icabr presentation falck zepeda et al june 2016 abrev
TRANSCRIPT
Program for Biosafety Systems – http://pbs.ifpri.info/
“Developing Efficient Regulations: Implications of the Cost of Compliance and
Regulatory Delays for Genome Editing Techniques (GETs)”
Jose Falck-Zepeda, Patricia Zambrano, David Spielman, Mark Rosegrant and Judy
ChambersEnvironment and Production Technology Division, IFPRI
Paper presented at the 20th ICABR CONFERENCE TRANSFORMING THE
BIOECONOMY: BEHAVIOR, INNOVATION AND SCIENCE; , Ravello (Amalfi
Coast – Italy), June 26–29, 2016; Oscar Niemeyer Auditorium
Program for Biosafety Systems – http://pbs.ifpri.info/
Why GETs?
• Improved delivery efficiency
• Reduced time to delivery
• Ability to combine multiple traits efficiently
• Potential to increase yield potential
• Expanded trait modification capacity
Technical paradigmatic change….
Program for Biosafety Systems – http://pbs.ifpri.info/
Broad research questions
1) Will GETs reduce R&D costs?
2) Will GETs reduce or eliminate regulatory and deployment costs? Time to complete regulatory processes?
3) Would a reduction in the cost of R&D be enough to compensate for potential market acceptance issues (if any)?
4) Would a reduction in the cost of R&D compensate even for potential regulatory costs?
5) Would this be an incentive for public sector and small private firms to invest in gene editing technologies for developing new products?
Program for Biosafety Systems – http://pbs.ifpri.info/
The U.S. National Academies of Science, Medicine and Engineering Report on GE Crops
• Examined the relevant literature (1000+ research and other publications)
• Held information-gathering meetings
• 3 meetings + 15 webinars = 80 presentations
• All presentations are archived on the study’s website
• Read more than 700 comments submitted by members of the public
Program for Biosafety Systems – http://pbs.ifpri.info/
Existing and prospect advanced biotechnologies
Techniques Examples Applications
Nuclear genome transformation
Agrobacterium mediated Gene gun mediated
Most commercially available technologies
Plastome transformation Not widely usedGene silencing techniques Antisense silencing FLAVR SAVR tomato delayed fruit ripening and enhanced fruit quality
RNA Interference(RNAi) Yellow/Golden mosaic virus resistant bean produced by EMBRAPA
Transformation methods that do not rely on tissue culture
Floral dip For example, certain members of the Brassicaceae family such as Arabidopsis thaliana and Camelina sativa can be transformed using the floral dip method (Clough and Bent, 1998; Liu et al., 2012) in which Agrobacterium tumefaciens delivers the transgene directly into the genome of egg cells, thereby permitting production of transgenic plants directly from seed. Used to avoid somaclonal variation
Genome editing Meganucleases Not widely usedZinc finger nucleases (ZFNs) Not used yet for commercial application
transcription activator-like effector nucleases (TALENs)
Not used yet for commercial application
Clustered regularly interspaced palindromic repeats (CRISPR)/Cas9 nuclease system
Release approvals for waxy corn and disease resistant mushrooms in the US
Artificial and synthethic chromosomes
Not used yet for commercial application
Targeted epigenetic modifications
Not used yet for commercial application
Source: Based on data presented in the NAS Report 2016
Program for Biosafety Systems – http://pbs.ifpri.info/
Potential regulatory pathways
• No regulation
• Same regulatory framework as GE crops
• Novel approach (i.e. the Canadian system)
• Stricter regulatory oversight as a result from the stricter application of the precautionary principle
Program for Biosafety Systems – http://pbs.ifpri.info/
Cost and regulatory delay scenariosTitle Scenario Rationale
Baseline => GEDs crops have the same regulatorytimeline and cost profile as GE crops
GEDs will be regulated as GE crops within the biosafety regulatory system as currently implemented. Option subject to regulatory risk, uncertainty and vagueness inherent with product regulation.
Scenario 1 => GEDs have a lower regulatory cost +shorter timeline
May be comparable to the novel based approaches such as the one in Canada. May also be associated with regulatory agency not
reviewing a GED application deemed not required as it is not within its purview. Greater clarity in terms of identifying regulatory pathway. If a product deemed novel then it is subject to regulation.
Scenario 2 => GEDs have a higher regulatory cost +longer timeline due to regulatory delays
Pursuing an even more stringent approach to regulation appealing to the precautionary approach as it is a “new” technique
Scenario 3 => GEDs gave the “same” cost + longertimeline to complete process due to
regulatory delays
Pure regulatory delay as related to longer time needed to complete a decision.
Program for Biosafety Systems – http://pbs.ifpri.info/
QI
Higher
cost
Lower
time
QII
Higher
cost
Higher
time
QIII
Lower
cost
Lower
time
QIV
Lower
cost
Higher
time
Time
Cost
Tb
CbB
S1
S2
S3
Program for Biosafety Systems – http://pbs.ifpri.info/
Timeline and estimated R&D and regulatory costs for a GE crop
Year Early
Discovery
Late
Discovery
Construct
optimisati
on
Commercial event
production &
selection
Introgression
breeding & wide
area testing
Regulatory
science
Registration
& Regulatory
affairs
R&D Total Regulatory science
+ Registration and
Regulatory Affairs
Total
1 15.9 0.0
2 13.9 0.0
3 8.8 0.0
4 10.4 0.0
5 14.4 4.2
6 8.8 4.6
7 12.8 4.6
8 8.0 6.0
9 8.0 3.2
10 0.0 3.2
11 0.0 3.2
12 0.0 3.2
13 0.0 3.2
Total 17.6 13.4 28.3 13.6 28.0 17.9 17.2 100.9 35.1
Source: Based upon Phillips McDougal 2011
Program for Biosafety Systems – http://pbs.ifpri.info/
Indicative Philippines IR rice case study protocol - based on Kikulwe et al. 2008;2012
• Use FAOSTAT data on yield and production from 1961-2014 to obtain estimates of the drift rate (α) and variance (σ2)
• Estimate the hurdle rate along with assumed values of the Discount rate (μ) of 0.12 and a Risk-free rate (r) of 0.04.
• Use farm level budgets compiled by PhilRice (2013) to estimate the Average Incremental Benefit from a GET insect resistant rice expressed in pesos per ha/year.
• Converted into US$ using an exchange rate of 44.53 pesos/$. • The average incremental benefit pursues a similar yield performance difference
than the one used in Bayer, Norton and Falck-Zepeda (2008) of 10%. In line with the same article we did not include a pesticide cost reduction in our estimations. This may be one potential source of underestimation in our projections.
• Use estimates for rice in the Philippines – Total number of farmers of 11,500,000– Total number of households of 18,539,769– Total area 4.5 million hectares planted to rice
• Estimate the Social Incremental Reversible Benefits (SIRBs) and the Maximum Incremental Social Tolerable Irreversible Costs (MISTICs)
Program for Biosafety Systems – http://pbs.ifpri.info/
Estimates SIRBs for an insect resistant rice in the Philippines
Baseline S1 Lower regulatory cost (50%) & shorter time (5 years)
S2 Higher cost (50%) and longer time (5 years)
S3 Same cost and longer time (5 years)
Discount rate (μ) 0.12 0.12 0.12 0.12Risk-free rate(r) 0.04 0.04 0.04 0.04Hurdle rate 1.25 1.25 1.25 1.25
NPV (millions US$) 1,445 1,859 1,113 1,113
Average benefit per year (Millions US$)
130 168 100 100
Total NPV benefit per ha (US$/ha)
620 798 477 477
Average benefit per ha and year
56 72 43 43
Average per household/year
11 15 9 9
Average per farmer/year
7 9 5 5
Program for Biosafety Systems – http://pbs.ifpri.info/
Estimates MISTICs and NPV to investor for an insect resistant rice in the Philippines
Baseline S1 Lower regulatory cost (50%) & time (5 years)
S2 Higher cost (50%) and longer time (5 years)
S3 Same cost and longer time (5 years)
NPV (millions US$) 1,152 1,482 887 887 Average benefit per year (million US$)
104 134 80 80
Total NPV benefit per ha (US$)
494 636 381 381
Average benefit per ha and year(US$)
45 57 34 34
Average per household/year (US$)
9 12 7 7
Average per farmer/year (US$)
6 7 4 4
NPV (Millions US$) for an investor
699 937 507 516
Program for Biosafety Systems – http://pbs.ifpri.info/
Summary impacts
S1 Lower regulatory cost (50%) & time (5 years)
S2 Higher cost (50%) and longer time (5 years)
S3 Same cost and longer time (5 years)
Total NPV benefit per ha (US$)
29% -23% -23%
Average benefit per ha and year(US$) 27% -24% -24%
Average per household/year (US$) 33% -22% -22%
NPV (Millions US$) for an investor 34% -27% -26%
Program for Biosafety Systems – http://pbs.ifpri.info/
Benefits from Improvements in Regulatory Efficiency
• Reduced uncertainty
• Reduced cost of compliance
• Reduce possibility of rejecting useful technologies
• Increased innovation and possibility of products approved for commercialization
• Increased number and types of products adopted and used by farmers
• BUT…..
Program for Biosafety Systems – http://pbs.ifpri.info/
Can GET be an option for developing countries or even “pro-poor”?
• Strengths– Expedite – can accelerate R&D processes
– Portable – techniques can be used in different crops
– Versatile – can be used to address problems at different levels of the marketing chain
– Political will
• Limitations– More complex process
• Science
• Institutional arrangements (IP, PPPs, Business model for deployment)
• Biosafety requirements
– New paradigm => Knowledge intensive process
– Who will push the cart? Public vs. Private sector
– Political will
Program for Biosafety Systems – http://pbs.ifpri.info/
Will the private sector become dominant as in the case of GE crops?
• Private sector successful in organizing multi-disciplinary teams to deliver a project that will serve their clients
– Mandated holistic research (My way or the highway)
– Can the public sector learn some operational lessons from this experience…yes it can and it should!!
– EMBRAPA and the VR bean as one model
• The “producer centered” model of technology diffusion and the rise of the consumer
Program for Biosafety Systems – http://pbs.ifpri.info/
GE technology transfer: Insect resistant / Herbicide tolerant maize in Honduras
Seed innovator
Breeding/Agronomy
Capacity and R&D
Asgrow / Dekalb A5753
Gene innovator
Biotechnology Capacity and
R&D
Monsanto
MON810 & NK 603
Biosafety
analysis
Bt / RR maize hybrid
A5753BT/RR
Intellectual
Property
Farmers /
Households
+
Socio-Economic
Impact
Assessment?
Dir
ect
seed
tra
nsf
erUSA, South
Africa, Chile
Honduras
Seed SystemSustainable
livelihoods and
gender analysis
Public Private
Partnerships and
strategic alliances
Innovation System
Program for Biosafety Systems – http://pbs.ifpri.info/
Knowledge and information flows in biotechnology, biosafety and market systems
Smallholder
Farmers
Larger
Farmers
Farmer, Community
Organizations /
Coops
Market Supply Chain
Domestic
Consumption
User
Community
National
International
Community Information
Space
Multi-Stakeholder Leaning
Negotiated Action
Biosafety
Regulatory
Bodies
Ministries
Biotechnology
policies and
regulations
Government
Ministries
Codex
AlimentariusCartagena
Protocol
WTO
Treaties ?
Foreign
regulatory
policies
Foreign
regulatory
bodies
Import /
Export
Sustainable
Livelihoods
Levels
Labeling
Domain
Falck Zepeda, Maru and Komen, 2003
Program for Biosafety Systems – http://pbs.ifpri.info/
Policy Lessons
• GETs are exciting techniques that have the potential of improving potential yields of many crops
• Interesting option for developing countries
• No specific technical reasons why GETs need to be regulated unless they introduce novel trait – same as a mutation
• If GETs were to be regulated as GE crops it is unlikely they will be commercialized especially in those countries that have not commercialized
José Benjamin Falck-Zepeda
Senior Research FellowIFPRI
2033 K Street NWWashington, DC 20006-1002
Brief bio/pubs: http://www.ifpri.org/staffprofile/jose-falck-zepeda
Blog: http://socioeconomicbiosafety.wordpress.com/
Follow me on Twitter: @josefalck