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#685 - Trouble in the Garden, 02-Feb-2000

Wall Street investors lost confidence in agricultural
biotechnology during 1999.[1,2,3] Agricultural biotechnology is
by no means dead, but investors drove down stock prices of ag
biotech companies during 1999 in a stunning reversal for the
industry. The WALL STREET JOURNAL said Jan. 7, 2000, "With the
controversy over genetically modified foods spreading across the
globe and taking a toll on the stocks of companies with
agricultural-biotechnology businesses, it's hard to see those
companies as a good investment, even in the long term."[2]

Hardest hit was Monsanto, the St. Louis chemical giant that had
spent 5 years and billions of dollars morphing itself into a
"life sciences" company, betting its future on biotechnology in
pharmaceutical drugs and agricultural crops. As the WALL STREET
JOURNAL wrote December 21, 1999, "Billions of dollars later, that
concept of a unified 'life sciences' company -- using technology
to improve both medicines and foods -- has become an affliction
itself for Monsanto. The crop-biotechnology half of the program
has grown so controversial that Monsanto has agreed to a deal
that is likely not only to push biotech to the back burner, but
also to cost Monsanto its independence. And investors are
reacting harshly."[3]

Monsanto agreed late in 1999 to merge with Pharmacia & Upjohn,
Inc. and the combined company will be run not from St. Louis but
from Pharmacia headquarters in Peapack, New Jersey. Monsanto's ag
biotech business will be spun off into a separate company and as
much as 19.9% of it will be sold.

Two other leaders in ag biotech, the Swiss pharmaceutical giant
Novartis AG, and the Anglo-Swiss drug firm AstroZeneca PLC,
announced during 1999 that they will combine their ag biotech
divisions into one and sell it off, "effectively washing their
hands of crop biotechnology," the WALL STREET JOURNAL said.[3]

Thus by the end of 1999, ag biotech companies found themselves in
trouble, worldwide, for the first time. Here is a short list of
reasons why:

** A lawsuit against the U.S. Food and Drug Administration (FDA)
forced the release of government documents showing that FDA
scientists had expressed grave doubts about the safety of
genetically modified foods even as the agency was publicly
declaring such foods "substantially equivalent" to traditional
crops.[4] It seems clear from these documents that the scientific
integrity of the U.S. regulatory system has been compromised for
political purposes, to provide a "fast track" for the rapid,
large-scale introduction of genetically modified foods.

** The insurance industry has consistently refused to write
policies covering liability for harm caused by genetically
modified organisms. Steven Suppan, research director at the
Institute for Agriculture and Trade Policy (IATP) in Minneapolis,
said last June, "It is worth asking what kind of regulatory
system approves for commercialization a technology whose risks
are so undetermined that the products developed from the
technology have not been insur- ed? An intuitive response is that
the U.S. rejection of liability suggests that U.S. agribusiness
and the U.S. government have less confidence than is proclaimed
publicly in the safety of the products approved and in the
integrity of the product review process," Dr. Suppan said.[5]

** A growing body of literature has begun to show that
genetically modified crops are creating new kinds of
environmental problems for farmers, and that genetically modified
crops are exacerbating already-severe economic problems on
American farms.[6]

** Europeans and others overseas have continued to insist that
the safety of genetically modified foods has not been
sufficiently documented and that import of such foods must be
prohibited, or they must be labeled. The doubts expressed by FDA
scientists, and the growing list of economic and environmental
problems are likely to stiffen European resistance to
genetically-modified seeds, crops, and foods.

** It became apparent in 1999 that the public rationale for
promoting genetically modified foods -- that such foods would
"feed the world" -- was based on wishful thinking, not economics.
It is now clear that U.S. genetically modified crops are too
expensive to "feed the world."[6]

** The rationale for refusing to label genetically modified foods
came unraveled in 1999 as biotechnology companies began to
announce new crops with special traits (rice with increased
vitamin A, for example). For years, biotech companies, the U.S.
Department of Agriculture (USDA), U.S. Environmental Protection
Agency (EPA), and FDA have argued that labeling genetically
modified foods was impossible because it would require food
companies to segregate genetically modified crops from
conventional crops and it simply couldn't be done. All the crops
were mixed together in the grain elevator, so labeling would be
impossible, they said.

This silly and disingenuous argument evaporated in 1999. As soon
as biotech firms announced specialty foods created by genetic
engineering, the labeling problem miraculously disappeared.
Labeling is suddenly easy -- indeed, required -- because
consumer's can't be expected to pay premium prices for specialty
foods if those foods aren't clearly identifiable on the grocery

Polls have shown that more than 80% of American consumers want
genetically modified foods labeled as such. Now that labeling is
acknowledged as feasible, will the biotech industry, USDA, EPA,
and FDA bend to the public will and start labeling ALL
genetically modified foods? Not on your life. Government and
industry argue with one voice that labeling is not necessary
because genetically modified foods are "substantially equivalent"
to the conventional foods they have replaced. They even say
labeling would be "misleading" because it would imply that there
are differences between biotech foods and conventional foods.

Federal regulations governing biotech foods are founded on the
premise that there are no "material differences" between
genetically modified crops and conventional crops. This argument,
it turns out, was thoroughly discredited by FDA scientists before
the regulations were issued.

The FDA spent 1989-1992 developing regulations governing
genetically modified foods for humans and feed for animals. This
was back when President Bush and Vice-President Quayle were
advocating "regulatory relief" for industry.

FDA's rules -- which were announced by Mr. Quayle in 1992 --allow a
biotech company like Monsanto or DuPont to decide for
itself whether its food products are "generally recognized as
safe" (GRAS). If a company decides that its new genetically
modified corn or soybean or potato or wheat is "generally
recognized as safe" then no safety testing is required before the
products are introduced into the food supply. FDA said these
rules -- like all their rules -- are based on "sound science."

However, during 1999 a lawsuit filed by the Alliance for
Bio-Integrity in Fairfield, Iowa, forced the FDA to release some
44,000 pages of internal documents for the first time.[4] Among
them was a series of memos from FDA scientists commenting on the
FDA's proposed "substantially equivalent" policy for biotech

A key issue is whether "pleiotropic effects" will occur when new
genes are inserted into plants to give the plants desirable new
traits. Pleiotropy means that more than one change occurs in a
plant as a result of the new gene. For example, a gene that
allows a plant to grow better under drought conditions might also
make the entire plant grow smaller. The smaller size would be an
unexpected "pleiotropic" effect.

FDA regulations assume that pleiotropic effects will not occur
when new genes are inserted into conventional foods such as corn
or potatoes or wheat or soybeans. Therefore, FDA says,
genetically modified crops are "substantially equivalent" to
conventional crops.

Internal memos make it abundantly clear that FDA's scientific
staff believes pleiotropic effects will occur when new genes are
inserted into food crops. [In the following quotations, words
inside square brackets have been added for clarity but words
inside normal parentheses were in the original memos.--P.M.]

Commenting on the FDA's proposed biotech regulations in early
1992, Louis Pribyl, an FDA microbiologist, wrote March 6, 1992,
"It reads very pro-industry, especially in the area of unintended
effects.... This is industry's pet idea, namely that there are no
unintended effects that will raise the FDA's level of concern.
But time and time again, there is no data to backup their
contention, while the scientific literature does contain many
examples of naturally occurring pleiotropic effects. When the
introduction of genes into [a] plant's genome randomly occurs, as
is the case with the current [genetic modification] technology
(but not traditional breeding), it seems apparent that many
pleiotropic effects will occur," Dr. Pribyl wrote. "Many of these
effects might not be seen by the breeder [meaning Monsanto or
DuPont or other biotech firm] because of the more or less similar
growing conditions in the limited trials that are performed.
Until more of these experimental plants have a wider
environmental distribution, it would be premature for FDA to
summarily dismiss pleiotropy as is done here," Dr. Pribyl wrote.

On the same subject, a memo from the Division of Contaminants
Chemistry within FDA's Division of Food Chemistry and Technology
said November 1, 1991, "Pleiotropic effects occur in genetically
engineered plants... at frequencies up to 30%. Most of these
effects can be managed by the subsequent breeding and selection
procedures. Nevertheless, some undesirable effects such as
increased levels of known naturally occurring toxicants,
appearance of new, not previously identified toxicants, increased
capability of concentrating toxic substances from the environment
(e.g., pesticides or heavy metals), and undesirable alterations
in the levels of nutrients may escape breeders' attention unless
genetically engineered plants are evaluated specifically for
these changes. Such evaluations should be performed on a
case-by-case basis, i.e., every transformant should be evaluated
before it enters the marketplace."

Instead of heeding the concerns of its scientific staff, FDA
issued biotech food rules that assume no pleiotropic effects will
occur, therefore no safety testing is required. All biotech foods
are assumed to be safe. The stage was thus set for confidence in
biotech foods to plummet as soon as word leaked out that the
scientific underpinnings of the regulatory system had been

To be continued next week.

--Peter Montague (National Writers Union, UAW Local 1981/AFL-CIO)


[1] I am indebted to Steven Suppan, research director at the
Institute for Agriculture and Trade Policy (IATP) in Minneapolis,
who provided me with several brief, thoughtful summaries of the
state of agricultural biotechnology. Contact: ssuppan@iatp.org.
Telephone (612) 870-3413.

[2] Christina Cheddar, "Tales of the Tape: Seed Co. May Yet Reap
What They Sow," WALL STREET JOURNAL January 7, 2000, pg. unknown.

[3] Scott Kilman and Thomas M. Burton, "Biotech Backlash is
Battering Plan Shapiro Thought Was Enlightened," WALL STREET
JOURNAL December 21, 1999, pg.A1.

[4] The FDA documents are available at
http://www.bio-integrity.org/list.html. And see Marian Burros,
"Documents Show Officials Disagreed on Altered Foods," NEW YORK
TIMES December 1, 1999, pg. A15.

[5] Steven Suppan, unpublished paper, "National Summit on the
Hazards of Genetically Engineered Foods, June 17, 1999, Capitol
Hilton Hotel, Washington, D.C. 2 pgs.

[6] Some of this literature is summarized in Charles M. Benbrook,
"World Food System Challenges and Opportunities: GMOs,
Biodiversity, and Lessons From America's Heartland," unpublished
paper presented January 27, 1999, at University of Illinois.
Available in PDF format at http://www.pmac.net/IWFS.pdf .

Descriptor terms: biotechnology; monsanto; dupont; novartis;
pharmacia; astrozeneca; agriculture; hunger; fda; regulation;
labeling; alliance for biointegrity; pleiotropy;