Proceedings of the Standing Senate Committee on
Agriculture and Forestry
Issue 18 - Evidence - Meeting of May 31, 2012
OTTAWA, Thursday, May 31, 2012
The Standing Senate Committee on Agriculture and Forestry met this day at 8:01 a.m. to examine and report on research and innovation efforts in the agricultural sector (topic: using plants to manufacture pharmaceuticals, and market opportunities).
Senator Percy Mockler (Chair) in the chair.
[English]
The Chair: Honourable senators, thank you for being here.
I welcome you to this meeting of the Standing Senate Committee on Agriculture and Forestry. In order to permit the witnesses to have an idea of who the senators are, I will ask the senators to introduce themselves, and I will start. My name is Percy Mockler, Chair of the Standing Senate Committee on Agriculture and Forestry, from New Brunswick. Now I will ask the deputy chair to introduce himself.
[Translation]
Senator Robichaud: Fernand Robichaud, Saint-Louis-de-Kent, New Brunswick.
[English]
Senator Mahovlich: Frank Mahovlich, Toronto, Ontario.
Senator Buth: Senator JoAnne Buth, Manitoba.
Senator Eaton: Nicole Eaton, Ontario.
[Translation]
Senator Maltais: Ghislain Maltais, Quebec.
Senator Rivard: Michel Rivard, The Laurentides, Quebec.
[English]
The Chair: The committee, honourable senators, is continuing its study on research and innovation efforts in the agricultural sector. Today, we will have two witnesses who will be focusing on the use of plants to manufacture pharmaceuticals and market opportunities for that.
The first panel will be Dr. Hall, but before we begin I would like to share with you the order of reference, that the Standing Senate Committee on Agriculture and Forestry be authorized to examine and report on research and innovation efforts in the agricultural sector, in particular: developing new markets domestically and internationally, enhancing agricultural sustainability and improving food diversity and security.
Dr. Hall, I would like to take the opportunity to say thank you for accepting our invitation. You will make your presentation, and then we will have the senators ask you some questions. Again, thank you. I believe you are in Guelph, Ontario.
J. Christopher Hall, Chief Scientific Officer, PlantForm Corporation: That is correct.
The Chair: Can you hear us well?
Mr. Hall: Yes. Can you hear me?
The Chair: We hear you very well, sir. As we say in l'Acadie in New Brunswick:
[Translation]
You have the floor.
[English]
Mr. Hall: Thank you. Good morning, ladies and gentlemen. My name is Chris Hall. I am Chief Scientific Officer of PlantForm Corporation, which was formed in 2008. I am a founding member, along with Dr. Don Stewart and Dr. Mark Goldberg.
Today, I want to take you through a little bit about what we are doing with regard to making pharmaceuticals in plants. It is actually a reality in our company. We are making what are called biologic drugs, which are defined as substances made from a living organism or its products and used in the prevention, diagnosis or treatment of disease.
There are various types of biologic drugs. They can be small molecules, naturally produced, or they can be large, molecular-weight molecules — proteins — of weights over 1,000, that can be made either by natural processes or by biotechnology. In our case, we will be talking about monoclonal antibodies, which are what we raise in plants, and I will be giving you background on these antibodies and what they are used for.
Why are we using plants as a production system? We move the genes for the production of antibodies from mice into plants, and we get the plants to express the antibodies, after which they are extracted and prepared.
The reasons for using plants are: low capital and production costs and ease of production, harvest and storage. In other words, they are a cheap form of bioreactor. We can produce multiple proteins in one crop plant. There are no human pathogens that might be found in traditional systems using animal cells or animals themselves, and large scale production is possible.
The other two major points are reduced development timelines, which are now possible using plants through our work and other people's work around the world, and new opportunities for growers in the agriculture sector to increase the value of their products.
If we look at the production system comparison, as it stands now, producing 400 kilograms of antibody drug per year is traditionally done in mammalian fermenters where CHO cells — or Chinese hamster ovary cells — are modified to produce the antibodies and actually produce the antibodies into fermentation vats. The cost of building such a facility is, at the low end, about $450 million for a 5,000 litre fermentation vat, and this may go up as high as $800 million.
For a 12-acre greenhouse facility with similar processing equipment to the 5,000 litre system, the cost is about one fifth — $80 million. This substantial difference in the cost of the platform allows people who do not have deep pockets but only medium-deep pockets, if there is up such a term, to enter into the production system more easily.
It is virtually an untapped market for biosimilar drugs. About a hundred billion in biologics lose patent protection from now till 2020, so there is a huge opportunity for us to come in and make biosimilar drugs. Those are drugs that are essentially similar to generics, but, because they are large, molecular-weight proteins, they are not exactly the same as the innovator's drug. However, they are close and have all the same properties in terms of disease control.
PlantForm's technology platform will substantially reduce the cost of goods to enter this marketplace. I show an example here for Trastuzumab. The innovator drug name is Herceptin. The cost per vile is about $3,500 for the name brand drug. You can see the portion that is profit, sales and marketing and a third area for the cost of goods. If we look at traditional biosimilars produced in animal cells, the cost would come down about a thousand dollars, and if we look at PlantForm's system, our costs would be about half of what the name brand would be. This would allow us to go into the marketplace by reducing the cost of goods but not affecting the profit margins initially, which is very important.
Also, by making biosimilar drugs, we are moving in on drugs that are coming off patent. You can see that for an innovator drug, it is about 13.5 years to full registration. With a biosimilar drug, that time is reduced in half, at least, to about 5.5 years. The pre-clinical is the same length. The clinical trials are reduced in half, and the review is about the same time. I should correct myself: There is no discovery phase, so that saves us five years as well.
Our production platform is to take antibody genes from animals. We moved the antibody DNA into plants using agrobacterium tumefaciens. We select antibody-producing tobacco plants. Once these plants are selected, and those plants that are breeding true and producing the antibody, they can be ground up in large grinders. We get a purée, something that looks like a smoothie. You can then filter this and do various purification processes to prepare the antibodies in pure form.
Our first Canadian product that we are going forward with is trastuzumab, which you would know as Herceptin. Trastuzumab is a leading antibody drug for HER-2 positive breast cancer patients, namely women, although it does affect some men. Herceptin sales are about $6 billion per year and expected to grow to $7.4 billion by 2016. We estimate the market for biosimilar trastuzumab to be as large as $2 billion or more — a huge opportunity to move in on.
In terms of our progress to date in the production of trastuzumab, we have created the plants and a laboratory process to process the plants and produce the antibody in pure form by using purification techniques. We move this technology to a company in the United States called Kentucky BioProcessing, where they scale the product process up. We ran several trial runs there using 50 kilograms of plant material. We managed to produce multiple grams of trastuzumab, which has been formulated and is being used in animal trial studies to look at efficacy of our compound versus the innovator drug, Herceptin.
We are also moving forward with two other biosimilar drugs: Avastin, which is used for colorectal cancer. It is an $8.9 billion market. It comes off patent in about 2017. Also, we are producing Erbitux, which is used for head and neck cancer. Both of those drugs are antibody-based. Currently, we are looking at our own innovator antibody drugs that we are taking forward right from the beginning to look at HIV/AIDS control.
I will wrap up by giving you our management team: Don Stewart, who came from Cangene originally, is our Chief Executive Officer; David Cayea is our Director of International Relations; and Ron Hosking is our Chief Financial Officer with many years of experience in dealing with and working in multinational biotech companies.
With that I will end, thank you.
The Chair: Thank you very much, Dr. Hall. We will proceed with questions.
Senator Robichaud: Mr. Hall, your presentation is very interesting and shows a lot of promise for people who would like to follow your studies and the products you are developing. One thing caught my eye: You move a phase of production to the United States. Why would you do that?
Mr. Hall: Currently, no one in Canada has the facilities. Kentucky BioProcessing, which of course is in Kentucky, had funding from the Defense Advanced Research Projects Agency, DARPA, in the United States. They were able to build a 1.2-acre site. It is a multi-tiered controlled environment facility where they have all the processing facilities and are doing products, vaccines and other antibody-based drugs — some for the military, for example. There was a real impetus from the U.S. government and support from the U.S. government to do that. We have talked to them about building a similar facility in Canada and trying to raise the money for it. They are also working in South Africa and building a facility there with the help of money from South Africa.
Senator Robichaud: It is a matter of finding the money to put the basic structure in place. Is there no financing available in Canada at this time?
Mr. Hall: Not at this time, although we are pursuing it. The CEO, Don Stewart, has talked to a number of people in Ontario and in Ottawa about trying to build such a facility. I would say that our number one objective now is probably to gain enough operating money to keep our company going. That tends to be our primary concern right now.
Senator Robichaud: That shows a lot of promise. You mentioned the development of a few antibodies, as you call it; and I am sure there are more in the pipeline, are there?
Mr. Hall: Yes. We will have three candidates, and there are more available in the future to be looked at. As well, there are more coming off patent. We had a list of about eight. We went initially with trastuzumab or Herceptin because it was the first off patent. Then we are going to Avastin and Erbitux, as I told you. There are a number of others that we are putting as a third tier. The market for them is good, not quite as good as the first three but still quite lucrative. There will be more coming off patent by 2020 that we will pick up as we go along.
Senator Robichaud: This is very interesting.
Senator Eaton: Dr. Hall, to continue what Senator Robichaud started, we have come across something in our studies in both forestry and agriculture: Canadians seem to be very innovative but there seems to be a lack of a bridge between what you are doing, which is innovation, and business or the private sector. You have managed to get it quite far, but there is still a way to go. As you say, you are still looking for money to keep your company afloat.
Do you have any ideas as to what we could recommend in our report to help people like you and others who are working in universities or near universities on very innovative things? How can you get the eye of the private sector investor? What kind of bridge should there be?
Mr. Hall: I think Don Stewart could answer that better than I could, but let me take a stab at it based on my experience.
Biotech is a bit tainted from the 1990s. A lot of promises were made, and the delivery was poor at that time in the early days. That has changed, but the market was badly bitten so they are a bit reluctant to move forward. That is one reason.
Nowadays in Canada it is very hard. We are trying to raise $10 million in our first go. We have tried in Canada, but it is very hard to raise that kind of capital for biotech, so we have moved into the United States and to the United Arab Emirates to try to get the money. We are also looking at Europe. It is harder to raise venture capital and money from private sectors because Canada is a smaller country and we are conservative by our nature. It is difficult.
That is one thing I would have to say. The other thing I would have to say is government has been helpful to us. In the research components it has been very helpful. There has been help as we are moving out of that phase, but what we call the ``valley of death'' that you are talking about is still hard to get across in Canada, just because I do not think we have the amount of money that the United States, Europe and United Arab Emirates and other places in the Gulf have. It is that simple.
Senator Eaton: You stated that you had relationships around the world. Do you have relationships with other innovators or with other people doing what you are doing or with other universities doing the same kind of research? What did you mean when you said you had global relationships?
Mr. Hall: We have good relationships at a scientific level all over the world, particularly in Europe, in some of the molecular engineering components, and with people in the United States.
Senator Eaton: Are they doing the same kind of innovation or are you ahead of the curve in some cases?
Mr. Hall: Yes. We are among the leaders in the world. There are probably only about three or four companies in the world doing what we are doing, and not exactly the same way although close enough for the sake of this discussion. There is one in Israel, one in Europe, two in the United States, and one other in Canada.
We are in a small pool of groups of people around the world that are going forward to actually go into the commercial marketplace.
Senator Eaton: Thank you very much.
Senator Mahovlich: Does climate have a lot to do with this? Do we have to have greenhouses to grow these particular plants, or do we have to go to the south of the United States or to South Africa to grow a lot of these plants that you are going to use?
Mr. Hall: That is a very good question. Let me step back a bit on that. First, these are genetically modified plants, as you understand. We picked tobacco because it is not a food crop. We did not want to make people nervous about these genes being in a food crop. We also feel that it is necessary to grow these plants initially in the early days, and I would say over the next decade, indoors, firstly because the growth conditions are better, and secondly to keep them quarantined, again, to make the public feel a little more secure and confident in what we are doing.
Canada, and in particular Ontario, is known worldwide for its excellent greenhouse facilities. We are a leader in the greenhouse/hothouse industry in the world for controlled environment chambers. We also work closely with the space programs in the United States and Europe because of our expertise in closed environments for their space programs.
We have the capability to grow these plants in greenhouses in Canada. The technology is there. They would be sophisticated, environmentally controlled greenhouses. They exist right now for growing tomatoes, cucumbers, peppers and other things.
I do not know if you have ever been to these facilities but they are quite amazing to see, and they are large commercial operations.
Senator Mahovlich: Are they controlled from insects?
Mr. Hall: Yes, there is biological control in there. Of course, there are no weeds and they also have biological ways of controlling fungal pathogens as well.
Senator Buth: Good morning, Dr. Hall. It is very good to listen to your presentations and to hear about the company and the strides that you are making.
Where is Canada in terms of approval for something like this and where are you in the regulatory process, or are you not looking at Canada at all?
Mr. Hall: Yes, we are definitely looking at Canada. We feel that what we can bring to the marketplace is substantially reduced cost of materials that would help our publicly funded health care system, but our market is the world. We would like to start in Canada, but we are not going to just solely look at Canada.
Where are we? First, we are at animal studies where we are looking at efficacy and comparing it to the innovator drug Herceptin. That is ongoing and will be complete shortly. Then we have to do phase 1 and phase 3 trials. We do not have to do phase 2. Normally, with an innovator drug, you would have to do phase 1, phase 2 and phase 3. We only have to do phase 1 and phase 3 because it is a biosimilar, and the size of those studies is reduced from what it would be for an innovator drug.
We are still targeting 2014, 2015, to go to the market, and we are gearing up to begin phase 1 trials late in this year.
We have the facilities to do all that in Canada. We have tried to keep that in Canada as much as possible. Except for the production at Kentucky BioProcessing, we kept it in Canada. I do believe we have the capabilities to do everything in Canada — in fact I know we do. We can build the facilities, we have the qualified people, and we have the capacity to do it.
Senator Buth: We have not approved any plans for molecular farming in Canada. I do not know where we are at in the U.S., but there was an incident in the U.S. with corn that was grown outdoors. Do you expect to get regulatory approval for production in Canada if we can do it in Canada? What does that regulatory process look like in Canada compared to the U.S.?
Mr. Hall: I believe it is very similar to the United States. They are not in place yet but regulations have come down early this year in the U.S., the FDA, and they will be coming down in Canada as well. I do not see it as a problem. There are some examples already in place with one drug that the Israelis are producing for Gaucher's disease. There are precedents. I do not really see that that will be a hurdle. It does not really matter whether it is grown in E. coli or in plants or whether they come out of yeast. I think the regulatory authorities realize now that those drugs have the potential to be as good as anything produced in animal culture. I do not see that as a hurdle.
Senator Buth: You are talking about the efficacy but I am also talking about production. We have never approved anything in Canada for production because it is in a plant and there are concerns about escapes and things moving into the environment.
Mr. Hall: As far as I know we are producing it in our facilities here at the University of Guelph, but they are all quarantined and they are all regulated by the government.
Senator Buth: You are clearly down the path then.
Hon. Senators: I do not see it as a problem.
Senator Buth: Great. Thank you very much.
[Translation]
Senator Rivard: Mr. Chair, for the past few months, we have met with witnesses every week, the purpose of this committee being to examine research and innovation efforts in the agricultural sector. Without minimizing the value of previous witnesses, I must say that this morning we were given the best example of what is going on in research and innovation. I would therefore like to congratulate this morning's witnesses.
There is one number that still impresses us. You estimate that the revenues from biologic medicines will amount to $239 billion by 2015.
To give you some idea of what $239 billion represents, it is about the same amount as the Canadian budget for 2012. That tells you how enormous it is.
Do you have a counterpart in another province of Canada, in Quebec, for example? Is Quebec engaged in the kind of research you are doing in Guelph, Ontario? Do you know of any similar work being done in Quebec?
[English]
Mr. Hall: That is a very good question. Yes. One of the leaders in this technology was a company called Medicago, which is currently stationed in Quebec City. It is not focusing primarily on antibody-based drugs but rather on vaccines. They spent probably at least 15 years doing really good, innovative work, supported by the governments of Quebec and Canada. They were just limping along for years, but keeping things going. In the last two years, they have had a major breakthrough and have gotten funding in the United States. They are beginning to make some vaccines and a plant in the United States as well.
Medicago in Quebec is the first example of a company using plants to produce vaccines, which is different, of course, than what we are doing. We talk to them frequently and I know all the researchers there. That is a very good example. Canada has always been a leader in this area. I would say around the world we are recognized as producing competent, good scientists who are doing innovative things.
[Translation]
Senator Rivard: I have one last question. We know that Canada currently has free trade agreements, including NAFTA and possibly the European Union. Is this a good development opportunity for your industry, or could this field be excluded, for example, from the free trade agreement with the European Union?
[English]
Mr. Hall: No, I do not, because there is a lot of work being done in Europe, and in particular in Germany and Austria and the United Kingdom. There are several people who are beginning to produce protein-based drugs in plants. I do not think they will look at this as the same way they do with food with regard to genetically modified organisms. They will not look at it that way, in my opinion.
I think there is a wonderful opportunity here for liaising with both the Americans and the Europeans to do some great business and keep our innovations moving forward in Canada. I think this is a golden opportunity for Canada and actually the world as well.
[Translation]
Senator Maltais: It is always impressive to hear a witness of your calibre talk about research. Your comments raise a little optimism. With all of the cancers you are going to prevent, what will God have us die from in the years to come? The research exceeds the boundaries of the imagination.
Do the large pharmaceutical companies in Canada, not to mention those in the United States, work closely with you?
[English]
Mr. Hall: At this point, no, although we are talking to them. We are in the phase of beginning to speak with them and move forward. I know some companies in Toronto are looking at producing perhaps some antibody-based drugs as biosimilars, but they want to do it in animal cells. Yes, we are beginning conversations with them, but we have not —
The Chair: Dr. Hall, do you hear us? We have lost him.
Dr. Hall, do you hear us?
Mr. Hall: Yes, I can hear you now.
The Chair: Do you want to try the answer again, please? That was a good question, and we were getting a very good answer.
Mr. Hall: I cannot remember the question. Could you give me a refresher there?
[Translation]
Senator Maltais: My question is the following. Is there an interrelationship between the large drug manufacturers in Canada and your research centre? Is there a joint plan?
[English]
Mr. Hall: We think so, yes, but we do not have one yet. However, we are talking, as I said earlier, to companies in Canada, as well as the United States and Europe. They are hesitant in some regards to get into this at this point. Many of them are moving in the direction of doing it in animal cell production and making a biosimilar themselves to Herceptin. They are interested in what we are doing, but they have not signed on the dotted line, so to speak, an agreement with us.
[Translation]
Senator Maltais: A correlation exists between the products you are developing and the natural products on the market. In the larger drug stores, we find a section for high-quality pharmaceutical products, as well as a display of natural products.
How is all this selection useful? How are we to navigate this maze of choice? If we take one of each kind of pill, we might not be cured, and if we take the wrong one, we will remain sick. What is the relationship between what is natural and what is biological?
[English]
Mr. Hall: The biological drugs we are making are simply produced in living organisms, and they are required to go through the regulatory process, as would any drug that you currently are putting on the market for use in a medical application. The regulatory process will be very similar to that which is required for pharmaceutical-grade drugs. We could not put this on the market as a holistic remedy. In our opinion, that would be unethical. We are going through the process of regular drug approval. The only thing different here is the fact that it is coming from the plant instead of the animal itself.
[Translation]
Senator Maltais: This means that your future clients will be hospitals?
[English]
Mr. Hall: Yes. All our future clients will be, as they are now, in the traditional, regulated drugs. They would be hospitals and physicians, and they would have to be prescribed by prescription.
Senator Mahovlich: When you say ``regulated drugs,'' does every country have its own regulations?
Mr. Hall: Yes. Pretty much every country does, although they are streamlined, of course, in the EU. Canada, the United States and most countries have their own regulatory process.
In saying that, Canada and the United States and Canada and Europe share some harmony with regard to cross- talking, reducing the amount and not duplicating efforts a great deal. These agencies are always cross-talking and looking at one another's data, and they try to work together as much as possible and make their regulatory system as similar as possible to meet, of course, the needs of the people of that particular country.
Senator Mahovlich: Emerging countries such as China would be a large market. Would we be looking at China's regulations at all?
Mr. Hall: Yes. China, and all of Asia, is a huge market to be tapped. We are talking to people in India right now, and we are looking at doing a project — a more research-based project — through the national Centres of Excellence. They have a call for proposals from companies for liaising on research, such as what is going on between Canada and India. We will enter into that. We are talking, and I actually spent four months in India. While I was there, I was talking to Indian drug companies about getting a liaison. We have also talked to companies in other parts of world. This market is huge.
Senator Robichaud: You mentioned that we have the capacity here in Canada to produce the plants. You are talking about greenhouses. Have the people who operate greenhouses been approached to be part of your process or to grow the plants that you need, or are the plants you are growing on the university campus just for the needs of the university and your research?
Mr. Hall: At this point, everything has been grown on the university campus, except for the multiple 50-kilogram runs that we did in the United States, at Kentucky BioProcessing. However, could we do this in Canada? Absolutely. We have the expertise to do it, and we have the greenhouse controlled-environment sector to do it.
Senator Robichaud: My obvious question is: Why are we not doing it? Is it quite an expense for the operators of the greenhouses to retool or to do something special so that they can produce what you need?
Mr. Hall: Yes. It is premature in terms of large production facilities and multiple growers growing these things in Canada. It is too early. First, we want to get this drug registered and then bring the other three along and follow along with others. I see this as an expanding industry in Canada. It will start out small, but it will get bigger over time. . It does not have to be just drugs that we are producing this way. As other witnesses will tell or have told you, there are other things that can be produced in plants — other types of proteins, enzymes, et cetera — that will be produced in plants in the future. It is a real opportunity for us to get in on the ground floor.
As I tell my students, we missed the first revolution in the drug industry in small molecules because that occurred towards the end of the 1800s and the early 1900s when Canada was really a very young nation and was not really ready to compete there. This is a wide open door to get into the next phase of the drug industry, to get Canada in on the ground floor, producing, in Canada, products that can be sold around the world, by an industry that is wholly owned in Canada. That is the vision I have personally.
Senator Robichaud: What kind of recommendations could you suggest that we include in our report so that we do not completely miss this opportunity and get in at the earliest stages?
Mr. Hall: The first thing I would say is that I think we have the agencies to do it. We are talking to some of them. However, they are very reluctant, at times, to support the research. You get the line, to put it simply: Come back when you get the drug registered. We always want to laugh, but, of course, we do not. Once it is registered, get in line. It is a done deal. We need to get it to the point where it is registered, and that is the difficult part.
To be fair to some government agencies and to the private sector, this is a high-risk operation. When you talk about biotech, they are very skittish. I would think that this system that we have here is proven. The beauty of what Don Stewart brought to us to start this company is making biosimilars, not trying to make an innovator drug and spending 5 to 10 to 20 years in the lab but making these biosimilars that have already been proven. All we really have to do is wait for them to come off patent and be ready to move into the marketplace. Of course, there will be competition, but these marketplaces are huge. One of the other senators referred to 200 billion by 2020. Those are real numbers. It is a huge industry.
Senator Buth: I will come back to the same line of questioning as Senator Robichaud. Is it venture capital, essentially, that is stopping you right now from having further development in Canada and keeping these jobs in Canada?
Mr. Hall: Yes, finding venture capital is difficult. We have raised close to $2 million. Most of that has been from people like you, who are interested and who we have approached; they are willing to put in $25,000 or $50,000 into this for a percentage of the company. However, in terms of getting large commercial and large venture capital money, we are working hard to do that. We have not scored yet.
There are many people out there pounding on the doors, like us, so it is a very tough go and a tough sell.
The last thing I would say is that this is a no-brainer for me. We can do this. We can produce this drug. Of course, I know that, but, if no one else believes it, it will not happen.
Senator Eaton: Obviously, there is huge export potential. Is EDC someone you could approach? Are they not supposed to be into the venture capital business a little bit?
Mr. Hall: Yes. We are approaching all of these people, and we are talking to them. Sometimes they are a bit reluctant or slow to get back to us. Again, I could criticize them for that.
Senator Eaton: I am not asking you to criticize them.
Mr. Hall: Again, a lot of people are pounding on their doors and seeking funding.
Senator Eaton: Yes. We will do our best in our report because we are all very impressed.
Mr. Hall: Thank you.
[Translation]
Senator Maltais: Have financial institutions, the large banks or other institutions, that handle capital in Canada, shown any interest in you?
[English]
Mr. Hall: Yes, and some are doing due diligence on us as we speak, as well as large financial institutions outside Canada. We have a number of them doing a due diligence process with us now and checking our processes and financial background, et cetera. Yes, there is interest.
[Translation]
Senator Maltais: If the products you discovered or are now discovering that you want to put on the market, if they are truly all right, large capital will take an interest in them. I am thinking about the MasterCard company, which could give you a hand financially in terms of the interest it charges. This might be one means of financing.This is venture capital. Science is risky. But you have made the discovery, and so all that remains is to put it on the market. Overall, it is venture capital with less risk than other capital. So the large institutions would do well to show interest in you because they will benefit from the money too.Naturally, the government should do its share, which is only normal and fair.
[English]
Mr. Hall: My colleagues in the company spend most of their time approaching these companies. The advantage at our company is our excellent board of directors with a well-established track record in Canada, the United States and Europe. Our burn rate, so to speak, is very low. No one is taking salaries. Everyone is out there working and approaching those institutions that you are talking about. We hope that some things will come to fruition.
Senator Robichaud: You said that your team is putting quite a bit of effort into meeting with investors. How much of your team's time is spent looking for investors compared to the time spent by the team that does the research?
Mr. Hall: We have two teams. We have a research team of about eight that is working full speed; and we have about four people out there full time trying to raise capital. Don Stewart, CEO, is out all the time; as are David Cayea, Director of International Relations; and Ron Hosking. Mark Goldberg or I will go with them sometimes, when required. Those three are working 24 hours a day. They go to the United States and Europe. Currently, they are in the United Arab Emirates talking to a large banking institution.
Senator Robichaud: I wish you a lot of success. My hope is that somehow we can find a way for those products to be developed and marketed in Canada so that people in agriculture get a chance to get in on the production phase of the plants. The best to you, sir, and your team.
Mr. Hall: Thank you very much.
The Chair: Dr. Hall, I would like to have your comments and opinion on what you see, if you make a recommendation to this committee, as the role of governments. When I say ``governments,'' I refer to local, provincial and federal governments, as well as international agencies.
What would you recommend to this committee as the role of these partners in terms of investment, regulation, commerce and helping you to market the products?
Mr. Hall: Simply put, the valley of death is the difficult area. The support up to the end of applied research is very good in Canada. The government should be applauded for all the efforts they have made and continue to make in that area.
We have the sophisticated business community to take up these ventures, et cetera. However, going through the regulatory phases, Phase I, Phase II, Phase III trials of drugs, is really where we are having the trouble and is the place where we really need help. We need help not only from government but also from the private sector. If government puts some of their ideas together in this ``valley of death,'' to help us through that, other people as well, it would be very important. I know it is difficult and government should not do it all alone. Some of the people within government need to think a little bit more about this. I know it is a difficult area for them, and I do not fault them to this point. I am not laying blame, but it is something they need to look into more.
The Chair: Do you have opinions on the following: Do you have a role to play in the automobile and aerospace industries in terms of their composite parts?
Mr. Hall: No, we do not. However, I will tell you that we have done studies on all the products that come out — the by-products from tobacco — with both the Canadian and provincial government. We have looked at producing energy through bioreactors and things like that. We have done that, but nothing in the automobile or aerospace industries.
The Chair: Dr. Hall, thank you very much for enlightening the Standing Senate Committee on Agriculture and Forestry and for sharing your knowledge, your passion and your vision. Let us say to the University of Guelph: Continue your leadership.
Dr. Hall, do you have closing comments?
Mr. Hall: It is a real privilege and honour to speak before you; and I thank you for giving me the opportunity.
The Chair: Honourable senators, we will now hear from our second witness, Dr. Peter Pauls, Professor and Chair, Plants & Agriculture Department, University of Guelph. Dr. Pauls, thank you very much for accepting our invitation via video conference, and I will introduce myself.
I am Percy Mockler, chair of the committee, a senator from New Brunswick. I will ask the other senators to introduce themselves and then you will make your presentation, Dr. Pauls, and it will be followed by questions from the senators.
[Translation]
Senator Robichaud: Fernand Robichaud, Saint-Louis-de-Kent, New Brunswick.
[English]
Senator Mahovlich: Frank Mahovlich, Toronto, Ontario.
Senator Buth: Good morning. JoAnne Buth, from Manitoba.
Senator Eaton: Good morning. Nicky Eaton, from Ontario. Welcome.
[Translation]
Senator Maltais: Ghislain Maltais, Quebec.
Senator Rivard: Michel Rivard, The Laurentides, Quebec.
[English]
The Chair: Dr. Pauls, I will now invite you to make your presentation.
K. Peter Pauls, Professor and Chair, Plants & Agriculture Department, University of Guelph: Good morning honourable senators. I would like to thank the committee for asking for my input on using plants to manufacture pharmaceuticals.
I will begin by giving a thumbnail sketch of our department. We are one of six departments and schools in the Ontario Agricultural College of the University of Guelph. Our department consists of 33 faculty, 40 permanent staff, 60 contract staff, and 110 graduate students.
Our strategic plan indicates that our core purpose is to improve life through innovative science and teaching. We teach students in the Bachelor of Science agriculture, the Bachelor of Science biology, and teach two-year diploma turf grass management. The area of emphasis of our graduate programs are plant physiology, genetics and breeding, crop production and management, and we are developing something in bio-products as well.
Our research interests are grouped around plant breeding, crop production, both in the field and greenhouse, molecular and cellular biology as they relate to agricultural traits, and agricultural bio-products. The crops in which we run breeding programs include soybean, corn, cereals, forage legumes, dry beans, asparagus, native flowers, strawberries, nut crops and fruit crops. The department's research envelope is approximately $16 million, in a total university research envelope of about $120 million per year.
My own research includes plant molecular biology, plant genomics, and plant tissue culture, including plant tissue culture for the production of plants with novel traits, more colloquially called GMOs or genetically modified organisms, and plant breeding.
To address the question of the committee, I believe that the use of plants to manufacture pharmaceuticals is a technology with great promise to develop new markets for Canadian agricultural technology and ingenuity, and enhance agricultural sustainability. However, in spite of significant advances in the technologies that drive this area, it is an unrealized potential.
In its simplest form, plant pharming, spelled P-H-A-R-M-I-N-G, involves using plants or plant cells to produce medically important peptides and proteins like insulin or antibodies against diseases or toxins.
From a technical point of view there are many compelling reasons for using plants as bioreactors to produce pharmaceuticals, including that plants are able to faithfully reproduce the protein sequences coded by genes from a variety of non-plant sources, including humans. There is good potential to produce enormous amounts of proteins cheaply, since the inputs are normal agricultural inputs like fertilizers and sunlight, and the production systems do not contain potentially infectious agents like viruses and prions.
The work in this area has been conducted for more than 10 years in various parts of the world, including Canada. Specific examples include pharmaceutical proteins such as antibodies, edible vaccine candidates, enzymes, hormones, cytokines and growth regulators. The technical issues around this technology, including levels of production, glycosylation and purification have been largely solved in the last 10 years.
Some of the products have entered clinical development and they include gastric glypase lipase for treatment of cystic fibrosis, glucose cerebroside for the treatment of Gaucher's disease, Isokine growth factors for research, anti-inflammatory molecules like Lactoferrin and lysine, plant-derived monoclonal antibody, HIV antibodies, insulin produced from safflower, which is by a Canadian biotechnology company called SemBioSys Genetics.
As you just heard from Dr. Chris Hall, there is a version of a breast cancer drug of Herceptin by the Guelph-based company PlantForm called trastuzumab. This has properties that are very similar to the current pharmaceutical, with a current worldwide market of $5.7 billion.
I am unclear about the reasons for this being unrealized potential for this technology in Canada, or the rest of the world, but they may include lack of angel investors at crucial stages of company development. For example, on April 4, 2012, SemBioSys Genetics Incorporated announced it has applied to voluntarily delist its common shares from the Toronto Stock Exchange. They cited it was due to the current financial situation and perhaps excessive regulation around the technology.
For example, although there are more than 100 plants with novel traits that have been deregulated by CFIA since the early 2000s, the CFIA fact sheet, entitled Plant Molecular Pharming, states that in Canada there has been no commercial production of plants with novel traits for plant molecular pharming. This means that these plants are still in the confined research trial stage under CFIA oversight and cannot be released into the environment for commercial purposes.
The Government of Canada is investigating policy options for commercial plant molecular farming. To this end, CFIA is developing appropriate rules for commercial release of these plants. That is dated modified 2012/05/24.
Those are my comments. I am not personally involved in this area other than, as I mentioned before, I do work in the area of developing genetically modified plants. In our case, it is for research to look at, for example, reducing disease incidence in plants.
The Chair: Thank you, Dr. Pauls. We will ask Senator Buth to start the questions.
Senator Buth: Thank you, Dr. Pauls, for being here, or not being here but being there. Just as a follow-up to some of the discussion that we had with Dr. Hall, you did mention symbiosis and the difficulties in terms of commercialization. I understand that you are involved on the front end in terms of the research piece, but where do you see things going from the research end if the research is done and then there is not an ability to commercialize?
Mr. Pauls: Are you asking what implications that will have on research or the other way around?
Senator Buth: What implications?
Mr. Pauls: In terms of commercialization?
Senator Buth: Why would we bother doing the research if we cannot commercialize?
Mr. Pauls: That is a question, and that has probably discouraged a number of researchers in this area. Of course, they see the hurdles that confront them in terms of trying to get that research to make a difference in the long run.
There is much to be learned, and I would not say any of the research so far has been wasted. There were a number of technical difficulties around levels of production of proteins in plants, some differences between the molecules when they are produced in plant systems compared to animal systems and just the ability to purify afterwards to the level that is required for a pharmaceutical. All that research has happened in the last 10 years. However, as I mentioned, there are a number of potential products at the stage where they are at the transition now to really be considered as bona fide pharmaceuticals, and there is probably impatience to move and to actually have a success story to talk about.
Senator Buth: What about regulations for plants with novel traits and plant molecular farming? Do you see that as being an impediment in terms of where we are with regulatory approval for molecular farming right now?
Mr. Pauls: As I stated, from CFIA's own directive around this area, it seems like there is no clear path at the moment for commercializing material, particularly if the plants are to be grown in anything but a strictly confined growth system, so taking the plants down into mines or taking them into greenhouses that are highly-regulated in terms of what goes in and what goes out. I think the original dream was to actually grow them out in the field and enjoy the simplicity of growing crops that produce these high-value, novel materials. That certainly has not been realized.
Senator Robichaud: Following on Senator Buth's line of questioning, you mentioned excessive regulation. What do you mean by that? Is that from CFIA or from some other agencies? Would you enlighten me, please?
Mr. Pauls: CFIA would be the organization that regulates it initially, and if it shows potential and actually is used, then Health Canada and other agencies would become involved. Initially, CFIA would regulate the production of a transgenic plant.
I should mention there are alternatives to actually producing a GMO, and that is expressing the protein in a carrier like a plant virus. You would not actually produce a plant with novel traits, but in the end it is almost the same. You are producing the protein in the context of the plant cell system.
Maybe ``excessive'' was a bit strong, but I have been in this area for quite a number of years, and we just always seem to be close but not quite there in terms of seeing a commercial reality from the work that is being done. The reality for GMOs in Canada and I would say almost all countries in the world is that unless it is driven by fairly large companies, you are unlikely to commercialize a genetically modified plant. There are very few cases where they have come from a public institution.
Senator Robichaud: There is a lot of work to be done, then, because you say you seem to be very close but then it is still a little farther, is it not?
Mr. Pauls: Yes, and around the area of pharmaceuticals, you can understand that you want to have good oversight. You do not want to release a plant that may have a pharmaceutical that somehow escapes from our control in terms of the management in the field. The caution is understandable. I may be reflecting a little bit the impatience of a scientist to want to see the work that people have invested to actually be beneficial to people.
Senator Eaton: Professor Pauls, are you familiar with MaRS in Toronto and the concept of MaRS?
Mr. Pauls: I know of it, yes.
Senator Eaton: Why could something like MaRS not be applied or be useful to you if you are producing bio drugs? Are not they in the business of commercializing medical research?
Mr. Pauls: Yes, I think so. In fact, the University of Guelph did have a sort of satellite version of MaRS to focus on the opportunities related to where the agriculture end and pharmaceuticals intersect. Probably their expertise in clinical trialing and things like that would complement expertise here in actually producing the material. At the moment, I do not know whether Mr. Hall's company has engaged MaRS in a specific way. That I do not know.
Senator Eaton: We have been talking about GMO products in terms of trade and future free trade deals with the EU, Korea, Japan and India. Talk to me about your own research. Are you only dealing with GMOs in relation to biopharmaceuticals, or are you doing research in GMOs for other reasons, in other directions?
Mr. Pauls: I mentioned that we are doing research with GMOs for other reasons, for example, looking at expressing proteins in corn that would reduce the levels of fungal toxins in corn products because they are infected with fusarium fungus. It is that kind of work that we are involved with, so it is involved in the technology of producing GMOs. We have used the CFI regulations to test those materials in the field, in confined field tests, so I am familiar with actually taking material to the field and testing it at that stage. As I mentioned, the reality of then going to the commercialization stage is that there are very few examples of where that whole discovery and commercialization has happened in a public institution.
Senator Eaton: Is your research into GMO corn helped or hampered by our trade deals? In other words, if the European market does not like GMO seeds, does that hurt you, or does that not impact you?
Mr. Pauls: In some crops, it is not problematic. For example, GMO corn and soybeans are marketed throughout the world, so there are markets for them, particularly since many of the components are extracted. Oil from GMO soybeans is accepted in jurisdictions where they will not grow GMO crops. The oil does not retain that characteristic, so it is not a problem.
I am involved in the breeding of dry beans, phaseolus vulgaris. It is the pork-and-bean kind of bean, not the soybean, and our major market is the United Kingdom. We do not work with any GMOs in dry beans because we know that they will not be accepted. Eighty per cent of our production in Canada is marketed in Europe, so we do not work with GMOs. That is an example where the market dictates that we are not going to use that technology.
Senator Eaton: That does impact your long-term research?
Mr. Pauls: It does. We make decisions based on whether it is actually going to make an impact. Will it be useful? It affects you on a personal level. It also affects when I apply for grants. If I cannot justify that it actually is going to be utilized, then it is hard to make the case for the grant application.
Senator Eaton: What about your corn and fusarium? Will that be hampered by trade deals, or do you think that corn oil will not carry the properties of a GMO seed?
Mr. Pauls: Corn oil or corn starch would not carry the properties of the GMO seed.
Senator Eaton: There could be a market for that?
Mr. Pauls: There could be a market for those, yes, in the same way that pretty much all of our canola in Canada is GMO and is marketed throughout the world.
Senator Eaton: We have our canola expert, Senator Buth, next to me. Thank you very much, professor.
Senator Mahovlich: Some of the wealthiest companies are in the United States. They are drug companies. If you turn on ABC News at 6:30 or NBC or CBS, they all advertise drug companies. I watch those ads for hours, and they are for drug companies. Have these companies been approached when we are close to getting a regulated drug and need some financing?
Mr. Pauls: I do not know if I can speak from experience there. Dr. Hall would be the person who has first line experience in terms of trying to raise the money, but I think that interesting those companies in this technology has to be a common problem. I do not understand where the reluctance is, particularly around the kinds of pharmaceuticals Dr. Hall was talking about, which have proven efficacy. It is almost like doing the generic drug kind of work but on proteins.
I am surprised. I do not know the details there, sorry. I wish I could enlighten you there.
Senator Mahovlich: You are into plants. Where do trees fit into your program? Are they plants?
Mr. Pauls: Yes, they are plants. The difficulty with trees in this particular technology is that they have such a long life cycle. Let us say that you want to express in a peach. It takes several years until you get a decent crop. Something like tobacco, which, in a year, is a highly productive plant, is the better alternative.
Senator Mahovlich: A lot of our drugs come from trees.
Mr. Pauls: Yes, some of the specific compounds come from trees because of the complex biochemistry that trees do have, but, in this case, we are talking about a different class of compounds, which are the proteins. It is appropriate to use fast-growing, vegetative plants to produce large amounts of protein.
Senator Buth: Professor, I want to come back to the purpose of our study, which is looking at research and innovation. It is a fairly broad study, so it includes domestic and export markets, production and environmental sustainability. Based on what is happening in plant science at the University of Guelph, what would your top three recommendations for us be in terms of what the University of Guelph Plant Agriculture Department would need to increase farmers' profitability and environmental sustainability?
Mr. Pauls: Around this particular technology, I do think that a sustained examination of the blocks around the regulatory framework for plants that produce pharmaceutical proteins would be helpful because it seems like there is almost a moratorium around that technology, I am using strong words. I do not think there is, but, even in its own documentation, it indicates that the CFIA is not in a position to commercialize plants with these traits.
I think that we could do more work around the regulatory framework and explore the various issues that would need to be addressed so that we can move past the stage of promise to reality.
I think that perhaps there might be government investment in, as Dr. Hall mentioned, that stage around the commercialization. Actually, Canada does a good job in terms of matching private investment with incentives from government funding programs.
Perhaps one could explore specifically what the real hurdles are in moving material out of the laboratory into commercialization. I am sure there must be investment people who could give specific advice around mechanisms that would encourage that.
Also, there is a big public education piece here. We suffer from a public approach of suspicion to this whole area of GMOs. That is the reality. As a scientist, when I describe and talk about a technology, I want to give both sides of the story. I do not want to mislead people and say that this technology has no risks and that it is blue sky all the way. We want to give a balanced story. Somehow we need to get people to think that all the things they do in life are a balance of opportunity and risk. Some realism needs to be there around how cautious we are about working with these new technologies. Give real descriptions of the potential and the risks, but say: Okay, fine; there are some risks, but let us accept them for their potential benefits. Some of the drugs I listed might be called ``orphan drugs.'' There are people who could really benefit from having solutions to their medical problems through these kinds of technologies.
Senator Buth: Do you have any comments on whether that might be one of the impediments for CFIA moving to a more open approval system with these products?
Mr. Pauls: Definitely they have to be cautious; I totally agree. They are not advocates and they cannot be seen as advocates for a particular technology. I do not know where it needs to reside in terms of an organization that would talk about the benefits. For example, we talk about high-technology industries around electronics, aerospace and things like that. The reality is that planes fall out of the sky, but we accept that as a risk for the benefit of being able to travel around the world. There are agencies in the government that promote high technology; and this is another high technology. We need to be cautious and have appropriate oversight, but we also need to talk about some of the potential benefits of this technology.
Senator Buth: Those are interesting ideas. Thank you very much.
Senator Robichaud: You mentioned that you have to have faith. I am flying home tonight. You talked about planes falling out of the sky but I hope and have faith that I will get home because, on a percentage basis, it is a safe way to go.
Mr. Pauls: Right.
Senator Robichaud: We mentioned regulations. In Canada, do you have the same burden of regulatory practice or process as your colleagues in other countries? Is it more burdensome in Canada than it is in other places where they do the same kind of research that you do?
Mr. Pauls: I would not say that Canada is unique. I would have to go into some specific details to describe that there are differences. In fact, there are real differences in terms of how Canada finds a plant with novel traits compared to how some of the rest of the world does it. However, in practical terms, for scientists to move things forward, it is very similar, whether we are talking about the United States or Canada. The United States would probably be our closest comparator. The only difference is that in Canada we do not have the big seed companies based here that would be the kinds of partners that you would find in the United States or Europe. We have branch plant operations here, but we do not have the home offices in Canada.
The short answer is that in commercializing material, we face very similar hurdles, whether we are in Canada or in the U.S.
Senator Robichaud: When you say that the big companies do not have their main operations here in Canada, it is not a matter of influence with the regulatory agencies but rather a matter of putting more money into the whole process.
Mr. Pauls: Yes, that is right. We might not be the first place to go to if a company is looking for expertise in developing the next GMO crop. However, these large international companies look for expertise around the world. It is just a matter of where it gets commercialized first.
Senator Robichaud: Our committee is looking into innovation research in agriculture. This morning we have been talking about pharmaceuticals but also using plants. How do we marry the two and say: There is great potential for agriculture in your research. We are saying there is a lot of potential in the products that we produce from plants, but plants are a minor part of the process.
Mr. Pauls: As I said at the beginning, if the vision initially was to produce plants in the field, and one acre might be worth thousands, hundreds of thousands or even millions of dollars, it would certainly have an impact on agriculture. In Ontario, we have perhaps the highest concentration of greenhouses in North America, so the potential for using those greenhouses to produce high-value crops is large. We have the expertise in our people, who are doing innovation in greenhouses and the handling of plants in controlled-growth environments. There is real potential for an alternative crop in those existing greenhouses.
Senator Robichaud: From what I heard this morning, I believe that there is a lot of potential. However, not being an investor and not having the funds that you know you need I cannot be of much help. However, if I were an investor, I would be convinced that there is a lot of potential. There is much work to be done, is there not?
Mr. Pauls: We need the example of a really good success story to ignite the enthusiasm for the area to show that it can be done. It is puzzling that we are so close. In fact, the Calgary company, SemBioSys, is cited in the literature as being the one that would pave the way and give us that first example, and yet here we have this recent announcement that it is retracting again. It is puzzling why we cannot break through to the other side and be able to point to a Canadian company and say there is a success story and invite the others to follow.
Senator Robichaud: Your research is a success story, is it not?
Mr. Pauls: From the research point, a lot of the technical issues have been addressed and a lot has been accomplished, yes.
Senator Robichaud: However, we cannot measure success at this stage in how much profit it is generating for companies.
Mr. Pauls: No. We are not at that point. We have a lot of experience in commercializing. At the University of Guelph, we obtain about $700,000 a year in royalties from conventional varieties that we market. There is no problem in terms of expertise with commercialization of agricultural products. We just need a clear path in how to do that, knowledge that it can be done, and people show us the way to make that a reality.
The Chair: Dr. Pauls, how many universities across Canada have a program on agriculture plants to produce pharmaceutical products?
Mr. Pauls: It would be hard to answer that question with knowledge. You would find agricultural, plant-focused departments in Saskatoon, Montreal, and of course I want to mention Guelph. I think we have a lot of expertise in that area. SemBioSys is based in Calgary, so there is expertise there. There are not huge numbers.
There are other universities that would have particular researchers who might be working in bio-products and plant transformation, but I would say it would be in fewer than 10 places.
I forgot to mention that Toronto and Kingston also have concentrations of plant scientists who would be doing fundamental research that would lead to this kind of technology as well.
The Chair: I will have to share with you that Senator Eaton reminds us constantly about the leadership of Guelph.
By 2050, the world population is projected to reach 9 billion. How will this growth impact on the percentage of GMO products worldwide? Do you have a vision of what is coming and the role of GMOs?
Mr. Pauls: In spite of people's concerns about them, GMO technology is one of the fastest technology uptakes that has existed. It has been a success story around the world, and I think it will continue to play important roles in the future in feeding the world.
We need to move from the Model T GMOs to the next generation. We are still dealing, for the most part, with the first generation of GMOs, which were focused on productivity traits. The reason they were taken up so quickly is because they make a lot of sense to farmers. Therefore, it is not so much focused on the consumers, but it has been a technology that has been a success in terms of productivity, addressing exactly the question that you asked.
GMOs are not without their limitations, because, for example, the use of transgenics or GMOs that are focused on herbicide resistance has led to the increase in weeds with the same kind of resistance. There is no surprise there. However, the next generation of GMOs will address specific problems around drought and salinity tolerance and a whole range of quality traits that are focused more on consumer interests. If allowed, I believe they will play a big role in the future of feeding humanity.
The Chair: Senator Eaton just mentioned taste. What about the taste side of our products?
Mr. Pauls: There are people looking at the complex compounds that constitute taste and fragrance, and putting the fragrance back into flowers. As was asked, there is some understanding of the components of taste that give the complex biochemical range that a strawberry, a tomato, and fresh fruit and vegetables have.
The Chair: To link with Senator Mahovlich, we have seen in the previous report we have done on forestry that forest fibres were being used at another level of cellulose to produce rayon to become part of composites for car parts. In the future, do you see certain plants that would enhance penetrating the automobile, aerospace and the clothing industry?
Mr. Pauls: Yes. I do research and we have a bio-products discovery and development centre here at the University of Guelph. That centre is focused on the incorporation of plant fibres into plastics. The advantage is that the plant fibres are cheaper than plastic and are lighter, and so reduce transportation costs. That is a growing and developing area.
In fact, the technology we are talking about today could be used to express proteins, which might be silk proteins, and essentially produce fibres in plants that have almost tensile strengths like steel. There are certainly many opportunities for using plants in bio-product manufacture.
The Chair: Dr. Pauls, what about intellectual property? When you relate it to patents, what are the challenges when we look at agri-plant production for the new sectors?
Mr. Pauls: Some of the basic technologies around producing GMOs are based on patents that are held by some of the multinationals. In the past, they have been somewhat of an impediment. For example, golden rice, which was a development in Europe, intended to provide rice with high vitamin content for developing countries. There they negotiated with the multinationals to allow development of that particular product, without the royalty streams that they would normally get, so that that technology is available to people who critically need it. There are possibilities for working with patents and companies that hold patents so that these technologies may, in fact, have an impact.
The Chair: I was asked, and I went to visit, last Tuesday, in New Brunswick, and they related me to Saskatchewan, either Camerise or Camelina.
Mr. Pauls: Camelina.
The Chair: I guess it is Saskatchewan that is leading the way in Canada. I know that, in New Brunswick, potato producers are looking at that type of product because, as you just said, there is a higher yield, and it is all related to investment and the return on your investment, per acre. What is the future of Camelina for Canada?
Mr. Pauls: Camelina is an oilseed crop. It is remotely related to the oilseed that we call canola, but it is a very distant cousin. People are interested in it because it survives in low rainfall areas and also because it is not at the moment feeding into our food system. It is a way of using a plant for producing GMO products that are not directly in our food system, and it is a way of separating an industrial product from a food product that is not going to combine. It has good potential as an industrial crop in those areas, maybe even marginal areas, where we typically grow the oilseed canola.
The Chair: Dr. Pauls, the Standing Senate Committee on Agriculture and Forestry thanks you for taking the time to share your vision and enlightening the committee going forward with its report. Before I adjourn the meeting, do you have any final comments, Dr. Pauls?
Mr. Pauls: I would like to thank the Senate committee for asking for our input. There is a lot of potential in the various technologies around the use of what we like to call transgenic plants, plants that express novel genes for conventional agriculture but also in these very high-tech areas. It is a high-technology area. We would hope that, in the future, the general public gets intrigued by the possibilities and is able to balance the possibilities with the appropriate level of management and risk around such a high-technology venture. Thank you very much.
The Chair: Thank you, sir.
(The committee adjourned.)