‘Cloned in China’: Beijing aims for biotech dominance

‘Cloned in China’: Beijing aims for biotech dominance

From cloned designer pets to GMO crops, China’s proactive biotech investments are paying off as the country becomes a major biotechnology player.

As China diversifies its economy away from semi-skilled manufacturing, it is seeking new growth sectors, such as aviation and renewable energy. Another exciting area for investors in China is the country’s rapidly growing biotech sector. This area is a priority for Beijing as Chinese firms are quickly becoming major global biotech competitors.

To foster this trend, China invested $191 billion in research and development from 2005-2013, part of sustained efforts to lay the ground work for the creation of a high-tech knowledge economy. To this end, the government implemented its “Thousand Talents” program, which encouraged Chinese researchers and scientists working overseas to repatriate back to China.

Lured by generous funding and the full support of China’s government-state corporation behemoth, many took up Beijing’s offer.

Cloned in China” products on their way

One of most poignant demonstrations of Beijing’s biotech investments is the announcement that China is constructing the world’s largest cloning facility. Set to open in Tianjin in 2016, the cloning factory is a $500 million investment by China’s Boyalife Group and South Korea’s Sooam Biotech.

This enterprise is the not first collaboration between Boyalife and Sooam, as the two companies previously teamed up to clone Tibetan mastiffs – expensive boutique dogs which are considered status symbols in China.

Once operational, the facility is slated to produce one million beef cattle embryos per year, as well as sniffer dogs and race horses. Boyalife and Sooam hope to profit from rising beef consumption in China, with their cloned products both meeting that demand, while also allowing China to reduce its reliance on foreign imports, thus improving food security.

In recent years, Chinese beef production has declined due to high feed costs, and cheaper high quality foreign imports. The Chinese government appears to be more open than others to cloned products supplementing food production, as witnessed by the fact that currently many strawberries and bananas sold in China are cloned.

Barriers remain in China to cloning endeavour

While Beijing is encouraging the cloning efforts, the Chinese public remains highly sceptical. Online reaction to the announcement of the Tianjin cloning facility was overwhelmingly negative, with ‘netizens’ fearing that Chinese consumers would be used a guinea pigs.

Moreover, Chinese consumers are fully aware of China’s lacklustre food safety record, a fact that makes the idea cloned products even harder to swallow. The site of the factory – Tianjin – has also been criticized online, as poor safety regulations there led to August’s explosion that killed 173 people.

Another wrinkle is the fact that Hwang Woo-suk, head of Sooam Biotech, was at the centre of 2005’s infamous human embryonic stem cell case, in which Hwang and his team falsified research. Since losing his university position, Hwang has become an eccentric biotech risk taker, as witnessed by his ill-fated $133 million project to create a stem cell research centre in Libya in 2011.

China a leading player in gene editing technology

Gene-editing and sequencing technologies are two more research streams that have benefited from Beijing’s largess and attention, with Chinese companies becoming major players in the sector. Currently over fifty Chinese institutions are undertaking research in these fields with almost twenty percent of all gene editing patents (many for crop and plant variations) issued since 2004 stemming from Chinese sources.

One example is Shenzhen’s BGI – which bills itself as the world’s largest genomics organization – which has created modified Omega-3 (the beneficial oil usually found in fish) producing cattle. BGI has also used gene-editing technology to create fifteen kilogram micro-pigs. The pigs are sold for $1600 and are targeted at China’s growing HNWI demographic. Another target market for BGI is researchers, as the micro-pigs drastically reduce upkeep costs for research institutions.

Recently, Chinese researchers at Sun Yat Sen University have also published results from their experiments to alter the DNA in human embryos utilizing the CRISPR-Cas9 gene editing technology. CRISPR-Cas9 has been billed as revolutionary, with proponents claiming that it could be as paradigm altering as the recombinant DNA technology which originally launched the biotechnology industry in the 1970s and 80s.

International regulations lag behind, hindering growth

China has the potential to become a major biotechnology exporter; however, international GMO regulations often stand in the way, failing to distinguish between different product creation methods.

Traditional GMO’s add DNA to products, whereas gene-editing removes or shuts off certain genes. Despite this difference, (especially given public discomfort with the idea of ‘added DNA’) regulations in major markets such as the U.S lack finesse.

Currently, whether cloned Tibetan mastiffs or gene-edited micro-pigs, such products cannot be exported to the United States – a major drawback for Chinese companies trying to access the U.S market, itself one of the largest consumers of GMO products.

Prof. Max Rothschild from Iowa State University explains the dilemma by stating that “the FDA should be grappling with this major difference [added vs. removed DNA] as to how it will affect regulatory policy and whether gene-edited organisms should be regulated in the same way as more traditional GMOs.”

In recognition of the industry’s growing role in bilateral trade, biotech issues are increasingly coming to the fore in China-U.S talks. On November 23rd, the 26th U.S-China Joint Commission on Commerce and Trade was held. As a result of said meeting. China has made pledges to move quickly on outstanding approval procedures for existing biotech products.

Pressure from both Chinese and American biotech companies has seen Beijing and Washington initiate the Strategic Agricultural Innovation Dialogue (SAID) to promote GMO trade, and simplify biotech approval. This adds to last year’s agreement for the U.S and China to station food inspector staff in each other’s countries.

U.S Secretary of Agriculture, Tom Vilsack was among the attendees, and was urged by the U.S Biotech Crops Alliance (USBCA) to push for mutual expedited approval for biotech products. The USBCA called on Vilsack and Washington in general to foster an enabling environment for biotechnology, and push China to adopt a predictable manner with regards to biotech approval.

China’s commitment to work with Washington bodes well for export-orientated Chinese companies. As regulatory barriers are overcome, Beijing is set to reap the rewards of biotech’s brave new world.

About Author

Jeremy Luedi

Jeremy Luedi is the editor of Asia by Africa, a publication highlighting under reported stories in Asia and Africa, as well as special features on how the two regions interact. His writing has been featured in Business Insider, Huffington Post, Yahoo Finance, The Japan Times, FACTA Magazine, Nasdaq.com and Seeking Alpha, among others.