Slides from a presentation given by David Glass, "Impact of Biotechnology Regulations on Use of Genetically Modified Algae in Biofuel Production", at the 2010 Algae Biomass Summit, Phoenix, AZ, September 28, 2010.

1. Impact of Government Biotechnology Regulations on Use of Genetically Modified or Synthetic Algae in Biofuel Production David J. Glass, Ph.D. D. Glass Associates, Inc. Algae Biomass Summit September 28, 2010

2. Biotechnologies Applicable to Biofuels Classical mutation and selection Plant breeding Recombinant DNA Directed evolution DNA shuffling Metabolic engineering Synthetic biology

3. Applications of Biotechnology to Clean Fuel Production Enhanced or engineered microorganisms for fermentation of ethanol, butanol, other fuels. Enzymes for fuel production manufactured using engineered microorganisms or plants. Selected or engineered plant species for use as improved biofuel feedstocks. Improved algal strains for production of biodiesel, jet fuel, ethanol, other fuels.

4. Genetic Engineering Strategies: Algae Enhance algal growth rate. Enhance or alter lipid biosynthesis. Enhance photosynthesis. Enable use of alternate food sources. Create new biosynthetic pathways. Enable secretion of lipids to aid oil/water separation.

5. Scientific Issues in the Regulation of Modified Algae Legitimate scientific issues need to be addressed for many projects involving modified algal strains. Stability of vector and introduced genes. Possible deleterious functions encoded by transgene(s). Potential for horizontal gene transfer, crossing to wild algae species. Potential for engineered strain to be transported outside facility, survive and compete in environment.

6. Overview of U.S. Biotechnology Regulation Environmental Protection Agency Microbial pesticides, plant pesticides. Engineered microorganisms used for other industrial purposes. U.S. Department of Agriculture Transgenic plants, potential plant pests. Plant-produced industrial products. Food and Drug Administration Foods, food additives, pharmaceuticals Possible applicability to algae TSCA biotech rule USDA biotech rule Product –specific regulation

7. Overview: EPA TSCA Biotechnology Regulations Regulations under the Toxic Substances Control Act (TSCA). Regulations cover industrial uses of “intergeneric” microorganisms not regulated by other agencies; e.g. industrial enzyme production, bioprocessing. Scope of coverage could include algae. Most research and pilot projects are not regulated if suitably “contained”. Commercial use or importation requires 90 day advance notification to EPA.

8. Overview: USDA Biotechnology Regulations Regulations issued in 1987 cover environmental uses, interstate movement of “potential plant pests”. Applicability to algae under current definitions not clear. Rules have generally not covered “contained” use of organisms in manufacturing. USDA has been considering revisions to the rule since 2007. Regulatory program being challenged in the courts over NEPA compliance.

9. Overview: FDA Biotechnology Regulations Engineered algae used for food, food additive, pharmaceutical production would be subject to FDA product-specific regulations. These regulations focus more on safety, efficacy of end product, and less on risks of production organism. Algae used for an FDA-regulated purpose would likely be exempt from EPA oversight under TSCA.

10. Regulatory Jurisdiction for Engineered Algae Proposed use of engineered algae by Mera Pharmaceuticals in pharmaceutical production in Hawaii in 2005 generated controversy, no federal agency claimed jurisdiction: state law and state courts ultimately determined outcome. 2008 USDA opinion letter to Coastal BioMarine stated no USDA oversight over engineered algal strain if no “plant pest” sequences, and no oversight for smaller-scale use in contained reactors. It is important to avoid jurisdictional disputes as the industry moves forward.

11. EPA TSCA Biotechnology Rule:“New Organism” Definition TSCA covers only “new chemicals”, so Biotech Rule covers only “new microorganisms”. “New microorganisms” defined as “intergeneric”: i.e., containing deliberate combinations of coding nucleic acids from more than one taxonomic genus. Many recombinant microorganisms will not meet this definition, and not be covered by these rules.

12. EPA TSCA Biotechnology Rule:R&D (“Small Quantities”) Exemption R&D uses of “new microorganisms” may qualify for exemption, if used “solely for R&D” in a suitably “contained structure”. Applicant must adopt procedures at the facility for controlled access, inactivation of wastes, emission controls, worker notification. Exemption could apply to R&D by for-profit entities, including pilot plants. Open-pond algae reactors may not be judged to be “contained structures”. Non-contained uses may require EPA notification, review prior to commencement.

13. EPA TSCA Biotechnology Rule: Microbial Commercial Activity Notifications (MCANs) Commercial use or importation of “new microorganisms” requires MCAN reporting at least 90 days before commencing commercialization or importing microbe. MCAN requires submission of data to EPA. Microorganism identity, construction and its properties. Information about the industrial process, control/containment measures, worker exposure, possible environmental release. EPA review, clearance of MCAN authorizes commercial use.

14. EPA TSCA Biotechnology Rule:Biofuel, Bio-Based Chemical MCANs 29 MCANs reviewed since 1997, including: Numerous MCANs for industrial enzymes. Modified E. coli and Klebsiella oxytoca for the conversion of lignocellulosic biomass sugars to ethanol (Verenium, 2008, 2010). “Biopolymer producing organism” for the industrial manufacture of a biopolymer (Company Confidential, 2008). Modified Zymomonas mobilis for cellulosic ethanol production (DuPont, 2009).

15. EPA TSCA Biotechnology Rule:Summary Most R&D would be exempt if “contained”. Commercial uses require 90 day advance notice. EPA has a track record in recent years reviewing microorganisms for use in biofuels, bio-based chemical production. EPA review considers risks and benefits. MCAN review clears the way for commercial use. EPA review is generally considered to meet requirements under NEPA, so Environmental Impact Statement not needed.

16. USDA Biotechnology Regulation:Scope of Coverage USDA Biotech Regulations administered by Animal and Plant Health Inspection Service (APHIS). Rules cover organisms that are potential plant pests, generally based on presence of DNA sequences from potential plant pests. Rules cover environmental use or interstate movement of potential plant pest organisms. Most submissions have been for transgenic plants, some for modified agricultural microorganisms.

17. USDA Biotechnology Regulation:Oversight over R&D R&D use covered only if in open environment. Notifications: 30 day advance notice. Permits: submit application 120 days in advance. Permits generally required for industrial uses. Submissions require: Description of host organism and genetic modifications. Description of field test; proposed procedures and controls. Assess environmental impact of field use.

18. USDA Biotechnology Regulation:Approvals for Commercial Use Approval for commercial use and sale through “petitions for nonregulated status”. Since early 1990s, USDA has approved 78 petitions to allow commercial sale of engineered crop plants. Approvals can take 1-4 years. Recent court cases have ruled that these approvals may require Environmental Impact Statements.

19. USDA Biotechnology Regulation:Summary Tens of thousands of field tests approved under these regulations – no approvals for algae? Limited experience with R&D permits for novel biofuel feedstocks, no commercial approvals. USDA likely to have scientific expertise to review biology of photosynthetic algae, but applicability under existing definitions unclear. Uncertain future for these regulations, due to ongoing rulemaking and court decisions regarding NEPA compliance.

20. Environmental Impact Statements? National Environmental Policy Act (NEPA) requires Environmental Assessments, Environmental Impact Statements, for “major federal actions”. Courts have ruled that product approvals under USDA biotech regulation require EIS’s. EPA actions under most of its regulations considered to inherently comply with NEPA requirements. Recent calls for DOE to conduct EIS for its program supporting algal biofuel research. Question: are EIS’s needed, and if so, when?

21. ABO Technical Standards Committee: Goals Published in Initial Draft Set the terms of the debate; encourage responsible, science-based regulation. Distinguish between different biotechnologies used to create organisms. Develop standards for data submission, performance of production facilities, organism containment. Develop a “road map” for regulatory approval of industrial uses of modified algae. Influence public perception.

22. ABO Technical Standards Committee: Challenges to Achieving Goals Biotech regulations use longstanding definitions to define which organisms are covered; would be difficult to introduce new classification schemes. Regulations differ in performance standards, data requirements and review procedures; standardization would be easier if one agency had sole jurisdiction. Growth of GM algae in open ponds. Public perception is critical. Although not as bad as the 1980s, there are still many vocal critics out there.

23. Impact of Biotechnology Regulations Efforts to promote standardization, interagency cooperation are important to ensure a science-based regulatory framework. However, the existing biotech regulatory framework provides a straightforward path to commercial approval, with many prior successes in agricultural, industrial biotechnology. The regulatory process can be successfully managed with proper advance planning.

24. Thank you very much David J. Glass, Ph.D. D. Glass Associates, Inc. 124 Bird Street Needham, MA 02492 Phone 617-653-9945 DGlassAssc@aol.com www.dglassassociates.com http://dglassassociates.wordpress.com