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2.4.2 A survey of some literature

It is clear from the present survey that relatively little literature examines the economic and social implications of biotechnology. Even less literature examines the implications of biotechnology for Third World countries. The latter literature falls into two categories. On the one hand are articles which deal with biotechnology in individual Third World countries, or the implications of biotechnology for Third World countries, from a mainly scientific/technical point of view. These articles are usually in the scientific/technical biotechnology journals (e.g., Bialy, 1986, on Cuban biotechnology, and Mang Keqiang and Lui Yong-Hui, 1986, on Chinese biotechnology, both in Biotechnology). On the other hand are a small number of articles (written by an even smaller number of individuals) which examine the socioeconomic implications of biotechnology for Third World countries. It is the latter literature that will be briefly surveyed in this section.

The authors of these articles agree on a number of central issues. First, they agree that, although there are potential dangers, biotechnology can be a beneficial force in Third World countries, improving the conditions of all sections of the population.

Secondly, they are concerned that, particularly in the area of agriculture, there is an increasing tendency for biotechnological knowledge to be privatized. As shown in Section 2.2.4, the ability to patent new plant varieties has induced a number of large agrochemical companies to acquire seed companies, with a view to marketing agricultural packages (e.g., fertilizer, herbicide, and herbicide-resistant seed package) and thus reaping synergistic economies. This situation, it is argued, contrasts strongly with the development of modern varieties during the so-called Green Revolution, where most of the generation and diffusion of varieties took place in and through public-sector institutions. Thus Buttel et al. (1985b) argue that 'the private and proprietary character of biotechnology research in the developed countries has become especially marked with regard to agricultural applications' (p. 41). They go on to state that

The genesis of the Biorevolution ... introduces the problem of patents and proprietary information into the question of technology transfer. This was not a consideration of the Green Revolution: with public agricultural research agencies producing new varieties, there was no difficulty in arranging for the release and exchange of germ plasm in the public domain.
(p. 43)

Similarly, Dembo et al. (1985) argue that

There is concern among many groups that privatisation in biotechnology in industrialised countries will result in:

- increased secrecy among scientists, for whom open communication of research results has historically been at the heart of maintaining the integrity of scientific research;

- development of products based on profit motivation-rather than concern for public welfare;

- hazards relating to the technology being overlooked because of monetary considerations or secrecy requirements;

- a narrowing of the genetic base due to the use of more profitable (for the seed companies and chemical TNCs) high yielding, often hybrid varieties; and

- increased concentration among industries affected by privatisation.

(p. 44)

Thirdly, it is agreed by these authors, following from the argument regarding increasing privatization, that public-sector institutions, and particularly international institutions, have an important role to play. In this connection it is argued that UNIDO's new International Centre for Genetic Engineering and Biotechnology, based in Trieste and Delhi, has an important role to play as a counter influence.

Fourthly, it is argued that Third World countries are likely to be increasingly buffeted, if not sunk, by the global winds of change being introduced by biotechnology. For example, some agricultural production is likely to move to rich countries as plants are made to tolerate temperate climatic conditions (e.g., by genetic engineering of 'ice-minus' microorganisms which reduce frost damage). Further disruption will result from increased substitutability between agricultural products (e.g., maize, cassava, or potatoes as sources of starch to produce sweeteners to replace sugar or sugar beets) and from the tendency for industrial processes to substitute for some agricultural products (e.g., single-cell proteins for animal or human consumption, reduced by microorganisms living off by-products from the oil industry, substituting for agricultural feeds and foods) [see, for example, Bijman et al. (1986); Ruivenkamp (1986); and Goodman et al. (1987)3.

Since many of these issues have been discussed in detail earlier in this chapter (particularly in Sections 2.2.4 and 2.3), further comment will not be given here.

It is clear that the literature referred to here has been primarily concerned with the first of the three questions mentioned at the start of this section. However, Third World countries are not simply passive players in the biotechnology game. This more active role of Third World countries raises the second and third questions, which have not received much attention in the literature and which will now be considered in more detail.

2.4.3 Preconditions and constraints on third world entry and desirable patterns of specialization

It is important to stress that the current barriers to entry into the biotechnology field are relatively low. Evidence for this proposition comes from the proliferation, particularly in the United States and to a lesser extent Britain, of a large number of small biotechnology firms. Furthermore, some Third World countries have begun to enter the biotechnology area, and these are not only the large countries like India, Brazil, and China, but also smaller countries like Singapore, Cuba, Kuwait, and Venezuela. Buttel and Kenney (1985) note that

Biotechnology is more knowledge-intensive than it is capital-intensive. For example, Nelson Schneider ... a vice-president of E.F. Hutton, has estimated that 'the critical mass of scientists needed to start a biotechnology firm would be at least 25 PhDs and approximately 10-12 million dollars would be needed in initial investment capital'.
(pp. 77-78)

However, downstream processing, involving scale-up, is more expensive. Nevertheless, 'even Eli Lilly's rDNA insulin plants cost only 40 million dollars each' and a 'monoclonal antibody research endeavour would probably cost from 3.5 million dollars to 4 million over three years. If the objective was eventually to produce usable monoclonal antibody based products, the total cost would be from 20 to 40 million dollars over three years' (p. 78). Buttel and Kenney note that 'these costs, of course, may seem large, yet when compared to the outlays and subsidies committed to the building of luxury car assembly plants or importation of weapons, the costs ... are not unreasonable' (p. 78).

Accordingly, they conclude that 'biotechnology still provides a sufficiently open and fluid structure such that successful entry need not be limited to a mere handful of multinational corporations' (pp. 7980). This contrasts strongly with microelectronics and information technology: few Third World countries, apart from the largest and most industrially sophisticated (such as South Korea), are able to produce products like semiconductors, computers, and digital telecommunications switches, although more are able to provide simpler peripheral equipment and still more are able to use these technologies imaginatively.

However, as noted in Section 2.2.3, it is likely that the barriers to entry will tend to rise over time. One reason for this is the increasing economies of scale being realized (as shown in Figure 2.2). Greater scale may not result in cost advantages in all cases. For example, the scaling-up of some kinds of fermentation processes might not lead to reduced unit costs. However, even in these instances, other factors may &your larger enterprises, or enterprises organized as part of large groups (like the Japanese keiretsu). For example, firms that are able to bring technological knowledge from different areas together successfully may reap a decided technical and competitive advantage, as in the case of bioinformatics which welds microelectronic and instrumentation technology with more conventional parts of biotechnology. Another example is distribution: larger firms with marketing networks and brand names may have an advantage in reaping rent from bioinnovations. To the extent that the evolution of biotechnology, for reasons such as these, tends to favour larger enterprises, the barriers to entry will become greater, with important implications for Third World countries.

In some cases this will mean that direct competition with firms and other institutions from rich countries will become even more difficult. Yet even here this does not mean that all Third World countries will be necessarily excluded from such competition. Some Third World countries, and particularly those with large domestic markets, will have the option of attempting to nurture infant bioindustries, while temporarily shielding them by one means or another from the harsh winds of international competition. Here the experience of Third World countries in other areas of technology is relevant. This includes the entry of South Korea into motor cars and semiconductors, the entry of Brazil into small aircraft production, and the Taiwanese entry into production of computer numerically controlled machine tools.

Even if it is assumed that eventual entry by Third World countries into export-competing markets will be difficult, or even impossible, other options will remain open. These include continued production for the protected domestic market despite a lack of international competitiveness in quality and/or price (which may not prove to be an attractive option for some countries) and production for speciality markets. The latter, based on Third World resources and problems, may prove particularly important and may facilitate additional 'South-South' trade. Examples might include genetic engineering of plants adapted to tropical climates, or vaccines against tropical diseases for use in humans or animals. These areas may not appear profitable to large multinational corporations. Furthermore, the ease of access to the basic biotechnologies will be a favourable factor and the economies of firm size discussed above will not be an obstacle if large firms from rich countries remain out of these markets (though such economies may favour larger Third World firms against smaller ones).

On the 'supply side', however, crucial questions are raised regarding the science and technology capabilities required for entry even into comparatively 'easy' protected and speciality markets. Here it is essential to understand that biotechnology is a science-based industry and probably more than any other industry in Third World countries it will require a firm foundation in the relevant sciences. In a publication on capability building in biotechnology and genetic engineering in developing countries McConnell, one of the scientists involved in the early stages of the development of the UNIDO-initiated International Centre for Genetic Engineering and Biotechnology (ICGEB), states that it is necessary 'to drive home the point that the basic ingredient of biotechnology is basic science in the relevant fields' (McConnell et al., 1986, (p. 26). Genetic engineering, the heart of new biotechnology, 'is composed of many different experimental procedures ranging from organic chemistry through biochemistry to microbial genetics' (p. 26). However, unlike 'say applied microbiology or applied botany which are parts of biotechnology for which the basic sciences exist in many developing countries, the basic science underlying genetic engineering is essentially absent' (p. 27). Accordingly, McConnell concluded

In general, the genetic engineering and biotechnology research base, particularly in molecular genetics, at institutes and universities in each developing country visited by the Select Committee (of UNIDO), was observed to be weak. In effect none of these countries presented substantial evidence of genetic engineering and biotechnology research being conducted at a competitive international level.
(p. 15)

To increase the rigour of this discussion it is worth categorizing the different components of the stock of capabilities required for successful entry into biotechnology. This categorization is a variant of that developed in Section 2.2.4. (However, it must be realized that the greater the degree of international competition envisaged for a country's biotechnology industry, the greater the 'quality' of scientific and technical knowledge that will be required.) The following components of the 'biotechnology capability stock' may be distinguished:

1. Core scientific capabilities;

2. Complementary capabilities I (relating to scale-up and bioprocessing);

3. Complementary capabilities 2 (relating to infrastructure, transport and repair facilities, foreign exchange availability, etc.);

4. Complementary assets (such as marketing and distribution networks).

These components are part of an interdependent knowledge system on which the ultimate output and efficiency of the biotechnology industry depends.

Regarding core scientific capabilities and complementary capabilities 1, UNIDO has identified 'certain basic capabilities ... required to support all aspects of the scientific programmes to be undertaken at the International Centre for Genetic Engineering and Biotechnology' (UNIDO, 1986, p. 15). These include:

Molecular Biology
Studies with nucleic acids (genetic engineering, sequencing, synthesis), host-vector systems, cloning and expression in prokaryotes and eukaryotes.

Protein purification, enzymology, protein sequence determination, peptide synthesis, physical chemistry of biological molecules and natural product isolation, structure, and synthesis.

Biochemical Engineering
Bioreactor design, fermentation, product recovery and purification.

Studies of microorganisms, genetics, physiology, the development of novel screening methods, and culture maintenance.

Cell Biology
Eukaryotic cell culture, immunology, including antibody production and culture maintenance.

Computing and programming as applied to the analysis of structure and function of biological molecules, computerized control of instrumentation, data base access and communication facilities.
(p. 15)

Several comments may be made. First, there may be some debate about the areas included and excluded in this UNIDO list of 'basic capabilities'. Second, while these may be the capabilities required for UNIDO's programme of research, it does not follow that they are necessary capabilities for Third World countries attempting to enter the field of biotechnology. This, in turn, raises a number of important further questions. For example, what meaning is to be given to McConnell's statement, quoted above, that for Third World countries to enter the biotechnology area it is necessary that they understand that 'the basic ingredient of biotechnology is basic science in the relevant fields'. How basic must this 'basic science' be? It is presumably not always necessary for Third World scientists, assuming that they and their institutions are pursuing the pragmatic goals of using biotechnology to produce products judged to be of use to their country, to master all of the fundamental knowledge pertaining to their field of work. Although their work will be science-based, the 'depth' of their scientific knowledge might not have to be as great as that of the most advanced scientists in the field, given the practical goals that they may be pursuing. Furthermore, it will be possible, to some extent, to 'free ride' on the basic research being undertaken in the rich countries without having to master the scientific capabilities underlying that research. From the point of view of such Third World scientists the open nature of the science system in rich countries, facilitated by means such as publication and other modes of transmitting information, often makes the question of access relatively simple. An important policy question, therefore, revolves around the issue of deciding on the scientific capabilities, more specifically the 'depth' and the costs of acquiring them, that are required to make pragmatic use of biotechnology. (Incidentally, it is also worth noting that it is difficult to distinguish 'science' from 'technology' in discussing what we have termed the 'core scientific capabilities and complementary capabilities 1', the latter referring to scale-up and bioprocessing. Here the traditional disciplinary distinction between 'science' and 'engineering' tends to break down.)

Third, quite apart from the question of the knowledge itself, is the issue of the appropriate institutional and organizational forms that are required (a) to develop the knowledge and (b) to give it effect. This opens up a further range of policy questions that will, however, not be pursued here.

However, what we have referred to as 'complementary capabilities 2' are also necessary for an effective use of biotechnology, and are therefore included here in the interdependent system of capabilities. For example, Riazuddin, in the UNIDO publication on capability building in biotechnology (McConnell et al., 1986), notes that although 'new biotechnology does not necessarily require sophisticated and expensive working', the 'heart of the technology is the regular and reliable supply of rare biochemicals'. However, acquiring these materials in developing countries presents the following difficulties:

1. Hard currency. Since all of these materials have to be imported, payment is required in hard currency. If extra funds are available to scientists in developing countries, they are in local currency. Conversion into hard currency, if possible, consumes considerable time and effort.

2. Transportation: Most enzymes and related materials are unstable at ordinary temperatures and are generally shipped in dry ice. Standard-sized cartons cannot take more than a few kilogrammes of dry ice that normally lasts for 2448 hours. However, the journey time to many cities in Asia and Latin America usually exceeds 48 hours. Increasing the quantity of dry ice makes air transportation charges prohibitively expensive. Moreover, there are usually no facilities for cold storage at the receiving airports in developing countries. Therefore, goods collection by the customer has to be extremely efficient, which is not always the case.
(pp. 52-53)

This gives a flavour of some of the problems that scientists and biotechnologists in developing countries will have to grapple with, problems that their colleagues in rich countries can assume away. The final part of the capability package relates to complementary assets, such as marketing and distribution networks. As shown in Section 2.2.4, these are essential for appropriating rent from biotechnological knowledge. Once again there are many special problems that confront Third World countries, including those attempting to engage in 'South-South' trade.

A further issue of critical importance is the nature of the relationship between the 'science base' and the country's production system. For a science-based technology like biotechnology to play a productive role, strong two-way links are required between science and production, with science and its expanding potentials 'pushing' production at the same time as being 'led' by the needs of the production system. This raises a number of complex issues which are highlighted by the literature on Third World countries. This literature has pointed to the frequent alienation of the science base from the requirements of domestic production in these countries [see references to Cooper in Fransman (1986a)].

Additional questions relate to the most appropriate mode of entry into biotechnology for Third World countries. This acknowledges that alternative ways of entering the biotechnology field exist, and raises the policy question of deciding on the most suitable. For example, Cuba, which was judged by the UNIDO team of experts setting up the International Centre for Genetic Engineering and Biotechnology to have one of the best biotechnology programmes in the Third World, used interferon as a 'model' for entering the area of genetic engineering. This programme utilized the well-developed health infrastructure that Cuba built up as a result of its national emphasis on the health sector since the revolution, as analysed in greater detail below.

By contrast, the Brazilian mode of entry has been largely through the ethanol-from-sugar programme [see Rothman et al. (1983) for details on the programmed. Genetic engineering has become important as a result of the ability to alter the genetic composition of microorganisms that transform sugar into ethanol, thus improving their efficiency. The existence of alternative modes of entry raises further questions, with important policy implications, regarding social costs and benefits of different ways of entering and establishing basic capabilities in genetic engineering in particular, and biotechnology in general.

The choice of specialization in biotechnology raises further issues. Since it will often be possible to import biotechnology-related products, the question arises 'When is it advantageous to establish local production capability?'. This question has crucial policy implications (e.g., Is it worth producing interferon in Third World countries?), although it is analytically complex. Fortunately, however, literature exists that addresses closely related areas, such as the policy question of when to import capital goods into developing countries, and when to produce them locally (i.e., the make-import decision) (see Fransman, 1986c, Chapter I for a detailed discussion). The conceptual approach in this literature can be applied to biotechnology and further developed for policy purposes.

Finally, it must be recognized that the Third World is a heterogeneous collection of countries. What is relevant for Brazil will often not be appropriate for Bolivia or Botswana. Clearly, despite the barriers to entry to biotechnology that are low relative to microelectronics and information technology, many Third World countries will not, and perhaps should not, develop biocapabilities as a result of the high opportunity costs. This raises further questions of how these countries may benefit as users of biotechnology-related products. Here too, many issues remain to be identified and researched.

2.4.4 An illustrative case study: cuba's entry into new biotechnology

The Cuban case illustrates dramatically what can be achieved when a firm commitment is made to develop biotechnology capabilities and apply them to a wide range of areas in accordance with the country's economic priorities. In this section the Cuban case is examined in greater detail, paying particular attention to the way this country entered the field of new biotechnology, the areas in which new biotechnology has been applied, and the institutional changes brought about to facilitate the development of biotechnology. Finally, based on this case study, conclusions will be drawn regarding lessons for other developing countries. General approach

The crucial watershed in Cuba's scientific and technological development occurred after the Cuban Revolution in 1959. Until then, Cuba depended primarily on agricultural activities, which lacked sophisticated processing and R&D capabilities, and on tourism. In this way foreign exchange was earned, which financed imports of manufactured products, largely from the United States. After the Revolution, a new set of priorities was established. Most important for development of the biological sciences in general, and biotechnology in particular, was the emphasis given to the role of science and to the development of the national health service. Frequent reference is made by Cuban scientists to the conviction prevailing at that time that the future development of Cuba was inextricably bound up with the future development of science in the country. It was this conviction that inspired rapid growth in the school and higher education system. At the same time, an important result of the Revolution was the expansion and extended delivery of medical services to all sections of the population. This meant that within a short time, Cuba was able to develop a relatively sophisticated medical system, which included training and research facilities in universities and other national institutions. It was this medical system that was later responsible for Cuba's rapid and successful entry into new biotechnology.

However, new areas of science and research do not emerge automatically; their emergence depends on new groups of scientists and researchers, committed to the new fields of study and devoted to the institutional changes required to realize new scientific research. From this point of view it is significant to observe that the new institutions which evolved in Cuba to develop the biological sciences and biotechnology emerged in a pluralistic rather than a linear way.

At the apex of Cuba's scientific planning establishment is the Cuban Academy of Sciences, which was originally established in 1861 but substantially restructured after the Revolution. The Academy contains the Superior Scientific Council, which consists of about 77 distinguished scientists elected from the Academy's various institutes, from the Ministry of Higher Education, and from industry. The Academy also contains a number of other smaller but influential advisory groups. However, it is significant that the Academy does not totally dominate or control the scientific establishment. For example, only about 10% of the total number of Cuban scientists and engineers work in Academy institutes.

The Ministry of Higher Education, with some degree of autonomy from the Academy, has also played an important role in the establishment of scientific institutions. From the point of view of the development of Cuban biotechnology, an important example is the establishment of the National Centre for Scientific Research (CENIC), which was the major biomedical and chemical research centre and was set up in 1965 to stimulate research in new areas. CENIC has a staff of approximately 1,000 and is divided into four main divisions: biomedicine, chemistry, bioengineering, and electronics. CENIC has played a significant role in research and in training scientists who subsequently have become involved in other spin-off institutes.

An important example is the Centre for Biological Research (CIB), which was established in January 1982. The establishment of CIB is of particular interest as a result of its innovative and unbureaucratic origins. In 1981 a 'Biological Front' was established essentially outside the existing bureaucratic framework. The Front consists of scientists and policy-makers with an interest in extending and developing biological research in various directions. It served to coordinate and articulate the interests of those in different Ministries and institutes who wished to strengthen Cuban involvement in biotechnology. While the leaders of the existing scientific establishment were closely involved with the activities of the Biological Front, the Front was set up as a high-level policy-making body, relatively autonomous from the Academy and the various Ministries involved in biological sciences and their areas of application.

From this position the Front supervised the establishment of CIB and later the Centre for Genetic Engineering and Biotechnology (CIGB). By helping to give birth to CIB and CIGB, the Biological Front served to increase pluralism in the Cuban scientific system. While biotechnology could be developed in existing institutions, such as those under the control of the Academy of Sciences and CENIC, this new set of technologies could also be advanced through new institutions such as CIB and CIGB.

CIB began with a staff of six researchers in a small laboratory. Its major initial mission was the production of interferon for use as an antiviral agent. The interest in interferon resulted in part from the outbreak in late 1980 of dengue haemorrhagic fever, which affected approximately 300,000 people and resulted in 158 deaths. In addition to this pragmatic goal, CIB also aimed to use interferon as a 'model' for development of the wider range of capabilities and assets analysed in Section 2.4.3. In other words, interferon would be used as a springboard for developing a Biotechnology-Creating System with expertise in the areas of genetic engineering and bioprocessing. CIB grew rapidly and by 1986 was divided into four laboratories: genetic engineering, immunology, chemistry, and fermentation. In addition to interferon, CIB also produces its own restriction enzymes. Its research also involves synthesis of oligonucleotides; cloning and expression of a number of other genes, and production of monoclonal antibodies for diagnostic purposes. Although recombinant DNA research was also done in a number of other institutes, notably CENIC and to a lesser extent the Cuban Institute for Research on Sugarcane Derivatives (ICIDCA), which was established in 1963, by the early 1980s CIB became the major location in Cuba for the development of capabilities in new biotechnology.

When CIB opened in January 1982, it began to produce human leukocyte alpha-interferon using a method (which did not involve genetic engineering) developed by Kari Cantell of the Central Public Health Laboratory in Helsinki. Cantell gave assistance by transferring his method to CIB and was surprised at the speed with which the Cubans mastered the method. Having mastered this conventional method for producing interferon, CIB embarked on rDNA-based techniques to produce various kinds of interferon.

In this latter task a central role was played by scientists such as Dr. Luis Herrera, who was Vice-Director of CIB. Herrera's background is particularly interesting because it illustrates personally the way Cuba was able to enter the field of new biotechnology. In 1969 Herrera studied molecular genetics (working on yeast) at Orsy University in Paris. The following year he took a post as researcher at CENIC, where he started a laboratory dealing with the genetics of yeast.

Yeast was of interest in Cuba because it was used to convert sugarcane derivatives into single-cell proteins. These were used as animal feed to substitute for imported soya feeds, since the Cuban climate is not suitable to grow soya. Research on yeast partly aimed to improve yeast strains to increase the nutritional value of the single-cell proteins by eliminating some of the undesirable nucleic acids. Under the auspices of ICIDCA there were in total 10 plants each producing 12,000 tons per annum of single-cell protein for animal consumption. In developing their work, researchers in this laboratory became interested in new biotechnology.

In 1979 Herrera returned to France to study molecular biology and genetic engineering. With the formation of the Biological Front and the establishment of CIB in 1982, he joined the Institute as its Vice-Director. In 1983 he once again went to France where he spent time at the Pasteur Institute. Representing a new breed of young, post-revolution scientists who were quickly able to master the latest international research techniques, he has since established an international reputation for his research in new biotechnology.

Although in the case of Dr. Herrera entry into new biotechnology involved access to European institutes, Cuban biotechnology and CIB in particular have also benefited from Soviet science. A notable example is the group of chemists working in CIB and mostly trained in the former USSR. With a strong background in organic chemistry some of these scientists moved on to synthesis of oligonucleotides and DNA. Other groups in CIB are involved in immunology, including immunochemistry and protein purification and fermentation.

There is widespread agreement that the Cuban mastery of new biotechnology has been impressive. One example is the conclusion by a team of UNIDO experts appointed to find a Third World location for the new International Centre for Genetic Engineering and Biotechnology. This team visited the major Third World countries involved in biotechnology and concluded that the Cuban biotechnology programme was one of the best they had seen. Another example is assessments made by distinguished foreign visitors to Cuba. While acknowledging that the Cubans are not attempting to do world frontier basic research, many of these visitors have been impressed with the level of achievement of Cuban biotechnologists. Interferon as a 'model'

Some further comments are in order on CIB's use of interferon as a 'model' for the development of new biotechnology capabilities.

The first point is that the development of core scientific capabilities in new biotechnology at CIB drew on the already well-developed science base that existed in Cuba by the time the CIB was set up in 1982. Mention was made in the last section, for example, of the earlier research done at CENIC on the molecular genetics of yeast. In entering new biotechnology, therefore, Cuba was not starting ab initio. Thus, Cuban entry into new biotechnology was facilitated by a preexisting stock of substantial scientific capabilities. Clearly, many developing countries are not in as fortunate a position.

The second point is that interferon was an appropriate choice for Cuba largely as a result of the country's well-developed health sector. This meant that development of interferon using genetic engineering techniques was not simply a 'pure' research activity. Rather, it was an example of scientific work being linked closely to the production of useful output, namely the delivery of medical services, a high priority in post-revolutionary Cuba. This link established a unity between 'science push' and 'demand pull' determinants of technical change, which in turn ensured that this part of the science system was not 'alienated' from the needs of the rest of the socio-economy. Interestingly, interferon has also been used as a 'model' by many Japanese companies entering the field of new biotechnology. In their case, however, the need determined from the corporation's point of view was for a way to acquire new biotechnology capabilities while simultaneously producing a commercializable product. Interferon, it was believed, was one of the first new commercial products based on biotechnology. For other developing countries, however, a different product may represent a more appropriate 'road' to the development of new biotechnology, depending on the circumstances and priorities of the country. For Brazil, for example, the ethanol from sugar project may have provided an appropriate road. In other Latin American countries the development of mineral-leaching bacteria for mineral extraction may provide an appropriate way of entering new biotechnology.

Third, the possibility of using interferon as a 'model' for the development of other applications and products illustrates the pervasiveness of new biotechnology. This point is further supported in the Cuban case by the history of the Centre for Genetic Engineering and Biotechnology. Realizing economies of scope: CIGB and the pervasive applicability of new biotechnology

Encouraged by the success of CIB in developing new biotechnology capabilities and impressed with the potential of this set of technologies, the Biological Front recommended the establishment of a new and larger institute which would carry on and extend the work of CIB. Accordingly, on I June, 1986, the Centre for Genetic Engineering and Biotechnology was established on a new site near CIB.

CIGB was structured in terms of the following five groups, each dealing with a specific problem area:

1. Proteins and hormones. The aim of this group is to use recombinant DNA techniques to produce proteins for applications in human medicine and veterinary science. This group continues the work done in CIB on the chemical synthesis of oligonucleotides and DNA.

2. Vaccines and medical diagnosis. The aim of this group is to develop vaccines against diseases prevalent in Cuba and other tropical and subtropical areas by cloning the surface proteins of viruses, parasites, or bacteria. The group is also working to develop monoclonal and polyclonal antibodies and DNA probes for detection and diagnosis of various illnesses.

3. Energy and biomass. The research of this group involves the transformation of various kinds of biomass via chemical methods and enzymes. For example, research is done on yeasts and fungi that transform the sugar by-products of molasses and bagasse into proteins for animal consumption. This group has produced a new strain of the yeast Candida, which increases the production of an amino acid important for both human and animal nutrition. CIGB will extend research in this area done at ICIDCA and CENIC.

4. Plant breeding and engineering. This group does research on improved plant varieties using genetic engineering and other biotechnologies, such as cell culture. Nitrogen fixation is one area singled out for study.

5. The genetics of mammalian eukaryotic cells. This group uses the cells of higher organisms to clone genes for protein production.

By using interferon as a 'model', first CIB and then CIGB have been able to develop core scientific capabilities in the area of new biotechnology and apply these capabilities to a wide range of areas consistent with Cuban development priorities. However, the research of CIGB has also been defined to include an emphasis on 'complementary capabilities 1', namely downstream bioprocessing. This has been done by making provision for a pilot bioprocessing plant at CIGB. The importance of downstream bioprocessing

As noted earlier in this chapter, development of an effective biotechnology-creating system involves more than mastery of the core scientific capabilities. One necessary feature of such a system is downstream bioprocessing capabilities. To develop these capabilities, CIGB has established a pilot plant. Two groups work with this plant: one specializing in the fermentation process and doing research to optimize productivity, and the other working on questions of purification. Both of these groups face the difficulties inherent in scaling-up bioprocessing by using larger bioreactors. A major problem confronted by both groups is that there is little experience in Cuba in bioprocessing and scale-up. Furthermore, unlike many of the core scientific capabilities, where research is done in universities and the results are usually made public, a good deal of research on bioprocessing is done by private companies and the findings are kept commercially secret. Bioprocessing, requiring sophisticated engineering skills and specialized inputs, frequently constitutes more of a constraint in developing countries than mastery of the core scientific capabilities.

The same point was stressed by senior officials involved in biotechnology planning in the People's Republic of China during my visit there in 1987. In China, in strong contrast to the Cuban example, the core scientific capabilities were acquired rapidly, largely as a result of scientific interchange with the United States. However, major constraints exist in China in downstream bioprocessing, which depends on the capabilities of Chinese industrial and engineering enterprises.

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