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Swiss ban biotech crops for five years
US food sector wants tougher controls on GM crops
Biotech sector value shrinks 40%
P&G gets qualified OK from Wella boards
WHO chews fat with food & drink makers
People
Caps guarantee use-by deadlines
Do as I say, not as I do
GM
Swiss ban
biotech crops for five years
Fears of potential cross-breeding
between genetically-modified and natural crops has prompted Switzerland's
lower parliamentary house to ban farming of genetically modified crops for
five years. The ban was tagged onto an agricultural funding bill voted
through last week. The decision reverses last October’s rejection of the
ban by the whole Swiss parliament.
US food
sector wants tougher controls on GM crops
US food manufacturers want more
stringent and comprehensive rules to prevent the US food supply chain from
being contaminated by genetically-modified organisms grown for non-food
uses.
The manufacturers’ trade
association, the Grocery Manufacturers of America (GMA), and 10 other food
and beverage bodies told the US Department of Agriculture (USDA) that
America needs a “comprehensive regulatory system to address the
challenges presented by the development of plant-made pharmaceuticals
(PMPs) in order to guarantee the safety and integrity of the food
supply”.
GMA repeated its support for
bio-drugs as a cost-effective method to provide Americans with the
medicines and vaccines they need. But it said these advances should not
sacrifice the safety and integrity of the food supply chain.
In early March the USDA announced
new conditions, including larger barrier spaces, for PMP field permits.
This followed legal actions against companies that breached the conditions
last year.
Others signing the response were
the American Bakers Association, the Biscuit & Cracker Manufacturers
Association, the Food Marketing Institute, the Institute of Shortening
& Edible Oils, the International Dairy Foods Association, the National
Confectioners Association, the National Council of Chain Restaurants, the
National Restaurant Association, the National Soft Drink Association and
the Snack Food Association.
Biotech
sector value shrinks 40%
Global economic uncertainty, a
pending war with Iraq and a bear market, pushed down the value of the US
biotech industry by 41 percent to $224 billion on 31 December 2002. This
is less than half its Q12000 peak of $490 billion.
“The industry became leaner,
meaner, and in some ways stronger than any other time in its
history," noted Steven Burrill, author and chief executive of Burrill
& Company, a San Francisco-based life sciences merchant bank which has
just produced its 17th annual report on the sector.
"The ImClone debacle delivered
a huge blow in January and investor confidence continued to tumble.
Announcements of restructuring, upper level management changes, delistings,
and bankruptcies eroded faith further," he added. "But the
industry has rebounded, and market capitalisation at the end of April was
$259 billion, up 15 percent for the year."
Burrill said revaluation and
restructuring touched every aspect of the biotech industry. “We saw the
FDA undergo significant restructuring and finally gain a new leader, Mark
McClellan. We saw the president and Congress move on national security
with the promise of infusing billions of new R&D dollars into biotech
for the provision of novel antibiotics, vaccines, diagnostics, and other
countermeasures against bioterrorism. We also saw the industry move
forward from a product development standpoint, advancing hundreds of
compounds through later stage clinical trials."
Burrill noted that 50 years after
Watson & Crick’s Nature article, the evolution of
technologies driving the biotech world has been “phenomenal”.
"First draft sequences of the mouse, malaria and rice genomes were
completed. Great strides were made in the war against cancer, HIV/AIDS,
and infectious diseases. Big IT companies like IBM made big commitments to
life sciences, but the way was very difficult for the platform
companies."
The application of biotechnology to
traditional and novel manufacturing processes, industrial biotechnology,
came into its own in 2002. Most of the traditional chemical industry
giants embraced biotech in a big way. "Harnessing naturally occurring
enzymes and microbes to produce fuels, plastics, textiles, and
biomaterials for reconstructive surgery, to name but a few applications,
has captured the attention and approval of the OECD, many environmental
advocacy groups, and the Department of Energy," Burrill said.
"Even the President made a pledge to increase investment in the
science and technology necessary to enable to next generation of
hydrogen-based products like fuel cells."
Burrill noted that the mood outside
the US was as bad. "Global insecurity as well as the weak capital
markets had the same chilling effect in other parts of the world," he
said. "Most of the genomic-proteomic tool and data providers emerging
from the once well-funded regional biotech clusters in Germany struggled
for survival.
“But not all the news was bad.
Biotech gained momentum in Scandinavia's Medicon Valley, in Israel, in
Canada and in parts of Asia/Pacific where governments continued to spend
billions to ensure their place on the biotech stage," he said.
Burrill believes 2003 will be
better. "The market bottomed in August 2002 and in these first four
months of 2003 we've seen biotech's market capitalisation rise by 15.4
percent to $259 billion," he said.
"The industry's total
financing for 1Q03 was $1.64 billion compared to 4Q02 financings of $1.35
billion and 3Q02 of $1.09 billion.”
Burrill expects industry
consolidation to continue both on the biotech and the pharma side as
companies seek to increase technology integration, achieve dominance and
jockey for power. In the US players in the healthcare system have more
buying power than ever before. As a result, there will be more big
economic transactions where bundling and incentives extract the best bang
for the buck. The surviving technology platform companies are building
growing, sustainable businesses. They will gain value based on positive
revenue trends and earnings. Investor sentiment will turn positive once
they believe the tools companies have sustainable business models. This
will happen as companies increasingly integrate along the drug discovery
value chain.
There will be continued interest in
the intersection of biotechnology, information technology, and
nanotechnology. These are key to understanding biology on a systems level.
In addition, there will be more use
of toxicogenomics to rout out the losing compounds far earlier in the
discovery process, saving time and money in development. More money will
go biotech products to improve our "wellness," our food system,
our energy resources, and our environment. The link between diagnostics
and medical treatment will increase as major clinics pursue a more
personalised, information-based approach to treating patients.
Pharmacogenomics will continue to gain ground as a valuable tool first for
determining the best patient outcomes in clinical trials and ultimately
for building more tailored therapeutics.
“We will also see diagnostics
become less hospital-centric and more patient-centric in their product
development,” Burrill said. “We'll see increased interest in the use
of patient specific diagnostics and we'll see a rise in the number of
individuals who will be willing to pay for those tests out of their own
pocket.”
On the agriculture/biotech side, GM
acreage will grow. “We are likely to see more GM crops in South America
and in Europe as consumers and decision makers are educated about the
economic and health benefits associated with biotech products. But we are
still not out of the woods with the ‘plants as factories’ debate where
concerns about cross-pollination and the co-mingling of crops has folks
worried about inadvertently eating industrial enzymes or therapeutic
proteins in their corn flakes.”
The nutraceuticals segment will
continue to gain ground in 2003 as we discover more correlative evidence
that regimens involving herbs, supplements, and specific foods are very
adjunctive to regaining and maintaining health. “As we understand more
about how various active ingredients contained in plants and herbs affect
human health, we'll see more people embracing nutrition as part of their
overall health programme for ‘wellness’” he said.
He predicts that once the political
debate is over, money will pour into anti-bioterrorism research. These
will range from the discovery of new vaccines and therapeutics to the
development of powerful portable biosensors capable of detecting minute
levels of toxins. “The bioterrorism/biodefence spend will be a ‘moon
shot’ for the biotech industry and most of the R&D will be
applicable beyond immediate homeland security needs,” he said.
“Biotech is the one industry
poised to grapple with every major human and environmental challenge from
global hunger to global warming, “ he said. “It is daily breaking new
ground in human healthcare, diagnostics, agriculture, nutrition, energy,
industrial processes and materials, as well as the environment. This is an
extraordinary industry that is characterized by long timetables and high
financial risk. But investment in biotech is not just about money, it's
about humanity, health, and the preservation of the planet," he said.
Biotech 2003 Life Sciences:
Revaluation and Restructuring costs $295
plus shipping and handling, from www.biotechreport2003.com
or www.burrillandco.com.
Finance
P&G
gets qualified OK from Wella boards
US consumer packaged goods firm
Procter & Gamble received grudging acceptance of its raised offer for
outstanding shares from the executive and supervisory boards of German
hair-care group Wella AG. The boards accepted P&G’s offer, but
refused to recommend that minorities follow suit.
This means P&G may have to
sweeten the offer still more to persuade Henkel to go along. Henkel, a
maker of adhesives and owner of Wella rival Schwartzkopf, holds 6.9
percent of Wella.
Health
WHO chews fat
with food & drink makers
 World Health Organisation
director general Dr Gro Brundtland met food and beverage bosses last week
to discuss the growing obesity problem worldwide.
The move came as the WHO starts to
develop its global strategy on diet, physical activity and health for
member states.
The Geneva meeting discussed ways
the food industry could work with WHO to encourage healthier diets and
increased physical activity worldwide.
At the meeting were chief and
senior executives from Nestle, Unilever, Coca-Cola, Kellogg’s, PepsiCo,
Cadbury Schweppes, Compass Group, McDonald's, Yum! Brands, Mizuno Corp,
Pentland Group and Royal Ahold.
Brundtland said the meeting was
“a positive beginning”. Unhealthy diet, physical inactivity and
tobacco use are among the leading causes of cardiovascular disease,
cancers, diabetes, respiratory disease, obesity and other noncommunicable
conditions. These now account for 59 percent of the 56.5 million global
deaths each year, and almost half, or 45.9 percent, of the global burden
of disease. Most chronic disease problems now occur in developing
countries, she said.
The WHO expects to launch its
global strategy on diet, physical activity and health at the World Health
Assembly in May 2004. It will issue a draft of the strategy before the end
of the year for comment by all stakeholders.
Brundtland told delegates the WHO
would like companies to push smaller portions and to use less fat, sugar
and salt in their products. She also called for labels to provide clear,
informative, accurate and scientifically proven claims and benefits, as
well as potentially harmful effects.
She added she was particularly
concerned about the way food and beverage companies market their wares to
children. "We want food companies to reassess what they are marketing
to young children, and how they are going about it."
The WHO recently recommended that
consumers cut their daily intake of refined sugars to under 10 percent,
and to get no more than 30 percent of their energy needs from fats.
Industry bodies reacted negatively. Some threatened to get the US Congress
to cut US subsidies to the world body.
People
Barry Callebaut has made Richard
Crux (43) responsible for its consumer products business unit from 15
May. He will also succeed James Forman as speaker of the executive board
of Stollwerck.
NPD
Caps
guarantee use-by deadlines
Researchers at the University of
Salford in Britain have developed a biodegradable plastic closure that
seals the container once the contents are past their use-by dates.
The new closure is expected to find
its first users among pharmaceutical firms because many drugs are
ineffective or even dangerous after their use-by date.
Market
research
Do as I say,
not as I do
Manufacturers of beauty products
could do better if they listened harder to their retailers, says Klein
& co, a US specialist market research firm.
Some top cosmetics and toiletries
companies spend millions of dollars to reach consumers and maintain market
share, but are bad at getting the product into stores on time and in
volume, the authors say.
Kline & Co asked more than 400
retailers and direct sales reps to say what was important in their
relationships with their suppliers and to rate their performance against
these criteria.
The results showed gaps in service,
poor responsiveness to retailers' requests, and unimaginative pricing and
promotions, which includes advertising and couponing efforts.
"We were surprised to find
such a disconnect between retailers' expectations and some marketers'
performance in a few important areas," says Kline's Carrie Bonner.
Some firms like L'Oreal, Clinique
and Estee Lauder did well. But underperformers included Unilever and Coty.
While Unilever holds the lion's share of the market for several product
categories, the company received below-average marks across the board from
survey respondents. Retailers cited innovation, customer service, and
consumer and trade promotion as areas in which Unilever fell short.
"Marketers may need to find
out exactly what their customers' needs and concerns are," Bonner
says. "Some factors that we expected retailers to emphasise, such as
a decline in the number of store visits by manufacturer reps, were not
seen as very important, while others like staff education programs are
becoming increasingly important."
For more information on how to
subscribe to Beauty Retailing 2002: The Struggle for Retailing Success,
contact Carrie Bonner at T +1 (973) 435-3412 or E carrie_bonner@klinegroup.com. |
