. The Code does not satisfy the
expectations of most actors involved but it will be an advance to prevent further
forest destruction and particularly protect water reservoirs and rivers.

Agriculture in Brazil made a significant move forward when in 1965, Brazil

established its first law to regulate the commercialization of seeds. The law
exercised a very simple concept: what is inside the bag should be in the label
EMBRAPA. The Brazilian Enterprise for Agricultural Research mentioned before
was created in the mid seventies. Biotechnology started at EMBRAPA early in the
80’s at a research Center called CENARGEN in Brasilia and I was given the
task to build Agricultural Biotechnology at EMBRAPA from the very beginning.
No plants had been genetically engineered in 1980 as previously mentioned.
Cenargen became later the National Research Center for Genetic Resources and
Biotechnology. Brazil started training plant cell, molecular, and developmental
biologists at that Center. Without those developments, coupled to work of plant
breeders to be mentioned later the seed industry would not have flourished in
Brazil, and this industry was essential for biotech crops developed later.

In 1985, the best Brazilian scientists visited Europe to discuss biotech, we had
nothing to offer. Twenty-five years later, when we came back to the same
institutions, everything had been modified. Now we can express any gene of any
organism in bacteria, yeast, human cells, plants and animals, and plant molecular
biologists team up with plant breeders to create plants for the tropics. When the
necessary genes are not available, we settle partnerships with gene companies.
Also, EMBRAPA established a Foundation Seed Program, inspired by the US
system, and this offers transgenic seeds to companies, big and small. This means
that even small companies can compete if the quality of the seed is good.
Scientists in Brazil in the future hope to make grasses that fix nitrogen, so that
poor people do not have to buy urea to use as chemical fertilizer, which pollutes
the soil and the water. EMBRAPA scientists released in 2012 the first green bean
engineered to become resistant to the Golden Mosaic Virus, using RNA
interference technology (Bonfim et al. 2007). Few countries made use of the gene
revolution, particularly as related to developmental biology, to advance
agriculture as we did in Brazil. We verified in addition that genes do not have to
6 Opportunities and Limitations for Biotechnology Innovation in Brazil Luiz Antonio Barreto de Castro

be transferred as transgenics require, because genes are common to all species.

The strategy is to release genes, such as the anti-fungic dermaseptin peptides
found in frogs and in plants, to work as anti-fungic peptides in soybeans. This
concept is called intragenic by Carlos Bloch (Brand J.D., et al. 2012), a scientist
working at EMBRAPA the largest institution of its kind, with offices in the five
continents.

That’s solid progress, but the question is, why did it take so long to see biotech
crops released in Brazil? We had a biosafety law in operation since 1995, but
literally lost 10 years disputing and at the end were restricted by the judiciary in
Brazil, which took sides and made political decisions against science and
scientists. After 2005 everything changed. A new biosafety law stimulated
the combination of tropical genetics and biotech so much that Brazil is second
only to the US in biotech crop production. We will come back to this issue later.
We have in fact few plants entirely engineered in Brazil, but Brazilian
corporations take advantage of our breeders’ expertise and release the best crops
for all Brazilian biomes. Still, the gene revolution has not resolved a few
important things.

We still have not produced in the world plants that can defend themselves against
bacteria and fungi. This technology is available in the US and at the Fraunhofer
Institute in Germany. Few institutions have reliable genes to generate plants
resistant to drought and to soil aluminum toxicity that together affects more than
80% of tropical soils. There is work to do, but Brazil can make the gene
revolution work in the same direction as the green revolution did decades ago, by
the hands of Norman Borlaug who left us few years ago, with more powerful
science tools available.

THE ORDEAL OF GENETICALLY MODIFIED (GM) ANIMALS IN THE

US (DE CASTRO, L.A.B., 2013)

The NY Times in April of this year questioned ongoing projects in the US under
the regulatory advisement of FDA for the extremely long time that the Agency is
taking to approve GM animals. The article considering the seventeen years that
were necessary to AcquaBounty to approve its GM salmon in FDA (and has not
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