United Nations University Institute of Advanced Studies (UNU-IAS)
And
Japan Bioindustry Association (JBA)ABS Case Studies

Note
The views presented in this document are those of the authors and does not represent orreflect those of the institutions they belong to.

Table of Contents

Preface
1. Introduction: Access to Genetic Resources, Benefit Sharing and its
Links to Traditional Knowledge and IPRs .................................................... 1
2. Japan’s Measures to implement the CBD and the Bonn Guidelines ................ 3
3. Global Trends of Natural Product-based Discovery in PharmaceuticalIndustry ...................................................................................................... 6
4. Case Study 1: Nimura Genetic Solutions: Collaborative Experience of aJapanese Company in Malaysia .................................................................... 9
5. Case Study 2: National Institute of Technology and Evaluation (NITE):
Collaborative Research Experience in Microbial Taxonomy with OtherCountries....................................................................................................11
Conclusions .....................................................................................................14
Contributors ....................................................................................................15

Preface

United Nations University Institute of Advanced Studies (IAS) and Japan Bioindustry
Association (JBA) have collaborated for the past several years to provide a platform to discuss andadvance ideas on emerging issues of global importance, in the context of access to genetic resources
and benefit sharing (ABS) under the Convention on Biological Diversity (CBD). This was primarily
done through symposia and roundtable discussions involving various stakeholders such as
governments, industry and NGOs.
In view of the forthcoming negotiations on international regime at the Conference of Parties (COP)in Bonn and subsequent meetings of the ABS Working Group, IAS and JBA have carried out
collaborative work on case studies of experiences in Asia in the implementation of ABS measures.
The case studies highlight different kinds of arrangements between countries in Asia that provide
genetic resources and Japan. It also focuses on ABS implementation in Japan and challenges facedby bio-industry through the example of current global trends in natural product-based drug discovery(NPDD). Through the case studies, this document seeks to facilitate informed discussions within the
CBD-ABS process. It is hoped that this document will help clarify some issues on challenges facedby ABS issues and how countries like Japan are dealing with these challenges – mostly using abilateral approach.

1. Introduction: Access to Genetic Resources, Benefit Sharing and its Links to
Traditional Knowledge and IPRs
The Convention on Biological Diversity
With the coming into force of CBD in December 1993, countries that are Parties to CBD
recognized the sovereign rights of states over their genetic resources. CBD provides an opportunity
for countries to address equity not only in accessing the genetic resources, but also in sharing thebenefitsarising out of their utilization. Of the three founding principles of CBD, i.e., conservation,
sustainable use, and equitable sharing of benefits, the issue of access and benefit sharing has been
the most challenging to develop and implement.

Outcomes from the World Summit on Sustainable Development (WSSD) in Johannesburg in
2002
Paragraph 42(o) of the Plan of Implementation of the WSSD recognised the need for countries to“[...]negotiate within the framework of the Convention on Biological Diversity, bearing in mind theBonn Guidelines, an international regime to promote and safeguard the fair and equitable sharingof benefits arising out of the utilization of genetic resources ”. Furthermore, paragraph 42 (j) of thePlan of Implementation calls for, subject to national legislation, the recognition of “the rights oflocal and indigenous communities who are holders of traditional knowledge, innovations andpractices, and, with the approval and involvement of the holders of such knowledge, innovations andpractices, develop and implement benefit sharing mechanisms on mutually agreed terms for the useof such knowledge, innovations and practices”. Thus, countries now have a mandate to negotiate aninternational regime, bearing in mind the Bonn Guidelines that were adopted by the Parties to CBD
in 2002.
These developments required countries to have a more clear understanding of the implications ofsuch emerging processes, identify needed capacities, assess national and regional scenarios in
deciding over ABS issues.
Evolution of debates
Access to Genetic Resources, Traditional Knowledge and Intellectual Property Rights (IPRs)
Article 15 of CBD calls for the Parties to establish systems and procedures for access to genetic
resources and fair and equitable sharing of the benefits, arising out of the utilization of genetic
resources. This provision gave rise to varied levels of understanding and interpretations of how
access is to be provided and what is equitable sharing of benefits.
Historically, two distinct periods can be considered- a pre-CBD period, when genetic resource
were largely considered to be part of the common heritage of mankind and deemed to belong toeveryone and no one at the same time. This principle – recognised in an international instrument as
part of the 1983 FAO International Undertaking on Plant Genetic Resources – helps explain the free,unregulated flows of genetic resources from continent to continent. Until 1992, the flow of and trade1

in biological materials worldwide was generally governed by international trade rules and practices(including trade treaties); phytosanitary measures in some cases; CITES regulations and, at thenational level, by scientific research, collection and export (import) permits.
Since the entry into force of CBD in 1993 that recognises the sovereign rights over genetic
resources, countries began focussing on ways of securing the resources using the ABS principles as
defined through Article 15. Implementation of Article 15 has to date mostly resulted in the
restriction of access than the facilitation of access causing concerns among scientists, business andothers on issues of collaboration, researchand commercialization. The period of early to late1990’s also saw the emergence of increased privatisation of knowledge and resources using
intellectual property regimes, supported by the Trade Related Intellectual Property Rights (TRIPS)
and the implementation of principles of World Trade Rules through the WTO process. Countries
began discussing the need for access to genetic resources for sustainable development, and acontentious scheme emerged on pitting biodiversity-richdeveloping nations against technologyrich developed countries in taking forward the CBD principles.
Benefit sharing
The past two decades have seen rapid developments in biotechnology and other related fields.
They have, at the same time, contributed to continued debates over the control of genetic resources
and use of IPRs over biological and genetic materialsand their derived products. A main challenge
in implementing the ABS principles under CBD is to determine how the benefits, in terms of sharing
research results, capacity building, monetary income, IPRs, etc., are to be effectively shared amongusers and providers of these resources.
Traditional knowledge
Discussions on ABS issues are often associated with knowledge of indigenous people and local
communities.

Such knowledge is generally called traditional knowledge (TK: “knowledge,

innovations and practices” as Article 8(j) of CBD refers to it). However, these discussions havefurther implications in the context of IPR with the limitations of available tools to handle TK. The
possibilities of effectively handling TK dominate certain political and legal agendas. The questionof how TK should be handled is still far from being answered. Possible solutions range from aninternational regime on sui generis system on TK, including non- IPR based options, to adapting
existing IPR tools,and a broad range of creative in-between options.
The Bonn Guidelines
The Bonn Guidelines on Access to Genetic Resources and Fair and Equitable Sharing of the
Benefits Arising out of their Utilization (adopted by COP Decision VI/24)are a set of voluntary,
non-binding guidelines targeted at assisting countries in the implementation of CBD provisions,particularly Articles 8(j), 10(c), 15, 16 and 19. The Guidelines are to serve as an input to national
and international ABS policy, administrative or legislative processes.

2

The Bonn Guidelines cover most, if not allof the relevant ABS issues. They offer different
alternatives which may be taken into account in national legislation.

It is noteworthy that asubstantial part of the Guidelines is based on existing ABS policy and legal instruments.
An International Regime on ABS
Discussions responding to the WSSD call for an international regime have to date taken place
within the CBD, in particular, the Ad Hoc Working Group on Access and Benefit Sharing. So far
these discussions have shown how complex the issue is and how varied the positions of different
countries are. It is hoped that constructive discussions will lead to a consensus on a workableinternational regime that is balanced, effective and internally consistent within the framework of
CBD. Achieving such an outcome will depend significantly on identifying best practices on ABS
implementation across the world. In the following sections, we highlight some experiences of theJapanese Government and industry on the implementation and realization of ABS measures.

2. Japan’s Measures to implement the CBD and the Bonn Guidelines
Japan has been actively participating in discussions on ABS at the meetings of COP of the CBD
and ABS working group meetings. Japan has also been making efforts to build mutually beneficial
relations with countries that provide genetic resources, by following carefully the national
obligations under provider countries on access to genetic resources and implementing fair andequitable sharing of benefits arising from the use of genetic resources in an appropriate manner.
The Ministry of Economy, Trade and Industry (METI) is a competent national authority on ABS
in Japan, and has been implementing CBD. On behalf of METI, Japan Bioindustry Association(JBA) has been implementing the Bonn Guidelines in order to help the private sector and thescientific community to continue to build a win-win relationship with other countries in compliancewith the CBD principles.1
Dissemination of the Bonn Guidelines in Japan
Soon after the adoption of the Bonn Guidelines in February 2002, JBA translated them into
Japanese. JBA disseminated the Bonn Guidelines (translated version) by organizing more than 8
public seminars in major cities across the country during 2003 and 2004. This helped to enhance theawareness of genetic resources users (e.g. companies and researchers) about the Bonn Guidelines.
As the Bonn Guidelines became better understood in Japan, a number of users expressed theirviews that descriptions of the Bonn Guidelines were often too general to be helpful for users ofgenetic resources to cope with their practical needs. They emphasized a need for user-specific anduser-friendly guidelines. Taking these requests and experiences into consideration, METI decided todevelop user-specific guidelines on the basis of the Bonn Guidelines to be used as Japan’s METI-

1

SUMIDA S. 2008. The experience from Japan. Business.2010, vol. 3(1): 10-11

3

JBA ABS guidelines. In consultation with experts from industry and academia, METI started
working on such guidelines in cooperation with JBA in 2004. In April 2005, “the Guidelines on
Access to Genetic Resources for Users in Japan” (abbreviated as Japan’s ABS Guidelines for Users)
were completed and published.
Development of ‘Japan’s ABS Guidelines for Users’
The Japan’s ABS Guidelines for Users aim to help both providers and users of genetic resources
to build win-win relationships, and to minimize the risk of getting involved in problems, while
ensuring business flexibility. To promote their dissemination, JBA held since 2005 more than 12
public seminars in 6 major cities across the country. Its English translation was completed in
February 2006.2
Chronology of the implementation leading to the Japan’s ABS Guidelines for Users is given
below.
2002

The Bonn Guidelines were adopted at COP6 in February.
In September, Japanese translation of the Bonn Guidelines was completed.

2003 – 2004

The Bonn Guidelines were disseminated at a series of public seminars andinternational symposia in major cities across Japan.
In parallel with those promotional activities of the Bonn Guidelines, Japan
started developing user-specific guidelines.

2005“The Guidelines on Access to Genetic Resources for Users in Japan” werecompleted in March, and published on April 1.
Six public seminars were organized in major cities across Japan to disseminate
the Japan’s Guidelines.

2006

In February, the English translation of the Japan’s Guidelines was completed for
distribution.
Four public seminars were organized in major cities across Japan to disseminate
the Japan’s Guidelines.

2007- 2008

Public seminars were organized in Japan, including the one in cooperation with
the Japan Society for Bioscience, Biotechnology and Agro-chemistry, and theone with the Japan Institute of Intellectual Property, to disseminate the Japan’s
Guidelines. More are scheduled to take place .

Support for users of genetic resources
On the basis of the Japan’s ABS Guidelines for Users, METI and JBA have developed a numberof tools to support users of genetic resources.
x

Bilateral workshops and meetings with CBD officials of providing countries:
In order to promote development of partnership between users of genetic resources andproviding countries, JBA and METI invited CBD officials (or experts) from provider countries toJapan for information exchange at public workshops or meetings. They presented information to the2www.mabs.jp

4

audience on their national policy, laws and regulatory systems relevant to ABS implementation. In
some cases, experts from JBA traveled to provider countries for information exchange and learn
about their national rules and procedures on ABS. So far, JBA and METI have held such bilateralworkshops or meetings with the following countries; Australia, Brazil, Bhutan, China, India,
Indonesia, Malaysia, Mongolia, Myanmar, Nepal, New Zealand, Singapore, Thailand and Vietnam.
x

JBA’s specialized website for ABS-related information on providing countries:
JBA created a Japanese-language website specialized for disseminating information on ABS-

related policy, laws and regulation of different countries, for users of genetic resources in Japan.3xJBA’s ‘Help Desk’:
JBA has been involved in the CBD matters since 1993. Based on this experience, JBA gives

advice on ABS matters to those potential users in Japan who have questions or problems, free ofcharge and on a confidential basis. Since 2005, JBA has conducted more than 90 cases of suchindividual consultation.
Group Training Courses in Bioindustries for Capacity Building
Japan International Cooperation Agency (JICA), supported by JBA, has been implementing“Group Training Courses in Bioindustries” for officials and researchers from developing countries.
Annually about ten trainees are invited to Japan for the two months course. The training course
includes lectures and field trips including hands-on experiences in a microbial taxonomy laboratory.
As an example, the program for 2007 is outlined below.
The topics covered during the training include:xConservation and sustainable use of biological resources:
Japan’s national policy on bioindustry, current status and future prospect of bioindustry, CBD,

risk assessment of biotechnology products, patents related to biotechnology, public understandingx

Evaluation of biological resources:
Applied microbiology, plant engineering, bio-active substances from biological origin,recombinant DNA technology, bioreactors, biotechnology-supporting technologies

xApplication of biological resources to industries:
Fermentation industry, biopharmaceuticals and diagnostics, new applications and potentialities ofindustrial enzymes, biotechnology for food industries, marine biotechnology, protein engineering,bioinformatics

Field trips included visits to the following institutions:xUniversities:
Hokkaido University, Kitasato University, Kyoto University, Nagahama Institute of Bio-scienceand Technology, Nagoya University, Nara Institute of Science and Technology, Tsukuba University,
University of Tokyo3

www.mabs.jp

5x

Public research institutes:
Japan Biological Information Research Center, National Food Research Institute, National

Institute of Advanced Industrial Science and Technology, National Institute of Agrobiological
Resources, National Institute of Technology and Evaluation, RIKEN Yokohama Institutex

Private companies:
Ajinomoto Co.,Inc., Amano Enzyme Inc., Astellas Pharma Inc., Kyowa Hakko Kogyo Co., Ltd.,

Meiji Seika Kaisha, Ltd., Mitsukan Group Corp., Shimadzu Corp., Suntory Research Center, Toyota
Motor Corp., Yotsuba Milk Products Co., Ltd.
To contribute to the development of human resources in bioindustries and to the promotion ofmutual understanding and friendship, since 1989 a total of 180 officials and researchers have been
invited to take the course in Japan from 30 countries as follows:(Asia) Bangladesh, China, Indonesia, Kazakhstan, Laos, Malaysia, Nepal, Pakistan, Philippines,
Thailand, Sri Lanka, Syria, Turkey, Vietnam,(Central and South America) Argentina, Brazil, Chile, Colombia, Costa Rica, Cuba, Mexico,
Nicaragua, Peru, Uruguay,(Africa) Egypt, Senegal, Tunisia, and(Countries in Economic Transition) Bulgaria, Estonia, Hungary.

3. Global Trends of Natural Product-based Discovery in the PharmaceuticalIndustry
Since 1990s, a number of major multi-national pharmaceutical companies have abandoned or
drastically reduced their activities world-wide in natural product-based drug discovery (NPDD). In
Japan for example, Pfizer in Nagoya, Bristol Myers Squibb in Tokyo, and Hoffmann-La Roche in
Kamakura closed their respective NPDD facilities in 1990s for one reason or another. Some ofJapan’s pharmaceutical companies also withdrew from NPDD during the same period, but others
have sustained their NPDD capabilities on a reduced scale. Major reasons given for these closures
are that there have been fewer commercial successes in NPDD in recent decades, and that newtechnologies other than NPDD have continued to emerge for curing diseases. For example, antibody
drug technologies have attracted the interest of some Japanese pharmaceutical companies forinvestment.

Furthermore, slow progress in national implementations worldwide of the ABS

provisions under the CBD has negatively affected the management’s incentives for investment in
NPDD, because of uncertainty about the regulatory procedures of a number of developing countries
that are potential providers of genetic resources.
The size of the world pharmaceutical market in 2005 was approx. US$ 600 billion. Japan’sshare was 11% of the world market, which was the second after the United States (44%).
Traditionally, Japan has strengths in microbial product-based drug discovery, as typically6demonstrated by a case of pravastatin, a blockbuster drug to cure hyperlipidemia.4, 5, 6 (see Box 1)
There is a background for it. Japan has a long tradition of fermentation industries (e.g. production of
sake, soy sauce, soybean paste, etc) using Aspergillus, Saccharomyces and other microbes. This
helped to nurture applied microbiology in modern centuries. For example, Jokichi Takamine, apioneer in biotechnology in both Japan and the United States, developed and patented microbial
enzymes for the first time in the world, more than 100 years ago. Modern fermentation processes foramino acids and nucleotides have bloomed in Japan since late 1950s. During the period when
research and development in antibiotics prevailed, Hamao Umezawa and his group were world
leaders. Discovery and development of natural product-based drugs require a wide diversity of
researchers in different disciplines. Success depends on well-organized collaboration between theseexperts rather than one genius. This type of research collaboration seems compatible with theJapanese culture.

Box 1

Case study on the discovery and development of pravastatin
In 1971, researchers of Sankyo (currently, Daiichi-Sankyo, a leading
pharmaceutical company in Japan) started a screening program in search of a drug
to cure hyperlipidemia (excess of lipids in the blood) by specifically inhibiting
mevalonic acid biosynthesis. They devised a cell-free system from rat liver tissues
with HMG-CoA reductase (a rate-limiting enzyme in cholesterol biosynthesis) as thetarget enzyme. After screening extracts from a numerous number of microbes byusing the cell-free system, they found an inhibitor of HMG-CoA reductase from theextract of Penicillium citrinum that was isolated from rice produced in Kyoto, Japan
in 1967. This (coded as ML-236B) was a specific inhibitor of HMG-CoA reductasethat was discovered for the first time in the world. The discovery made a historiccontribution to the basic research in anti-hyperlipidemia, even though ML-236B did
not proceed to a commercialization stage, as described below.
Sankyo researchers looked for compounds better than ML-236B from thestandpoints of tissue selectivity and the inhibitory potency. Luckily, they obtained ahydroxylated metabolite of ML-236B in a minute amount from urinary excretions ofa dog administered with ML-236B. This compound had properties that they werelooking for. This hydroxylated ML-236B was named as ‘pravastatin’. However,
because of its structural complexity, it was not practicable to synthesize pravastatin
by organic chemistry. The researchers thus faced another difficulty in preparing asufficient amount of sample to take the research forward for more detailed
pharmacological and toxicological studies.
The researchers decided to try microbial transformation for hydroxylation of ML236B into pravastatin. After extensive screening, they found that a fungus Mucor
hiemalis had an activity to enable the preparation of a sufficient amount ofpravastatin samples to continue further studies. With the samples prepared, theresearch proceeded with promising results. However, when it advanced to a stage ofmanufacturing process development, they found that Mucor hiemalis could not give
4

Guidebook for Access to Genetic Resources, June 1999, p. 40, Japan Bioindustry Association, Tokyo, Japan (inJapanese)
5
ENDO A. et al. 1976. ML-236A, ML-236B, and ML-236C, new inhibitors of cholesterogenesis produced by
Penicillium citrinum. J. Antibiotics vol. 29: 1346-1348.
6
OKAZAKI T. et al. 1989. Annual Report Sankyo Res. Lab. vol. 41: 123-133.

7

yields satisfactory for an industrial-scale production. The researchers decided to
conduct an extensive ‘targeted’ search for better microbes, and they finally isolated a
new species from an Australian desert, named Streptomyces carbophilus, that was
suitable for the industrial-scale hydroxylation step.
In 1981, a preclinical trial started, followed by a series of clinical trials whichwere completed in 1987. In March 1989, pravastatin was approved by the Japanese
health authorities as a new drug, and Sankyo launched it commercially with thetrade name of ‘mevalotin’. Pravastatin has since been used in more than 70
countries by over 4 million patients (as of 1999) to cure hyperlipidemia. It took
Sankyo 18 years and a half from the initiation of the screening program in 1971 to
the commercial launch in 1989, and consumed ingenuities and careers of a numerous
researchers to reach that goal.

Fig. 1. ML-236B (left) produced by Penicillium citrinum and its bioconversion
product by Streptomyces carbophilus, pravastatin (right)
Challenges to NPDD researchers
As the case study on pravastatin indicates, natural products have a potential to play an importantrole in drug discovery on a long-term basis. It can provide unique pharmaceutical leads. However,the corporate climate world-wide has not been favorable for NPDD researchers in recent years.
When a pharmaceutical company terminated its NPDD activities, the researchers of the NPDD groupeither got reassigned to completely different jobs within the company, or they had to leave thecompany to join or create other organizations (often small biotech companies) where they could
continue to use their expertise. In the former case, the NPDD expertise and know-how that had
accumulated in the company may have been permanently lost.

In the latter case, the NPDD

researchers could survive for the time being, but their future may be uncertain because small biotech
companies are often financially unstable. This situation means that natural product researchers are‘endangered species’. Since the potential of NPDD can be sustained by a sufficient number ofcompetent NPDD researchers, this situation also means that NPDD is an endangered field. This, inturn, means that the value of biological diversity for drug discovery may be endangered.
What is of great concern on a long term basis is that microbial taxonomy is not being actively
taken up by both universities and students in recent decades. NPDD has been supported by thesetaxonomists who isolate, select and identify a large number of microbial strains from nature. It isthese isolates that are to be subjected to screening assays. Nothing promising can reasonably be
expected from samples selected by untrained persons.
Scientific, technical, corporate and perhaps governmental approaches should continue to be
attempted to improve and re-invigorate NPDD. But, as far as the matter in the CBD context isconcerned, the stakeholders cannot afford to be adversarial to one another in handling ABS issues.
8Rather, it is to the benefit of all the stakeholders to promote NPDD, because NPDD can create
benefits for them by utilizing the value of biological diversity, and because, through this process, it
can contribute significantly to the improvement of human health. It is wiser for both providers andusers of genetic resources to cooperate in promoting and facilitating NPDD research for mutual
benefits.

4. Case Study 1: Nimura Genetic Solutions: Collaborative Experience of aJapanese Company in Malaysia
The case study highlights the experiences that Nimura Genetic Solutions (NGS)  , a privatecompany from Japan, has had with the Forest Research Institute Malaysia (FRIM) 8 and Sarawak
Biodiversity Centre (SBC) in Malaysia.
Malaysia’s national policy on biodiversity
Malaysia is recognized as one of 12 mega-biodiversity countries, holding approximately 10 % ofliving species of the world, e.g., with 15,500 species of higher plants, 300 species of mammals and
189 species of amphibians. Malaysia launched the national policy on biological diversity in 1998.
The policy provides direction for the country to implement strategies, action plan and programs on
biological diversity for conservation and sustainable utilization of its biological resources. To
provide a legal framework to the policy, three measures are either in place or a draft status, i.e. theBiosafety Act (in place), Access to Genetic Resources Act (draft) and the National Biodiversity
Council Act (draft).
The Malaysian Government is actively promoting biotechnology industry in the areas of foodand agro-biotechnology, bio-pharmaceuticals, nutraceuticals, bio-diagnostics, industrial enzymes,
and bioactive compounds for healthcare.

Malaysia still needs more expertise to exploit theseresources for wealth creation. Smart partnership with companies from developed countries is a way
to overcome these shortcomings. Malaysia welcomes collaboration with foreign institutions inorder to build the foundation for sustainable biotechnology industries in the country.
The business activities of NGSin Malaysia
NGS was established in 2000 with its head office in Japan and its major research institute in
Malaysia, with the objective of exploring bio-resources in tropical rainforests for new bio-active
compounds, in compliance with the CBD. The above-mentioned policy of Malaysian government
was one of the key reasons for NGS to start its activities in Malaysia. Research collaboration was
negotiated between FRIM and NGS. In 2002, NGS was granted the research and development right7

http://www.ngs-lab.com
Krishnapillay B, M.A.A. Razak and S. Nimura 2004. JBA/UNU-IAS Symposiumon “Access and benefit-sharingof genetic resources – experiences, lessons learned and future vision” , Proceedings –Update, Japan Bioindustry
Association and United Nations University Institute of Advanced Studies

89

for commercial use of Malaysia’s bio-resources from the Government of Malaysia through FRIM.
One of the NGS research facilities in Malaysia was established inside the FRIM campus in Kuala
Lumpur. The collaboration includes the utilization of microorganisms as well as plants as resources
for finding bio-active substances with medical and/or environmental potentials.
In 2004, NGS was granted the right to conduct similar activities by Sarawak Biodiversity Centre
in the State of Sarawak in Northern Borneo. Furthermore in 2005, NGS was granted full accessrights to all species inhabiting the Perak State primary forest near the Northern Malaysia-Thailand
border, through the collaboration between NGS and BioPERAK, a partially Perak state-owned
company.
The NGS laboratory located inside the premises of the FRIM has a space of approx. 460 square
meters. The laboratory is well equipped for drug discovery research utilizing bio-resources. Twenty
four people were recruited locally and young researchers trained on technologies for research in drug
discovery. A few Japanese expert researchers are attached to the laboratory at all times, and otherresearchers visit on a monthly basis from Japan to provide guidance to the staff on technical andother matters. NGS also invites prominent researchers from Malaysia or from other countries forperiodical forums and workshops organized by NGS for the purpose of technology transfer.
NGS’s business rationaleand outcomes
To conduct drug discovery research utilizing bio-resources in tropical rain forests, the following
parameters generally need to be taken into consideration: understanding of the CBD policy andregulatory systems of the country, negotiation with the government authorities (it may take 1-2 years
if started from scratch), setting-up of research facilities, recruiting of researchers and experts for
operation in the jungles, management of research team and facilities under the local conditions ofdifferent languages, religions, and cultures.
If a pharmaceutical company in Japan or elsewhere is interested in drug discovery researchutilizing bio-resources in tropical rain forests, there may be two options. One is to do it forthemselves. The other is to collaborate with an appropriate company which has expertise to do it forthem. Generally speaking, the second option seems more practical for Japanese companies, if thecost is justifiable. Since users want to keep as much business flexibility as possible, NGS hasvarious business arrangements available to fit each client’s need.
Outcomes of NGS’activities
NGS has a number of non-Malaysian clients from fields such as pharmaceutical and chemicalcompanies. NGS has started paying royalty from its revenues gained through research collaboration
with these clients. Moreover, NGS filed two patent applications for novel antibiotics together withFRIM in 2006.
Experiences and lessons learnedx

Confusion between legitimate bioprospecting and biopiracy is observed at grass roots level:
There is widely held view that foreigners and commercial people indulge in biopiracy. Rumors10

of biopiracy can have a dramatic impact on even well managed companies. The efforts of bothgovernment and companies are essential to prevent negative rumors and misuse of the word
‘biopiracy’. NGS has so far been able to solve this problem by having opportunities for direct
information exchange, as a locally based company.
x

Need for communication between providers and users:
The R&D process for pharmaceuticals requires a long-term commitment and involves a hugeamount of investment. Therefore, it is crucial to maintain communication and mutual understanding
between both parties throughout the R&D process, starting from the contract negotiation. NGS
does not have difficulty in this respect, because the company is locally based.
x

Government support in the resource-providing country:
Venture capital-based start-ups are generally operating on a financially uncertain basis, while theviability of natural product drug discovery ultimately depends upon commercial success. In view ofthis reality, it seems highly desirable for the government in the providing country to assist companies
for commercial success for the sake of mutual benefits. Malaysian government agencies haveplayed a significant role in promoting a good investment climate for NGS.

5. Case Study 2: National Institute of Technology and Evaluation (NITE):
Collaborative Research Experience in Microbial Taxonomy with Other Countries
Background for the establishment of NITE Biological Resource Center (NITE-BRC)
Microbiological resource centers are fundamental to preserving and harnessing microbial
biodiversity and genetic resources. The availability of precisely identified and validated microbial
resources is essential for scientific research and industrial and other applications. In many cases,
microbial resource centers are centers of excellence for preserving microbial biodiversity andtraining microbial taxonomists. In recent decades, academia in Japan has experienced a decline oftaxonomic experts trained to discover, identify, describe and classify microbial biodiversity. For
example, when professors in microbial taxonomy retire, the universities often suppress the posts, andrecruit researchers with disciplines more ‘glamorous’ than taxonomy. This trend has led to drastic
reduction in graduate training in microbial biodiversity research. Becoming increasingly concerned
about the situation, Japan’s academia and industry together made a recommendation to thegovernment that a national microbial resource center be established which is to be adapted to theprinciples of the CBD and the genomic era. In response to this recommendation, the Japanese
government, in 2002, created a microbiological resource center within the National Institute ofTechnology and Evaluation (NITE-BRC).
Organization of NITE-BRC
Within NITE-BRC, the functions of the microbial culture collection and genomic research areintegrated to promote synergy and to add value to the microbial resources and associated data. The

11

functional organization of NITE-BRC is as follows:x

Preservation and distribution of microbial resources as references
NITE-BRC collects, identifies, preserves and distributes potentially useful microorganisms andcloned genes to users to promote basic research as well as industrial and other applications. Thesestrains serve as references for diversified purposes. As a separate entity, NITE also has a patent
microorganism depositary in accordance with the Budapest Treaty.
xMicrobial genome analysis
The function of microbial genome analysisis integrated within NITE-BRC. Once genome

analysis of a microorganism is completed, the results are released for public use in the “Database of
the Genomes Analyzed at NITE” (DOGAN)9.
x

International collaboration in microbial taxonomy
Based on the principles of the CBD, NITE-BRC has been conducting collaborative researchwith a number of Asian countries in microbial taxonomy. NITE-BRC contributed to the creation of
the Asian Consortium for the Conservation and Sustainable Use of Microbial Resources (ACM) forregional collaboration as described below.
Concept of international collaboration and “Tsukuba Statement”
The concept of international collaboration that has been leading NITE-BRC is described in the‘Tsukuba Statement’ issued by the Global Taxonomy Initiative (GTI) Programme of Work in
Microbiology that took place in Tsukuba, Japan in October, 2003(see Box 2).10, 11
Key points from the Tsukuba Statement include:
1) Strategic inventory of microbial diversity should be developed in each country.
2) Taxonomists themselves should recognize the importance of their role for solving biodiversity
problems. National governments should establish laboratories and institutes for applied microbial
taxonomy.
3) Developed countries are requested to draw up and implement a plan for the advancement of
microbiology in collaboration with developing countries.
4) Providers and users of microbial resources must respect and follow the CBD and the Bonn
Guidelines.

National governments should pay attention so that the CBD does not hinderdevelopment of strategic inventorying of microbial diversity.
5) The data from the inventory work in each country should be managed within database systems
which support global networking.

9

DOGAN (http://www.bio.nite.go.jp/dogan/Top)
ANDO K. and M. WATANABE 2004. Global Taxonomy Initiative (GTI) and Taxonomy. WFCC Newsletter No.
38: 5011
http://www.wfcc.info/newsletters/newsletter38.pdf
1012

Box 2

Tsukuba Statement
Tsukuba, Ibaraki, Japan, 9 October 2003
Global Taxonomy Initiative (GTI) and Microbial Taxonomy:
1. For the purpose of accumulating knowledge on and the full understanding of microbial
diversity, predicting its change, and assessing the impact of any change, and for the purpose ofdeveloping the technology and measures for sustainable use and the fair and equitable sharing of
benefit, a strategic inventory of microbial diversity should be implemented in each country.
2. Taxonomists themselves should recognize the importance of their role for solving biodiversity
problems. In order to sustain and advance microbial taxonomy and to prevent the loss of andincrease the number of microbial taxonomists, national governments should establish laboratories
and institutes for applied microbial taxonomy. Microbial taxonomists must exert all their powers
to advance microbiology.
3. Recognizing the importance of microbial taxonomy for the strategic inventory of microbial
diversity, developed countries are requested to draw up a plan for the advancement of
microbiology in collaboration with developing countries and the plan should be implemented.
4. Providers and users of microbial resources must respect and follow the CBD and the Bonn
Guidelines. National governments should pay attention so that the CBD does not hinder strategic
inventory of microbial diversity. Providers must accelerate acquisition of strains and specimens
used for taxonomy. In particular, national governments should not excessively restrict theacademic use of biological resources, especially type strains of bacteria and reference strains offungi and algae. As much as possible of the information associated with these strains should bemade available to the public.
5. In addition to the strains referred to above, the data from the inventory work in each country
should be managed within database systems which support global networking, and which are
effective for supporting the clearing house mechanism of transfer of microbes and guarantees
continuity between generations.
NITE-BRC in collaborative research with other countries: Experiences
NITE-BRC signed memorandums of understanding with governmental organizations in Asian
countries; with Indonesia, Mongolia and Vietnam for collaborative research for the conservation andsustainable use of microbial resources, and with China and Thailand for collaboration between
culture collections. Theframeworkand content of the joint projectsvaried, on a case by case basis.
The following is a typical example of terms of partnership for collaborative research conducted:
㧙 Sharing of research results
㧙 Installation of equipmentfor capacity building㧙 Collaboration in sampling, isolation and taxonomical characterization
㧙 On-site workshopsfor technology transfer
㧙 Hosting of researchers at NITE-BRC facilities for joint research and/or technology transfer
The Asian Consortium for the Conservation and Sustainable Use of Microbial Resources(ACM)
NITE contributed to the establishment of the Asian Consortium for the Conservation andSustainable Use of Microbial Resources (ACM) with 12 Asian countries. The ACM is aimed mainly
at the following activities:13㧙 Human resource development and capacity building to manage culture collections of
microbial resources for ex-situ conservation in each member country
㧙 Establishment of a network of biological resource centers and the database of culturecollections of microbial resources with a common interface
㧙 Development of the material transfer system to facilitate international collaborative
research among the member countries in compliance with the CBD
These activitiesin the region have been useful for the streamlined and effective implementationof access to microbial genetic resources, benefit-sharing and capacity-building on the basis of mutual
understanding and goodwill, consistent with the principles of CBD and the Bonn Guidelines.

Conclusions
These case studies are indicative of certain trends in user and provider perceptions on the ABS
process for genetic resources. It is apparent that users, whether in scientific research or commercial
R&D, are conscious of the principles of the CBD, and have developed their practices, in cooperation
with their partners, that are in line with CBD obligations and equity considerations.
The study highlights that commitments of countries to the principles of the ABS and equity of
CBD, can be translated into industry best practices if guidelines are effectively communicated andimplemented. The case studies also indicate that users enter into benefit sharing arrangements
based on a case by case approach in terms of needs of the collaborators. For example, NGS, acompany, is keen on ethical research and honest practices, and the benefits shared were chiefly
monetary in nature, with transfer of expertise to host country researchers to enable the researchcollaboration. On the other hand, NITE, being a government organization, has been transferring
technology for institutional capacity building in partner countries, and the benefits shared were nonmonetary. JICA-JBA has been promoting human capacity building through training courses for bioindustry development in compliance with CBD and other international rules.
Additionally, the case studies present the current trends in pharmaceutical industry that are notfavorable for the use of natural products in drug discovery research, citing reasons of constantly
emerging competing technologies on one hand, and, on the other, lack of clarity on national
regulatory procedure on ABS in some provider countries. This trend is worrisome to the very basisof ABS debates that presupposes the use of biodiversity for development purposes.
The case studies indicate that ABS partnerships between users and providers through bilateralarrangements could provide instances of ABS best practices. These could feed into multilateralnegotiations to culminate in a meaningful ABS regime. It is noteworthy that while examples ofpartnerships have their merits, they cannot ensure general applicability in implementation acrossdifferent regions. It is therefore important to ensure multilateral consensus- building, that guarantees
all parties agree to adhere to a set of principles.

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Contributors
Dr. Balakrishna Pisupati, United Nations University Institute of Advanced Studies(currently withUNEP)
Dr. Seizo Sumida, Japan Bioindustry Association
Prof. Toru Okuda, Tamagawa University Research Institute
Mr. Satoshi Nimura, Nimura Genetic Solutions
Dr. Katsuhiko Ando, National Institute of Technology and Evaluation
Dr. Manabu Suto, National Institute of Technology and Evaluation
Dr. Yoshiyasu Yabusaki, Japan Bioindustry Association
Ms. Junko Watanabe, Japan Bioindustry Association
Prof. A. H. Zakri, United Nations University Institute of Advanced Studies
Dr.Suneetha M Subramanian, United Nations University Institute of Advanced Studies

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