Agricultural biotechnology: a growing market?

As instrument companies look to further diversify end-user markets for life science technologies beyond pharmaceutical applications, the agricultural biotech market might just be such a new opportunity. Defined here as the market for life science research, both commercial and public, related to plants, agribiotech has rapidly progressed in the last two decades, with recent developments setting the stage for even greater demand. The range of plant genomic applications and the complexity of plant genomes suggest that research in this area will expand. Bioinstrumentation techniques are well positioned to take advantage of this market, especially microarrays and other gene expression techniques, sequencing technologies, lab automation instruments and bioinformatics.

Despite setbacks in the last decade and ongoing controversy, the commercial agrobiotech sector continues to pursue the development of new products. Genetically modified (GM) crops are the most conspicuous component of this market. The market for GM seeds in 2001 was estimated at $3.67 billion by consultants Wood Mackenzie and made up primarily of soybean, cotton, canola and corn seeds. According to the US Dept. of Agriculture, biotech acreage in the US increased 13% in the spring of 2002 compared to 2001. The International Service for the Acquisition of Agri-Biotechnology Applications estimates that worldwide the number of acres devoted to biotech crops rose 19% in 2001, lead by the US and Argentina. In 2001, China tripled its acreage devoted to GM cotton and imported over 10 million tons of GM crops. Earlier this year, India approved a thee-year trial of Bt cotton, designed to resist the bollwarm, a cotton pest.

Monsanto, recently spun off by Pharmacia, leads the market for biotech crops, followed by Syngenta, Bayer CropScience, formed in 2001 by Bayer's purchase of Aventis CropScience, and DuPont/Pioneer Hi-Bred International. Monsanto, which is increasingly dependent on GM seeds to replace revenue from its herbicide business, allocated over $464 million to biotech and seeds research in 2001 and has pledged 10% of sales to R&D. The company boasts 20 basic science research centers and more than 15 alliances with biotech companies. Monsanto's Seed and Genomics business had sales of $1.7 billion for 2001.

Syngenta recorded approximately $159 million in revenue from GM seed sales in 2001, or 17% of total seed sales. Syngenta has biotech partnerships with Myriad Genetics, Diversa, Japan Tobacco and Maxygen. The company also published a draft sequence of the japonica subspecies of rice earlier this year. Monsanto also worked on a similar effort.

Initially, GM crop commercialization efforts have focused on farmer friendly traits such as herbicide and insect resistance, with drought resistant and yield stability traits are on the way. However, companies are also developing consumer friendly crops with enhanced nutrients, shelf life and flavor. Besides GM seeds for crops, other agribiotech products under development include GM feed, grain, plants, insects and animals.

The GM market no doubt poses some prominent risks, in particular regulatory, patent and consumer acceptance challenges. In order to address such problems, agribiotech research is seeking to understand fully how foreign genes affect a plant's chromosomes, so as to regulate introduction and have better control over their effects. Also, agribiotech opportunities lie beyond GM products. Genomics and proteomics research in this area are being used to improve plant breeding techniques through the use of genetic markers, which expedite breeding time and increase crop yields. Likewise, other functional genomics applications look to modify genetic structures, not to alter them, through the insertion of foreign genes. Such techniques can be applied food as well as to plant-based products ranging from plastics to antibodies.

However, the commercial sector is only one side of the agribiotech market. Academic and government funded plant research is also attracting greater interest and funding. The sequencing of the Arabidopsis thaliana genome last year and the indica subspecies of rice this year by international consortia were major steps forward for all plant science, as well as having important implications for genomics. Due to their relative small size and similarity to other plant genomes, these two genomes were sequenced in order to serve as models for studies of other plants. In addition, functional and comparative genomic studies from the studies will be applied to human research.

The sequencing of plant genomes has been expedited due to less expensive technology and new international resources. Among other publicly funded projects underway are the sequencing of the wheat, bean and banana genomes. International projects are also focused on EST (expressed sequence tags) sequencing of economically important plants, studies of plant metabolomics, and structural genomic analyses.

In the US, the National Science Foundation's Plant Genome Research Program has provided more than $215 million in research funding since 1998. Program Director Jane Silverthorne, Ph.D. told IBO the program has fostered the development of virtual research centers for interdisciplinary research and the availability of publicly available research tools such as the libraries at the BAC (Bacterial Artificial Chromosome) Resource Center at Clemson University and the University of Wisconsin's refinement of an optical mapping technique for genome mapping.

For instrument companies, such research draws upon the genomic technologies in which they specialize. "The technologies developed for the human genome project (in particular, automation) are now being applied to the agricultural and microbial markets," says Genetix' Chief Scientific Officer Julian Burke, Ph.D. "There is a big increase in demand as the DNA of these organisms is being sequenced." As it has done for pharmaceutical research, lab automation provides higher throughput at a lower cost with greater standardization. Bayer CropScience states that 30,000 compounds are tested daily using high-throughput screening at its Agricultural Center in Monehim, Germany. This year, Syngenta plans to test more than 250,000 novel chemicals and proteins. Also, the size and complexity of plant genomes strengthen the need for lab automation techniques.

"Some plant crops, there could be four copies of each gene, eight copies, and these multiple ploidy [the number of complete chromosome sets in a nucleus] levels pose a significant challenge to a lot of technologies," says Kellie Watson, director of Business Development at Pyrosequencing. Among Pyrosequencing's customers are DuPont Crop Protection, Pioneer Hi-Reed and the Scottish Crop Research Institute. According to Dr. Watson, the company's sequence, SNP and mutation analyses and allele frequency quantification techniques are well suited to the discovery and analysis of plant genes and traits due to their qualitative feature that addresses plant genome complexity. In agrobiotech, Dr. Watson says, the goal is to provide "the sequence analysis to identify specific types of crops ... differentiate crops in some cases where you have closely related crop species" and to study "microorganisms that might impact other crops or animals." She adds "you can use SNPs in these various genes and profile different crops and select out those that have all the traits you're interested in."

Also in demand are gene expression techniques, which must also tackle the issue of plant complexity. "It comes down to gene identification for crop improvement. It is significant that commercial gene chips now exist for the Arabidopsis genome, a plant model organism. It is likely that there will soon be a commercial rice chip as well. One problem for the plant companies is that the genomes of plants are very large, the genome of wheat being 10x greater than the human genome. Therefore the effort to identify these genes to make chips is much greater than that required for the human chips. In many cases gene arrays on nylon filters are used instead," says Dr. Burke

Genetix makes such microarraying technology and lab automation instruments. Driving this demand, as well as the demand for these techniques, according to Dr. Burke, is the need for validation and "to automate the process of plant tissue culture and other aspects of plant cell biology." While Dr. Burke sees growth in both the public and private sectors, he adds, "with a number of consolidations the number of large companies is decreasing, but this is being compensated for by an increasing sophistication." Dr. Watson agrees, "There has definitely been an increased demand for more refined and higher resolution technologies." But Dr. Burke also says the market raises some doubts about biotech's commitment as "there is simply more money in health," but is confident about public funding, "It appears that the public sector is gearing up relative to its historical spending [level]."

So far this year, microarray technologies appear to be especially in demand by agribiotech as measured by announcements by life science technology companies. In July, Agilent Technology announced that agricultural research company Orion Genomics had purchased gene express analysis technology, including its catalog Arabidopsis microarrays. In addition, Paradigm Genetics reported the development of a rice pathogen chip in cooperation with Agilent. In the spring of this year, Affymetrix announced a custom supply agreement with Monsanto for GeneChip technology and the completion of its latest GeneChip Arabidopsis array.

As with other life science markets, agribiotech applications also draw upon bioinformatic techniques. The complexity of plant genomes and resulting vast amount of public and private data have created a demand for bioinformatics that is being met by both public and private resources. Dr. Silverthorne told IBO that the Plant Genome Research Program has awarded grants for bioinformatics tools and is working on standards for plant research data. For private bioinformatics companies, agribiotech may present some of the difficulties they have encountered in the pharma market. But this market will help to provide such companies with a more diversified customer base. In January, bioinformatics firm Compugen established Compugen Agro-LEADS, a majority-owned subsidiary for agribiotech and plant genomics research and the development of GM seeds using its LEADS computational biology platform. Another bioinformatics company, which has announced sales into the agribiotech market, is LION bioscience, which recently extended its partnership with Paradigm Genetics.

The ever-changing business environment for agribiotech signals a market still very much under development. However, for instrument companies, the agribiotech market's demand for genomic and other life science technologies is very real as companies, both big and small, and government, academia and foundations worldwide turn to genomics as the next stage in agricultural research and product development. In addition, the wide range of research efforts and funding bodies signals a global commitment that is new end-users both private and public.

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