UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
                           WASHINGTON, D.C.  20460
                              November  10,  1986
                     THE PROCEEDINGS OF THE UNITED STATES
                 ENVIRONMENTAL PROTECTION  AGENCY  WORKSHOP  ON
                     BIOTECHNOLOGY  AND  POLLUTION  CONTROL
                              20,  21 March,  1986
                                Wimbledon Room
                      Linden Hill Hotel and Racquet Club
                             5400 Pooks Hill Road
                          Bethesda, Maryland   20814
                        THE OFFICE OF TOXIC SUBSTANCES
                THE OFFICE OF POLICY, PLANNING,  AND EVALUATION
The views, opinions, and/or findings contained  in  this  document are those of
the Workshop's Panel members and should not  be  construed as an official U.S.
Environmental Protection Agency position,  policy,  or decision.

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   THE PROCEEDINGS OF THE UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY WORKSHOP ON
    BIOTECHNOLOGY AND POLLUTION CONTROL
          Zontract Mo. 63-02-3952

           '/ork Assignment  2-16



             November 10, 1986
               Submitted to:

Office of Policy, Planning, and Evaluation
        Office of Toxic substances
   U.S. Environmental Protection Agency
            401 N Street, S.V.
          Washington,  D.C.   20460
               Submitted by:

          The Dynamac Corporation
           The- Dynamac Building
           11140 Rockville Pike
           Rockville, HD  20852

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          MEMBERS OF THE PANEL
DR. GILBERT OMENN (CHAIRPERSON)
Dean
School of Public Health
University of Washington
Seattle, Washington  98195
MS. JODI BAKST
Environmental Protection Agency
(COCHAIRPESSON -and WORKSHOP COORDINATOR)
DR. DOUGLAS CALDWELL
Department of Applied Micro Food Sciences
University of Saskatchewan
Saskatoon, Saskatchewan, SIX, CVO, Canada
DR. ANAWDA CHAKRABARTY
University of Illinois Medical Canter
Microbiology Department
835 S. Wolcott Avenue
Chicago, Illinois 60637
DR. PETER CHAPMAN
Environmental Protection Agency
Environmental Research Laboratory
Sabine Island
Gulf Breeze, Florida  32561
THOMAS DAROAS, ESQUIRE
President and Chief Executive Officer
Detox Industries
4800 Sugar Grove Boulevard
Suite 210
Stafford, Texas  77477
DR. ALAN GOLDHAMMER
Industrial Biotechnology Association
2115 E. Jefferson Street
RocJcvllle, Maryland  20852
DR. BARRY KATZ
MYCOsearch
P.O. Box 941
Chapel Hill, North Carolina  53706

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      MEMBERS OP THE EXPERT PANEL (continued)
DR. ANNE KOPECKY
Sybron Biochemical, Inc.
P.O. Box 808
Salem, Virginia  24153
DR. JOHN LOPER
Department of Microbiology and Molecular Genetics
University of Cincinnati Medical Center
Cincinnati, Ohio  452667-0524
DR. MARGARET MELLON
Environmental Law Institute
Suite 200
1516 "?" Street, M.V.
Washington, D.C.  20036
DR. ANDREW MIDDL2TON
Koppers Company, Inc.
440 College Park Drive
Monroeville, Pennsylvania  15146
DR. THOMAS PEYTON
AraTech consultants
Suite 517
Life Building
300 Main Street
Lafayette, Indiana  47902
DR. GEORGE PIERCE
Battelle Memorial Institute
505 King Avenue
Columbus, Ohio  43201
DR. GARY SAYLER
Graduate Program in Ecology
691 Old Dabney Hall
University of Tennessee
Knoxville, Tennessee  37996

DR. JOHN SMITH
Koppers Company, inc.
440 College Park Drive
Monroeville, Pennsylvania  15146

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                                    CONTENTS

                                                                         Page
  I.  EXECUTIVE SUMMARY                                                  1-1


 II.  STATEMENT OF PURPOSE FOR THE WORKSHOP                             II-1


III.  PROPOSED TOXIC SUBSTANCES CONTROL ACT (TSCA) REGULATOR*
      POLICY FOR BIOTECHNOLOGY POLLUTION CONTROL PRODUCTS              III-l

      A.  Proposed Policy                                              [II-1

      3.  Categories of Concern                                        III-2

          1.  Microorganisms produced by interger.eric transfer of
              genetic informat ion                                      ::i-2

          2.  Microorganisms containing genetic information
              obtained from pathogenic microorganisms                  iLI-1

          3.  Microorganisms intended for deliberate release in the
              environment                                     •         III-3


IV.    BARRIERS TO AND INCENTIVES FOR FIELD TESTING MICROBIAL
      POLLUTION CONTROL PRODUCTS                                        IV-1

      A.  Field Testing Definitions                                     IV-2

      B.  Conventional Versus Engineered Microorganisms                 IV-3

      C.  Barriers                                                      IV-6

          1.  Test site selection and requirements                      IV-7

          2.  Testing standards - design, performance, and
              evaluation                                               IV-10

          3.  Containment issues                                       IV-12

              a.  Monitoring                                           iv-13

              b.  Mitigation and emergency response                    IV-14

          4.  Assessment of'environmental Impact                       IV-15

          5.  Risk assessment criteria                                 IV-15

          6.  Protection of proprietary rights and from litigation     IV-17

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                            CONTENTS (continued)
                                                                       Page
        7.  Regulation                                               IV-18

            a.  Regulation under TSCA                                IV-19
            b.  Permitting and reporting                             IV-21

        8.  Public perceptions                                       IV-21

    D.  Possible Incentives                                          IV-22

        1.  Comparative evaluation of microbial and conventional
            pollution control methods to assess "best demonstrated
            available technology"                                    IV-23

        2.  Consideration of biotechnology as an alternative  to
            conventional :'burn or bury" methods                      .:'/-.2 3

        3.  Use of existing contaminated sites                       17-24

        4.  Development of Federal field testing programs under
            RCRA/Superfund                                           IV-27
V.  BARRIERS TO AND INCENTIVES FOR THE COMMERCIALIZATION OF
    MICROBIAL PRODUCTS FOR POLLUTION CONTROL                           V-l

    A.  Incentives For Commercialization                               V-l

        1.  Microbiological pollution control products -
            historical and current uses                                V-l

        2.  Technological advantages presented by the development
            of new biotechnology products                              V-2

        3.  Market opportunities and investment as a
            function of existing regulatory statutes                   v-2

            a.  Air pollution control                                  v-3
            b.  Water pollution control                                v-3
            c.  Solid waste management                                 v-3

        4.  Basis for the expansion of the biotechnology
            pollution control industry                                 V-4

    B.  Barriers to Commercialization                                  V-4

        1.  Technical barriers                                         V-4

            a.  Need for basic, generic applied, and applied
                research                                               V-4

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                             CONTENTS  (continued)

                                                                        Page


             b.  Need for risk assessment methods and criteria   .       v-5

         2.  Economic barriers                                          v-6

             a.  Research costs                                         v-6
             b.  Development costs                                      v-6
             c.  Commercialization costs                                v-6

         3.  Regulatory barriers               '   •                      v-7

         4.  Public concerns and perceptions of risks                   v-3

     C.  Possible Solutions                                             v-9

         1.  To address technical barriers                             . "-•)

         2.  To address regulatory barriers                             ':'—'»

             a.  Technical regulatory barriers                          V-9
             b.  Establish data on risk and expedite review process    v-10

         3.  To address economic barriers                              V-ll

             a.  Government funding of generic applied and applied
                 research and the development of risk
                 assessment methods                                    V-12

             b.  Use of Small Business Innovative Research (SBIR)
                 program to promote and support the development
                 and commercialization of biotechnology products       v-12

             c.  use of low-interest-rate government loans to promote
                 and support development and commercialization         V-14

             d.  Use of RCRA/Superfund Program to provide
                 characterized sites for field testing                 v-14 .

     D.  Suggested Regulatory Incentives                               V-15


VT.  PUBLIC PERCEPTIONS OF RISKS AND BENEFITS OF BIOTECHNOLOGY
     POLLUTION CONTROL PRODUCTS                         .               VI-1

     A.  concerns about Risks Associated with the Use/Release
         of Microbial Products                           '              Vl-3

         1.  Barriers to understanding biotechnology                   vi-4

             a.  Lack of information                                   vi-4

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                              CONTENTS (continued)

                                                                         Pace
              b.  Misconceptions                                        vi-5
              c.  Lack of multidisciplinary communication               vi-5

          2.  Perception of past industry priorities: Conflicts
              between profit and safety issues                          VI-5

          3.  Prior overstated reassurances by agencies about
              the extent of risks                                       vi-7

          4.  Unclear sense of possible risks                           vi-3

              a.  Risks to environment and human health                 vr-3
              b.  Defining unreasonable risk                            vr-9
              c.  Ability of government agencies to evaluate risks      • c-5
              d.  Risk analysis - baiancir.g costs and benefits         '. :-LO

      3. • Perception of Benefits of Biotechnology                       /:-!!

          1.  Use for pollution control                                vi-11

          2.  Use for emergency response                               VI-11

      C.  Initiatives Suggested To Address Concerns                    VI-11

          1.  Recognition of public perceptions by agencies
              and industry                                             VI-12

          2.  Education of public, academic, scientific,
              and engineering communities and governmental
              agencies                                                 vi-12

          3.  Maintenance of industry's and USEPA's credibility        vi-13

          4.  Development and use of biotechnology-specific
              tier testing and risk assessment methods                 VI-14

              a.  Database                                             VI-14
              b.  Tier testing                                         VI-14
              c.  Risk assessment                                      Vl-15
VII.  USEPA'S POLLUTION CONTROL-RELATED BIOTECHNOLOGY RESEARCH         VII-1

      A.  Environmental Research Laboratories, Gulf Breeze, Florida    vii-2

          1.  Detection of biodegradlng microorganisms                 vii-3

          2.  Cometabolism of organic compounds                        VII-3

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                              CONTENTS (continued)

                                                                        Page


          3.  Degradation of chlorinated aromatic compounds by
              anaerobic microorganisms                                 vn-3

          4.  Degradation of halo-organic compounds - detection of
              microorganisms and analysis of degradation pathways      vil-3

          5.  Environmental impact - monitoring and assessment
              methods and biological containment                       VII-4

              a.  Environmental ecology                                '7II-4
              b.  Methods for biological self-containment for
                  released microorganisms                              vir-5

      3.  Hazardous Vaste Engineering Research Laboratory,
          Extramural Research, Cincinnati, Ohio

          1.  Chlorinated organic compounds - Jevelcpment of
              .inaerobic blcdegraders

          2.  Microbial binding proteins - isolation and
              characterization                                         VII-6

          3.  Enhancement of microbial nitrification                   vil-7

          4.  Elucidation of the mechanisms of methanogenesis          vil-7

      C.  Hazardous Waste Engineering Research Laboratory,
          Intramural Research, Cincinnati, Ohio                        vil-8

          1.  Construction of blodegradative microorganisms            vil-8

          2.  Microbial degradation of polychlorinated biphenyls       vn-9

          3.  Plant uptake of hazardous wastes                         vii-9

          4.:  Degradation of chlorinated organic compounds by
              white rot fungus                                         vil-9


VIII. SUMMARY                                                         VIII-1


IX.   APPENDICES

      A.  Dr.  Omenn's Report on the Workshop                             A-l

      B.  Workshop Background Paper                                      B-l

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                         CONTENTS  (concluded)


                                                                    Page


C.  Workshop Program
                                                                    C-l

D.  Abbreviated Biographies of Panel Members

E.  List of Workshop Observers
                                                                   S-l

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                             I.   EXECUTIVE SUMMARY
      Consistent  with  its mission  to  protect  the  environment  and  human
health,  the  U.S.  Environmental  Protection  Agency  (USEPA)  is  exploring new
technologies  that  may have potential  applications for  the safe,  effective,
and  economical   removal   of   hazardous   substances  from   the   environment.
Although microorganisms  have  been used  for  years  in  waste treatment,  it is
conceivable  that  biotechnology  products,   consisting  of  both- jenetleally
engineered or  nonengineered  microorganisms  and  cheir  cellular products, .T.ay
have broader  applications  for  direct or  complementary treatment  of hazardous
substances   in   toxic   dumps,   chemical   spills,  and  wastewaters.    "M..- >c:
.nicrobiological   treatment   may   decrease    concentrations   of  hasar-icus
substances   and   thus   eliminate   che   r.eed   for   secondary  trsdcrr.er.-.3.
3iotechnology  products  may also  be  used as  alternatives  and/or complements
to existing pollution control technologies.

      The development of  biotechnology products (both genetically  engineered
and nonengineered  microorganisms and  their  cellular  products) for pollution
control  is  lagging behind  product  development  in  other  sectors  of  the
biotechnology  industry.   To  identify and examine the  factors that influence
the development  of biotechnology  pollution  control products,  the  Office of
Toxic substances and .the Office  of Policy, Planning,  and Evaluation convened
the  Biotechnology  and  Pollution  control  Workshop.   The  goals  of   this
Workshop  . were   to   examine   the   barriers   to   and   incentives   for
commercialization;  to develop  recommendations for promoting, evaluating, and
regulating   field   testing;   and  to  identify   strategies  to  foster  the
development   and  commercialization   of  biotechnology   pollution  control
products.   The  invited  participants   in the  Workshop  included  academic,
industrial, and Agency biotechnology experts.

      Several  technological  advantages  of  the  application of biotechnology
products  to  pollution  control  were identified.  Although  these  advantages
are conceivable for either  engineered or nonengineered microorganisms,  the
Panelists  felt  that  genetic  engineering  would  allow  the  development of
biotechnology  products  that can be specifically tailored.   Included  among
                                      1-1

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the   technological   advantages  of  using  biotechnology  pollution  control
products are the ability to:

      1.  Develop   strains  with   enhanced  activity   in  specific
          degradative enzymes;
      2.  Develop   strains  whose   functional   activities  are  less
          susceptible to environmental conditions;
      3.  Develop   strains  capable   of   withstanding  highly  toxic
          environments;
      4.  Develop potentially  controllable microorganisms;
      5.  Develop  genetically marked  strains  that  are  intended  cor
          deliberate   release   in   the   environment   (this   would
          facilitate  the  monitoring  of  survival  and  dispersal  as
          well as protect proprietary  rights); and
      6.  Develop  strains   that  ire  safer  than  naturally cccurri~q
          and nonengineersd strains.

      In  the  Panelists'  opinion,  microbiological  approaches to  pollution
control may  also become more  cost effective than  conventional  methods once
the biotechnology pollution control industry is more fully developed.

      In  this  Workshop,  a variety  of technical,  economic,  regulatory,  and
public  perception   barriers   to   the  commercialization  of  biotechnology
products  were  identified.   Technical barriers  were  Identified as  issues
associated with  the field  testing of biotechnology products, the  need  for
basic,  generic  applied,   and  applied   research,   and  the  need  for  the
development  of   risk  assessment  criteria   and  methodologies.   Economic
barriers  that were  identified included the significant costs associated with
research,  development,  and commercialization  of biotechnology products  and
the   industry's  costs  for  indemnification  and   liability  insurance.   As
regulatory barriers, the  regulatory  policies  and  reporting  and permitting
requirements  of  Federal,  State  and  local  governments  were  identified.
Finally,  negative  public  response,  which  is  based on  the. public's concern
and perception of  the risks presented by the  applications of biotechnology,
was identified as an existing  barrier.

      Field  testing is an  important  early step  in the commercialization of
biotechnology   pollution   control   products.    Technical,   economic,   and

                                      1-2  .

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regulatory  barriers   to  field  testing  were  identified.   The   technical
barriers  included  the  lack  of  defined  site  selection  criteria,  testing
standards,  environmental assessment  methods,  and. standardized  methods for
containment, monitoring,  and  emergency  response.   The high costs associated
with  research,  field  testing,  indemnification,  and liability insurance were
identified  as  economic  barriers  to field testing.   As regulatory  barriers,
the  policies  at  Federal,  State,  and  local  levels were  identified.   These
barriers  to field  testing are all  associated  to some extent with a  reed for
additional research.  For example,  research  is needed to define and  evaluate
the   risk   that   may   be  associated  with   the  environmental " release  of
genetically engineered  microorganisms.   The  results  of  such research  could
be utilized to define criteria for selecting field  test sites.

      To  reduce  the barriers to  field cestinq,  the  Panelists suggested :^.e
usci   -f  existing  contaminated  sites  for  field  tests.    r.^.ey -»pec ificjl ly
recommended  that  a  federally  designated/sponsored/managed   field   "sscing
program be developed under  the  Resource  Conservation and Recovery Act  (RCRA)
and/or  the  Comprehensive Emergency Response,  Compensation  and Liability Act
(CERCLA)/Superfund.  They felt  that the use of  these already identified and
characterized sites could  expedite field testing and perhaps  reduce  field
testing   costs   (monitoring,    permitting,   reporting,  and   liability)  to
industry.  Although, the multiplicity  of contaminants that  may be present in
existing  landfills was  identified as a  major disadvantage  of using such
sites,  the Panelists  felt  that  making sites available for  field testing and
reducing the associated cost could act as incentives for field testing.

      Technical, economic, and  regulatory barriers to the development of the
biotechnology pollution control  industry were  also  identified.   Technical
barriers  Included  the  need  for  additional   basic,   generic applied,  and
applied  research.   However,  industry  representative pointed out  that the
significant  costs  associated  with conducting  biotechnology research are
almost  prohibitive.  Although the government is committed  to the  funding of
basic  research,  government  expenditures  for  generic applied research are
limited  which may further retard biotechnology  product  development.   The
point  was also  made  that  until  the  efficacy of  microbiological  pollution
control products  is demonstrated,  it   is  unlikely  that industry would invest
large  amounts of  capital  in  applied/developmental  biotechnology  research.
Economic  barriers  that  were identified were  associated with product  research
                                     1-3

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and  development  costs,  including  field  testing  and  indemnification and
insurance   costs.   Federal,   State,   and   local   governments'   regulatory
requirements,  the costs associated with  meeting these requirements, and the
uncertain regulatory climate were also  identified as barriers.

      Several  suggestions  were  made   to eliminate  technical  and  economic
barriers.   It  was  suggested   that  government  funding  of  generic applied
research be  increased  and that Federal  funds be used  to support  comparative
evaluation  studies  of  microbiological  products  and  conventional   waste
treatment  methods.   The  Small  Business  Innovative  Research  Program and
lew-interest  government  loans  were  suggested  -as  a  -neans  of  supporting
research chat  is  directed towards ass9ssing  the "best  'Jemonstrated  available
technology" and  for  demonstrating the  efficacy of a microbiological  apprcacn
to  pollution  control.    These  funding  :7iechjnisms  could  also  ce  'j^-j--:   -3
promote  and support  generic  applied   and  applied research.   The  ?3r.s:i3t5
felt   "hat   the   government    should    partially   offset   che   costs  of
indemnification  and  liability  insurance.   Finally, the  Panelists felt that
research currently underway  in the USEPA's biotechnology research  program is
critical  for  the development of  evaluative  and  assessment  criteria and
methods.

      Suggestions  were  also   made  to  reduce  regulatory  barriers.   The
Panelists felt  that  legislative  and  regulatory incentives could be used to
provide  guidance and   to  suggest  the  consideration  of  microbiological
approaches  as  alternatives to  conventional waste  treatment methods.  In the
Panelists'   opinion the  full  implementation  of the  existing  RCRA/Superfund
statutes  may  produce   greater  interest  in  the  development  of  effective,
economical  techniques  among waste  generators and managers.   It was pointed
out that the  granting of variances from  regulatory policies may  also foster
the development of new  technologies.

      The  public's concerns  and  perceptions of  the  risks  associated with
biotechnology may influence the  development  of biotechnology products.  For
example, public'concerns are  most  likely to be  expressed  by  the  population
near field  testing sites.   Thus,  a negative public response may  also present
a barrier.
                                      1-4

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      It  was strongly  urged that  cooperative efforts  by  industry  and the
Agency  be undertaken to  educate and  inform  the public with  respect to the
scientific basis  and potential  beneficial applications  of biotechnology  to
pollution control.   The Panelists felt that  every  attempt should be made  by
industry  and  the  Agency   to  maintain  and  build   their  credibility  and
demonstrate  their  competence to  the  public.   it was  pointed  out that  field
tests  would  provide the  Agency  with excellent  opportunities  to  educate,
inform, and  involve  the public and to demonstrate  the potential benefits  of
microbiological pollution  control  products.   In  addition  to  educating the
lay public  thro.ugh the school  systems,  public hearings,  and  Involvement  in
the  Toxic   Substance   Control   Act's Premanufacture  Motif ication  .-aview
process,  it  was  suggested  that  information  be  made  available  to  the
academic,     scientific   -and   engineering   communities   at   professional
conferences,  seminars,   ind via publications in professional  journals.

      The experts  who  participated In  the  USEPA's  Workshop on Biotechnology
and Pollution  Control  identified and  discussed  various technical, economic,
and regulatory factors  that  they felt presented barriers  to the development
of  the  biotechnology  pollution    control   industry.    Based   on   their
examination of these issues,  the expert Panelists  suggested specific actions
and  initiatives  that  could  facilitate  field testing  and demonstrate the
efficacy  of   biotechnology   pollution  control  products.    The  Panelists
recommended  strategies  and  initiatives that  could provide  economic support
and  incentives and  thus  foster  the development  of  the  industry.   These
experts also recommended  initiatives  and  strategies for  creating a positive
perception and  for  building the credibility of the  biotechnology  industry
and the Agency with the public.
                                      1-5

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                  II.  STATEMENT OF PURPOSE FOR THE WORKSHOP
      The Nation has a need for safe and effective methods for pollution con-
trol.   There  are  many   priority  pollutants  in  hazardous  waste  sites,
landfills, industrial  effluents,  groundwater,  and other media.  Conventional
methods  of  chemical  pollution  control include  incineration,  chemical  de-
struction,  and physical  stabilization  ("burn  or  bury"  methods).   New or
enhanced  technologies  are needed  as alternatives and/or  complements to the
conventional  "burn  or bury"  methods.   7or  example,  microbiological methods
are  currently being  used  to  treat municipal  and  industrial  wastewaters,
sewage,  and  toxic spills.   The microorganisms  that  are  employed  cor these
purposes have  not been  genetically engineered.  Improvements in the  -:.< LJC ir.a
microbiological waste  treatment  methods  c^n  '.nerefore consist  oc  r jc ir.'.ng
nonengineered  microbial  products  as well  js  the  development  of ^.enecicaliy
engineered microbial products.

     . Consistent  with  its mission  to  protect  the  environment   and  human
health,  the  U.S.  Environmental Protection  Agency (USEPA)  is  exploring new
technologies  that may contribute  to  the  development  of safe,  effective
methods for  the removal of hazardous substances from the environ- raent.  The
Science  Advisory  Board   Executive  Committee,   in   its   report1   to  the
Honorable  Lee Thomas,  Administrator of  the  USEPA,  in  which  the Agency's
capabilities  to address several issues  associated with the field application
of genetically altered organisms were evaluated, stated the following:
         "The  techniques  of  modern  genetics  and  environmental
         microbiology  can   aid  substantially   in  reducing  the
         concentration or totally  destroying chemical  pollutants
         In  surface  and  groundwaters,   Industrial and  municipal
         waste   treatment   systems    and   possibly   in   other
         circumstances.   Microorganisms   have   the  advantage  of
         providing a  low-cost,  simple, and  often highly effective
         means for chemical destruction.'"
1   Science Advisory  Board, Office  of  the Administrator.   Assessing EPA's
    Biotechnology   Research    and    Information    Needs.     Report   No.
    SAB-EC-86-009.  January 1986.
                                     II-l

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      The  use  of  biotechnology  products,  either  microorganisms  or  their
cellular  products,  may  increase the Nation's  capacity and capabilities  for
pollution   control.    Biotechnology   products,   from   either   genetically
engineered   or  nonengineered   organisms,  may   be  used   for  direct  or
complementary  treatment of  toxic dumps,  chemical  spills,  and wastewaters.
Direct  treatment  may decrease the concentrations of the hazardous substances
and may eliminate the need for secondary  treatments.

      Biotechnology  products  have already  -appeared  in  the  pharmaceutical,
chemical,  and  agricultural  .-narkets.    3y  contrast,   improvements   in   the
existing  biotechnology  products  (r.cnengineered   microorganisms)  -and   'he
development  of genetically  engineered  .nicrobial  products  for  the  pollution
control  market has  been slower.   The Agency  recognizes  chat  3  variety  jf
technical,  economic,  .and  regulatory  barriers  co  the  commercial  d^vei ^c.T.5-.:
of biotechnology  products  for pollution control -jxist  and  that  these  L.-..iLDit
the development  of such products.   The usEPA  Workshop  on 3iotechr.olc<:y  snd
Pollution  Control  was  held  to  identify  and   analyze   the  factors   "hat
influence the development of  safe  biotechnology pollution control  products.

      In  accordance  with this purpose,  it was requested  that  the Panelists
discuss   three    factors    associated   with   the   commercialization   of
biotechnology.   These   were  the  identification  and  examination  of   the
technical,  economic,  and  regulatory  barriers to  and  incentives  for  the
commercial  development  of  biotechnology  pollution  control  products,   the
development  of  recommendations   for  promoting,  evaluating,  and  regulating
field  testing,  and  the identification of  strategies  that  would  foster  the
development   and  commercialization   of  biotechnology   pollution  control
products.

      Field  testing  is one  of  the  first  steps  in   the  commercialization
process.   The  Agency   is  anticipating  having   to  evaluate  and  possibly
regulate  the field  testing of  both engineered and nonengineered pollution
control  microorganisms.    Therefore,  the  Agency,  sought  information   and
action-  oriented  recommendations from the  Panelists  on  the  design,  site
selection,  performance,  and  techniques  for  evaluating,  regulating,   and
promoting  field  tests.   Specific suggestions  were  sought  on how industry,
                                     II-2

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academic,  and  Agency  experts  can  cooperatively  develop  data  that  would
facilitate  the evaluation  of  permit  applications  and expedite  the review
process.

      The Panelists were also requested  to identify and explore existing and
potential  incentives  for commercial  development of  biotechnology pollution
control products and to develop strategies that would foster the development.

      The  invited  participants  included  academic,  industrial,   and  Agency
biotechnology  experts,   as   well   as   individuals  representative   of  public
interest  groups.   The  views, opinions,  suggestions,  and  recommendations of
the Panel  members  are reported  in uhls  proceedings of the Biotechnology -and
Pollution Control  Workshop  and  do not  represent an  official  uSEPA pcsitlsn
or policy.
                                     II-3

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     III.  PROPOSED TOXIC SUBSTANCES CONTROL ACT  (TSCA) REGULATORY POLICY
                 FOR BIOTECHNOLOGY POLLUTION CONTROL PRODUCTS
A.    Proposed Policy

      Certain biotechnology products  will  be subject to review and reporting
requirements  under  the Federal  Insecticide, Fungicide,  and Rodenticide Act
(FIFRA) and  the Toxic Substances  Control  Act  (TSCA).   In its 1984 proposed
approach  to  regulating  biotechnology  products,2   the   USSPA   proposed   to
subject  all   genetically  engineered  microorganisms to   an  equal  level   of
regulatory scrutiny.   In  response  to this  proposal,  the  Agency  received and
analyzed comments  from approximately 70 organizations  and individuals.  The
ccmmentors  suggested  that   the  Agency  Identify  categories  of   genetically
engineered microorganisms  that  present higher  and  lower  levels  oc  r:.z.<  -.r.-l
establish'  a   regulatory   policy  in   accordance  with  these  categories.    c.n
consideration of  the  comments   received   in  response  to  the  1984  proposed
regulatory policy  and  experience   gained  during  its  review  of   genetically
engineered microbial  pesticides,  the Agency proposed  a  modified regulatory
policy on microbial products.3

      The modified USEPA  policy  on microbial products  had not been released
at  the  time  that  this Workshop was held.   Therefore, Ms.  Anne Hollander/
Biotechnology Project  Manager   -  OTS/USEPA,  presented  a  keynote  address,
describing  the   essential  elements  of  the forthcoming  policy.  Thus,  a
regulatory context  was established   in which  Workshop discussions  could  be
framed.

      Microbial   products  intended for use in  waste  degradation,  chemical
production,  conversion of  biomass for energy,  and  other environmental and
industrial uses  are subject  to TSCA.  However, the  proposed policy for micro
    USEPA.   Proposal   for   a  Coordinated   Framework  for   Regulation  of
    Biotechnology.  Federal Register 49:50880-50970 (December 31, 1984).
    USEPA.    Coordinated   Framework   for   Regulation   of   Biotechnology;
    Announcement of  Policy  and Notice  for Public  Comment.   Federal Register
    51:23301-23393 (June 26, 1986).
                                     III-l

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bial products will  be different  from that for other chemical substances that
are subject  to  TSCA.  Biotechnology products will  have to be reported at an
earlier stage in  their development.   In addition, the Agency will have to be
notified before any environmental release,  even on a  small  scale,  can take
place.

      Under  the proposed policy,  the  Agency's  resources will  be focused on
those microorganisms  whose  behavior  is most  difficult  to predict, those with
known  inherent  risks,  and  those with  a potential  for  widespread -exposure.
The  Agency  proposes   to   initially   give   special  consideration  to  three
categories of microorganisms.  These categories ara discussed below.

3.    Categories of Concern

      1.  Microorganisms   produced   by   Inrargeneric   transfer  :>f   j.j.ist !•:
          Information

      Microorganisms  produced  by deliberate  human  intervention  that contain
genetic  material   from  dissimilar  source  organisms   (intergeneric  micro-
organisms) are  considered  "new."  Therefore, if  they  are to be  manufactured
for TSCA  purposes,  the "new" microorganisms are  subject  to Premanufacture
Notification  (PMN)  requirements.   This  policy  becomes effective when  the
notice is published.

      In  addition,  environmental  testing  of  "new"   (intergeneric)  micro-
organisms will  not be exempted  from PMN requirements.   Therefore, for "new"
microorganisms  developed for  commercial  purposes,  it will be  required that
the USEPA  be notified prior  to environmental  release.  Ruleraaking  will be
required  to  implement  this  policy.   However,  the  Agency has requested
voluntary compliance with this policy  until  the rule is  promulgated.

      The Agency  will consider  an exemption from PMN  requirements for those
"new" microorganisms  that  will  be used  solely  in contained systems and that
are never intended  for deliberate release in the  environment.
                                     III-2

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      2.  Microorganisms   containing  genetic   information   obtained  from
          pathogenic microorganisms

      USEPA  intends  to complement  its PMN policy with  a prior notification
requirement  for  new  environmental uses  of  genetically  engineered micro-
organisms  that  are pathogens or  contain genetic material  that was  obtained
from  pathogens.   This  will  be  accomplished through  a  Significant  Mew Use
Rule  (SNUR)  to  be issued under Section  5(a)(2)  of TSCA.  The Agency  expects
voluntary compliance until this rule is promulgated.

      3.  Microorganisms intended for deliberate release  in the environment

      The Agency  intends  to  require that seme information (as yet undefined)
be  reported  prior   to  ail  environmental  uses  of  microorganisms  that  ira
subject  to  7SCA but r.ot  subject  to .~MN  or  SNUR  requirements.   This -.-•ill '- =
accomplished through rulemafcing under the authority of Sect'.on  8(a) of rscA.

      In  addition   to   these   three  categories  of  concern,  under   TSCA,
manufacturers,   processors,    and   distributors  of    microorganisms  must
immediately  notify  the Agency  if  they  become aware of new information that
suggests that the microorganisms present a  substantial  risk  to human health
or the environment.

      The  Agency  intends to   require  notification  prior  to all   environ-
mental releases of  microorganisms falling within categories  1  or 2.  Almost
all  other  microorganisms  subject  to either the  FIFRA or the' TSCA  statute
will also have  to be reported  to the Agency prior to the first environmental
release  (category  3).   Information reporting requirements for microorganisms
in  category  3  will  be  somewhat  less  detailed   than that  required  for
categories  1 and  2, but  will  provide the US EPA with  an important mechanism
to monitor  environmental releases  of microorganisms and to  ensure  that the
Agency is aware of any potential problems.
                                     III-3

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          IV.   BARRIERS TO AND INCENTIVES FOR FIELD TESTING MICROBIAL
                          POLLUTION CONTROL PRODUCTS
      Field  testing is  a  necessary and  critical step  towards  developing,
understanding,  and  commercializing  microbial  pollution  control products.
The  field   testing  step   represents  the  first  release  of  a  candidate
commercial  product  from  the  laboratory  to  the  environment.   This  testing
stage  is  designed  to  determine whether  the  potential product  has value  or
efficacy  and  is  also  designed  to  determine  toxicity  and   environmental
effects posed by the release of  the product.

      Testing  in  the  field  represents  ehe first  point where the Agency  nay
be required  to  implement  regulatory  policy,  depending en the techniques -.ji--j
and  the  nature  and  quantity  of  che  .-nicroorganisms.    Currently,   L.-.: a r L.TI
policy  under  FIFRA  requires  notification  prior  to all  small-scale  -field
studies  involving  microbial  pesticides  that  contain   naturally occurring
microorganisms  for  use  in nonindigenous  sites or microorganisms that  have
been  genetically  altered  or  manipulated.4   Regulatory  policy  under  TSCA
will also contain  provisions  and data requirements  that pertain  to field
testing studies.

      Since  field  tests  can  be  conducted  in  different  ways  and  can  be
designed to  answer different questions,  an attempt was made by  the Panelists
to define  field testing  and to  provide  focus  for more detailed examination.
Criteria relevant  to  genetically engineered and nonengineered microorganisms
were compared  and  contrasted,  resulting  in  a  discussion of  the relevant
differences and their significance to field testing issues.

      The  risks and benefits  presented by  the deliberate release  of gene-
tically engineered  microorganisms into  the environment  are highly uncertain
when compared  to more conventional pollution  control  technologies, and it  is
these uncertainties that are major barriers to field  testing.  These barriers
    Nicrobial  Pesticides,   Interim  Policy  on   Small  Scale  Field  Testing.
    Federal Register 49(202) .-40659-40661 (October 14, 1984)
                                     IV-1

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were  discussed  and examined  at  the  Workshop and  include  site  selection
criteria  and   test  standard  development,  containment  issues,   risk   and
environmental   impact   assessment   procedures,   protection  of   proprietary
rights, regulatory  and permitting requirements, and public perceptions.   The
purpose of  the  discussion was  to  promote  the sharing  of  ideas among  the
Panelists to develop ways of reducing or eliminating these barriers.

      Although  both risks and  barriers are preser::,  it  was  recognized  that
there is both  potential and  a market for efficacious, genetically engineered
pollution  control  microorganisms.   It  was  requested   that  che  Panelists
examine possible incentives  to encourage technology development.- The use of
existing  contaminated  sites,  i.e.,   landfills,  surface  impoundments,   and
waste  dumps,   for  field  otudies   was discussed   in  detail.    As  another
incentive,  the comparative  evaluation  of microbial  Jegradaticn  methods  •i-.d
conventional  pollution  control  methods  could  be .performed  to  assess  ::-.-
"test  demonstrated  .available  cachnology"  for  particular  hazardous ••'•a-ic-i
sites.  In  addition,  if government regulations and guidelines  were  :'3v«jio?ed
to  encourage  the  use  of  more  innovative  biotechnology  products  as an
alternative  to  conventional  pollution control  methods,  clear  developmental
and marketing  incentives  could be provided to the biotechnology  industry and
the research community.   Finally, the development of a Federal  field  testing
program under  RCRA  and/or Superfund was perceived  as a procedure that could
facilitate the  field testing of experimental products by  industry.

A.    Field Testing Definitions

      Field  testing is  an  intermediate  phase between  research  and  product
development  and  is conducted after  preliminary  pilot  studies  and before
actual  application  or  treatment  of  the  product.   The  initial  pilot or
feasibility  studies   are  usually  conducted  in  the  laboratory.   These
laboratory  studies  may be on a  bench'scale, or  may  involve microcosm or
larger  greenhouse  studies,   but  they  always take  place  in  a  controlled
setting.  Pilot studies are  designed to investigate  the feasibility of  the
product,  but   cannot   effectively  provide  data  for   technical  direction
(engineering applicability)  or  economic prediction.  For  these  reasons  and
others,  field   testing  is  an  important   stage   of  research  and  product
development.    Field   test  designs  draw   on  the  results   of   laboratory
                                      IV-2

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feasibility  studies  and  incorporate  procedures  to  allow  measurement  and
understanding of the  processes  involved.   Field tests are trials  intended  to
enhance  assessments  of  feasibility,  while  examining  the  safety  of  the
product.   These  studies  are.  designed  to  determine  the   ability  of  the
microorganism  to  biodegrade the contaminant  in a characterized environment,
on  a  limited  scale,  within a  given time.   They explore effects on  target
species and more closely simulate  weather and other variable conditions  that
cannot  be  adequately  investigated   in a  laboratory  setting.    Information
gathered   from   field  studies  allow   for  more  accurate  decision-making
concerning  future  capital  investment  and  risk/benefit   and  cost/benefit
analyses.

      Dr.  Cmenn  compared  the  development  of biotechnology  products  -:o  :>.e
development of medical  products.   He stated "hat :he approach to  research  :5
very  much  more cautious  dnd regulated  than cr.e approach  to :reacmep.: .   in
the medical realm,  informed consent, review committees, institutional  sacety
assessments,  and  elaborate  procedures  are  required  for   research.    Once
research  findings  are  reviewed  and  procedures  are  developed into forms  of
treatment,  "almost   anything  goes with  the  broad  domain   of   ethical
professional  behavior   and patient  acquiesence."    Dr.   Omenn   felt   that
biotechnology field tests are  likely to be considered as  research  endeavors
and will  therefore be  conducted  with  more  caution and under  more control
than the eventual applications.

      Field studies are designed  to generate data  to  guide the  development
of  appropriate  treatment regimens.  Risks  must  be  elucidated and  understood
from field  testing before procedures can be expanded and extrapolated to  the
much larger treatment  scale.

B.    Conventional Versus Engineered Microorganisms

      Microorganisms  and microbial  products  are not new  to commerce.  They
have been used for hundreds of  years by the food and beverage industry, have
been registered for pesticidal  use  for approximately  20 years,  and are used
in  various  systems for  pollution  control.  Municipal  and  industrial waste-
water  treatment  generally  rely on  natural  aerobic microorganisms  for  the
removal  of dissolved  organic  compounds.   Anaerobic  fermentation  processes
are  commonly  used to  digest  solid  wastes  in  sewage  treatment  plants.
                                     IV-3

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      Genetic  engineering offers  opportunities to  enhance the  capabilities
of naturally  occurring microorganisms, providing the potential for  increased
efficiency for  current applications,  as well as the opportunity  for  entirely
new  applications.   A  broad  range  of  techniques are available for modifying
microorganisms  and  the  application of  these techniques  to create  modified
microorganisms  that  will be deliberately  released  to the environment raises
questions as  to possible  risk.

      From  a  field  testing  standpoint, criteria  are being  developed  to be
used   in  selecting  testing  sites.   .Vonengineered   microorganisms  have
undergone testing  for pesticidal  applications.  Differences are  perceived co
exist between genetically engineered  and  nonengineered organisms, and  these
differences need  co  be  examined  with regard to selection  of field  -:is-: i.-.^
sites .and in design  of measures co  prevent migration  from  the  site.

      Genec ical I1'  engineered organisms :iiay possess enhanced survivabilicy or
they  may be  less  well  equipped  to  survive  than  their  naturally occurring
counterparts.    In   addition  to  having   engineered  to   enhance a  desired
function, engineered bacteria may  differ  with regard to proliferation, gene
transfer,  dispersal,  or  migratory  ability,  but  any  difference can  be  an
increased or  decreased  potential,  depending on the situation.   Dr. Sayler
pointed  out that  engineered organisms may also  possess "side benefits" that
were  not present  in the  naturally  occurring  strains,   such as  traits  to
promote  better  soil  conditioning  or  biofertilization   as  ancillaries  to
pesticidal functions.

      Dr.   Oraenn   pointed   out   that  distinguishing   between   genetically
engineered  and conventional  organisms  is  complicated since  a   genetically
engineered  organism  seems  to be  defined  by its  mode of generation rather
than  its inherent  characteristics.   He added that  ice  nucleation  bacteria
provide  an  example  of  this complication.   No   research  or   application
barriers  are   presented  to  discourage  taking  organisms  directly  from the
environment,  where  a certain  percentage of  the  population have  lost the ice
nucleation  property.   Similarly,   no  research  or  application barriers are
presented  to  discourage  the  production   of  uncharacterized mutations  by
                                     IV-4

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treating  ice  nucleation bacteria  with mutagenic  agents to produce deletion
mutants for the  ice nucleation property.  On the other hand, in Or. Qmenn's
opinion,  the  production  of  an  organism  that  has  a deletion  in  a well
characterized  gene   through  genetic  engineering  methods  is  subject   to
research  and  application barriers.  Therefore, Dr.  Omenn  stated "there is  a
sort  of awkwardness  about  the background  for the  focus  on the genetically
engineered organisms."

      The  less  specific  "shot  gun"  approach,   vhere mutagenic  agents  are
applied  to  a  bacterial  population  to produce  uncharacterized, untargeted,
nonspecific  genetic  changes,  is  commonly  used  by  research  and  industrial
communities.   In  contrast,   the   very specific  "surgical  approach,"   where
recombinant deoxyribonucleic  acid  (rcr;A)  techniques  are  used  to  n:ot!L5y  i
characterized gerrome  to  perform  a  desired function, is subject  to  rigul-jcory
scrutiny.  Awkwardness and inconsistency  is created by scrutinizing  Specific
changes while nonspecific  genetic changes become  routine.

      Dr.  Peyton  added   that  many  sectors   .of   the  population,  including
sanitary  engineers,  are  not convinced  that genetic engineering is necessary
to  enhance  microbial  pollution  control  technology.   Some   feel  that   a
microorganism  can  be  isolated from  nature  to perform almost  any  task and
that  more  effort  should  be  expended  on  culturing  and   acclimatizing
techniques that yield these desired organisms.

      In  fact, identifying microorganisms present in specific sites, or even
those specific organisms that  are  working in  major sludge treatment facility
processes, is very difficult  to do.   The  microbial world is highly amorphic,
making  determinations of  the  major  number  of  species and  the  taxa they
actually  represent  difficult.  Dr.   Loper  indicated  that  trivial  genetic
phenomenon  frequently  occurs that   change   one  species  to  another,  as
determined by taxonomic criteria, among different microbial genera.

      To  further complicate  matters,  degradation  processes in nature are not
carried out by a single  type of  organism.  In the waste degradation process,
complete  mineralization  is  achieved  by  the interaction of  many  micro-
organisms performing  different steps along the pathway, and is dependent on
and dictated by chemical and physical  aspects of the situation at hand.

                                     IV-5

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      It was  the  general  opinion of  the  Panel that one  way to effectively
apply  biotechnology  to  the  waste degradation  process is  by  promoting an
integrated  approach.    Physical   and  chemical  technologies  can  be   used
together  with  biological  treatment  to achieve  more  complete degradation.
Dr.  Chapman  suggested that  bioavailability should  be  considered.   Chemical
or physical  pretreatment may serve  to better  solubilize  the chemical to be
degraded, allowing organisms  to attack  the substance more  effectively.

      Dr. Loper added chat  an  integrated  approach  might also  allow one to
rely  on natural  microorganisms  co  complete  preliminary  degradation '.vhile
more  advanced  physical,  chemical, or  biotechnological treatments  could he
applied  to  recalcitrant substances  to affect  complete mineralization.  Or,
Jurgen  Sxner  of International Technologies cited an example where  Ince^r.it3d
treatment was used to claan  up a formaldehyde  spill  along a railroad  -'••.-.<.
in northern   California.   Physical treatment  (excavation) was  not  •:'-:? i 31 i i i
along  the rail  line.   lr\ situ  chemical  treatment  reduced  levels frcm  '30,000
to 1,000 parts  per million.   Biological treatment  further reduced  the  level
to the  1 part per million required by  the state.

      With regard  to the selection  of field testing sites  and criteria and
the differences for engineered  and nonengineered bacteria, we can only begin
to identify different sites  by understanding the  specific problems at hand.
Dr.  Loper  suggested  that  "(by)   looking  at the  microbial  species  and the
heterogenicity  of  microorganisms  in (various)  environments—we can began to
identify different sites in the context of case-by-case problems."

C.    Barriers

      Although   biotechnology  applications   in   the  pharmaceutical  and
agricultural    sectors    are    rapidly   appearing,   commercialization   of
biotechnology for  pollution  control  lags  well  behind.   Many interrelated
factors  give   insight  to  understanding  why  such  a   potentially powerful
technology  is  not  yet  being  vigorously  developed  for   pollution  control
applications.   A variety of  technical, commercial,  and regulatory barriers
can  be  identified, including those that present  problems  to the development
of biotechnology  as  an  industry and  those that  are  specific  barriers to
conducting field tests on developing  products,

                                      IV-6

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      This  section will  examine those  barriers that  are restricting  field
testing.   For example,  appropriate field  test study  designs and protocols
have  not  been developed to the  point where  a standard  exists.   Test site
selection criteria  and the design of  testing  standards,  along with  the cost
of  testing, were  discussed as  barriers.   Also, containment issues, including
the  need  for  procedures required  to  monitor  environmentally released bio-
technology  products and  plans for  mitigation and  emergency  response, were
discussed.  Assessments  must  be  made  by  both industry  and  government con-
cerning  the environmental  impact and  risk posed  by  genetically engineered
products.   The  lack  of  procedures  for  conducting   and evaluating   these
•assessments was identified as a barrier co  field testing.

     • 2eyond  field  testing and  assessment  hurdles, industry  representatives
•discussed  perceived barriers  related  co  proprietary  rights  and liability
issues.   .Regulatory   barriers  were  discussed  with  regard  to  reporting
requirements  (TSCA)  and  permitting  (3C3A)/(CSRCLA).  Public perceptions were
also  examined as  a barrier to   technology  development.   The  highlights  of
these discussions are presented below.

      1.  Test site selection and requirements

      Participants  were  asked to enumerate  the criteria that  industry and
academia  have used in  the past to  select  field testing  sites for non-
engineered  bacterial  products.   They  were  also asked  to speculate on the
criteria  that  will be used  in the  future to  select field testing sites for
both  genetically  engineered  and  nonengineered organisms.   Recommendations
were  solicited   with   regard   to   physical  geographical  characteristics;
technical  parameters,   such   as  complexity  of  contamination;  commercial
considerations,  such as  cost  effectiveness;  and  political/social  factors,
including  interaction   with   the  public  sector.    Many  suggestions  were
contributed,  which  can  be combined   into suggestions   for  guidelines  to
facilitate site selection.

      These  guidelines  can be   subdivided into   physical  characteristics,
ecological   characteristics,    accessibility,   weather    conditions,    and
contamination  features.     Mr.  Dardas  pointed  out  the  physical  charac-
                                     IV-7

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teristics of  soil that  must  be taken  into  account.   These include the  type
of soil, i.e.,  clay,  sandy,  loam,  etc., soil, and whether  a soil  is going  to
lend  itself  to the  mixture  and  dispersement  of  the  microorganisms.  Dr.-
Smith also  pointed out  the importance  of  assessing the presence of rocks  or
objects  like  drums that would  impede  test  conduct.   The geographical, layout
and  topography,  including  slope,  and  relationship  to  aquifers will  be
important  factors.   Dr. Smith  stressed the  importance of  bedrock  charac-
teristics  to  the  prevention  of  groundwater  contamination and  pointed out
that  "(fissures)  or  cracks   in  the bedrock  (may result  in)   leaching to  a
lower aquifer."

      The  prevailing  environment   within   the   proposed  test  site .nust  be
assessed for  suitability.  A  fcey  feature  identified  by  Dr.  Chapman  was -he
Itsvel  of  .aeration  at  the   t^st   site.   Dr.  Chakrabarty  pointed >:-!Jt  :r.a
importance  of understanding  -he availability of  nutrients  at  the  =>i:-2.  cc .
Sayler stressed the  need for  a characterization of the organisms  sxioci.-.g  at
the  site and  their  level of   activity.   He also  expressed  a  need  for  a
controllable  environment to work  in,  stating that  "simplicity  is a  kind  of
keynote; rather than working  in organic sediments  in streams,  we'll   try  to
work in  sandy or  rocky  systems  where  you  don't  have as much partitioning  to
organic matrices."

      The accessibility  presented  by the proposed test site will have  impact
on  site  selection.   Mr. Dardas of Detox  Industries stressed  the need for
adequate  roads  to  allow  transport  of  necessary  equipment   and research
staff.  Utilities, such  as electricity, should be readily available,  as  well
as  resources, including water.  Also  the  site  must  be easily accessible  to
permit  frequent  reinoculation  and monitoring  as  required.    Proximity  to
residential areas  must be evaluated and avoided to prevent public outcry  or
controversy.   Access  must  be  protected or  restricted  by fences  or other
barriers to prevent  entry of  nonauthorized  personnel.  These factors  should
be  evaluated  for  each proposed test  site,  since  they may have  significant
effects on both safety and cost. ...

      Prevailing   weather  conditions   were  considered   important,   since
temperature affects  microbial degradation rate.  Mr.  Dardas gave an  example
of  the  importance of  weather conditions,  stating,  "We're  targeting,   in the
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winter  months,  the  cleanup of  sites in  the southern  parts of  the United
States  because...the weather  is going  to affect  the  microbial activity."
Also,  he stressed  consideration of  the  likelihood  of storms  and  the dis-
persal of storm runoff based on natural slope.

      Many features  presented  by the  contamination at the proposed test site
were recommended  for consideration.   Mr.  Dardas suggested chat  contamination
should  be  minimal with  clear  characterization  of the  specific type(s)  and
geographical  extent  of contamination.  He also pointed out  chat  it  is also
important  to understand  the  distribution of  contaminants  within  the test
site.   for  example,  are  the  contaminants evenly  dispersed  or are  they  at
high concentrations  in random pockets?

      Complex   or   extensive   contamination   reduces   the   potential  for
biodegradation  since  this  could  poison  che organisms  being  uciiit=-J  jf.d
interfere with microbial processes.   Mr.  Dardas  stated  that  "some sicis have
a  great  deal  of  heavy  metals  that  will  Just   inhibit  the  growth  of
microorganisms...."   He  also  pointed   out  that  extensive   contamination
presents  containment  problems   such  as  the   potential   for  runoff  and
percolation.

      The physical  properties  of  the chemical  contaminant,  including water
solubility,    soil   absorption,    and   biodegradability  should   be   well
understood.   Mr.  Dardas  discussed the importance of  water solubility to the
prevention of groundwater contamination.   He  stated,  "If you're dealing with
a  contaminant  that  isn't  even water  soluble to  begin  with, you have less
likelihood  of  dispersing  that  contaminant  into  the  groundwater."   Dr.
Chapman  stressed  the need for considering the potential of  the contaminant
to adsorb to soil particles.   Dr.  Smith,  with the Koppers Co., discussed the
importance of  understanding the  blodegradation  pathway of  the contaminant.
For  example,  "are you  taking  everything  to CO,  and water  or...say  in  the
case  of pentachlorophenol,.. .are  you   degrading -to  one   of  the  other
chlorinated   phenols,   which  is  more   soluble  in   solution?...Are  you
solubilizing  them  so  they  leach  into  groundwater,   chlorinated   phenols
(being)  much  more toxic  than  the material that  stays  (behind)?"   In short,
the  opinion   of   the Panel  was   that  the  contamination should be  clearly
                                     IV-9

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defined  with regard  to type, extent,  homogeneity,  complexity, and  physical
properties.

      Several  more generalized  suggestions were made  regarding site  selec-
tion.  The degree and duration of monitoring performed at  the  site should  be
evaluated  and may  significantly contribute to  appropriate or adequate  site
selection.   The  degree  to  which  the  proposed  test  site  resembles   che
proposed  treatment site  is  very  important to  site assessment.   Simplicity
with  regard   to   physical  characteristics,   environmental  characteristics,
resident  biological  diversity,   and  chemical  contamination  was  repeatedly
mentioned  as  a key factor.   The Panelists felt  that it  is also  important  ;o
keep  in  mind  the  fact that one  set of  field testing data and results may not
be  extrapolated  to  another;  che  approach must  be case  by  case uncLi  J.n
adequate  database  exists  crcrri' -.vhich  £o  predict  :rer.ds.    Final':'/.   -'-.ey
stressed  the  fact  that   chemical  contamination   is  not  the  only  . _.-.cjrn
associated   with   biotechnology;   the   dispersal   of   the   :nicroor-j jnisms
themselves must also  be taken into  account.

      2.  Testing standards - design, performance,  and  evaluation

      Feasibility testing, which has been  the  focus  in  the  past, has centered
on  the  capacity  of the organism  to  achieve the  objective task.   Dr. omenn
stated  that  little  measurement of  specific  properties,  such  as growth,
survival,  proliferation,  transfer, or  dispersal of  the  organism,  has taken
place.   He  indicated  the need for  a  stepwlse  procedure  where  information  on
the  organism and  the genetic manipulations  are collected  from the litera-
ture,  followed by laboratory work,  including both  synthesized and natural
core-sample-type  microcosms  to establish feasibility.  Then one must proceed
to  the  field with a  clear purpose in  mind.   The  purpose  should  define  the
risk  endpolnts that  will  be  examined  .and the  functional  objectives of  the
test.

      The  test design should incorporate  actual controls  to verify that  in.
situ  application  of organisms is valid  and,  furthermore, is responsible  for
the observed, degradation.   Dr.  Sayler stressed  the need for adequate repli-
cation of  both nontreated  control areas  that may  have  different   levels  of
                                     IV-10

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contaminants and  of areas  treated with  different levels  of organisms.  He
considered controls  and replicability  important to our  ability to  forecast
success from one application to another.

      Another  important test  design  factor  is the  microorganism selected.
The test organism  should be well  suited  to both the chemical contaminant to
be degraded  and  the  conditions at  the  test site.   A good match is essential
to test success.   The  need and potential  for adding nutritional supplements
should  also  be assessed in relation  to  test  success and  cost  in  eventual
application  at  treatment   sites.   Organisms may  require  the  addition oc
proper nutrients,  such  -as  carbon,  nitrogen, phosphorous, or carbohydrate, or
even  additional  aeration  via  the  introduction   of  hydrogen   peroxide at
various depths.   In  addition to specific •.Tiicrobial and nutritional  require-
ments,  the  size  of  the   inoculijn  co  be  used  .Tiust  be  investisa:3d  --:r.J
established to allow for adequate  survival  but minimal  prolifarati.cn.

      The  duration of   the  test  must also be considered.   Dr.  Smith stated
that a  test's  duration  should  be  specified based  on organism performance in
feasibility  studies  and the  desired degradation  objective.   He  indicated
that degradation of  an  appreciable amount (90-95%) will  take an average of
4-5 months in  soil,  as compared to 5 days of hydraulic retention time  in an
aerobic tank or  activated  sludge system.   The  area of application must  also
be specified.   A  large enough area  must  be utilized  to  give  an  adequate
prediction for engineering  application and. scale-up,  yet the transmission of
the organism must  be controlled.  Monitoring and  containment procedures, In
addition to  emergency  response mechanisms, must be considered in the design
for testing.

      Finally,   Dr.  Sayler  stressed  the  need  for  documenting and under-
standing biological applications that are  not successful.   Tests that do not
produce desired results must be documented  and  evaluated  to provide insight
for future studies.  Only  through  the establishment of databases documenting
successes and failures can a predictive tool emerge.
                                     iv-ll

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      3.  Containment Issues

      The Panel  was asked  to  discuss the parameters  considered necessary to
provide a contained environment  for field testing both genetically engineered
and  nonengineered  pollution  control  organisms.   The  characteristics  that
might be used  to describe appropriate containment levels may include physical
parameters,  i.e.,  enclosure mechanisms;  technical  factors,  e.g.,  a landfill
with a  plastic  (double)  liner;  financial  features,  e.g., cost  effectiveness;
and  political  considerations,  i.e.,  the social  acceptability  of  the options
to  be  considered.    Panelists  were  asked  to  consider  different   types  of
contained  environments,  including greenhouses,   lined  or  clay-capped   land-
fills,  sewage  treatment  facilities,  and terrestrial  oil  wells, as  potential
field  testing   sites.   The Panelists   were  also asked  co  develop a  : :.s'<
fjradient of possible containment  levels.

      Mr. Dardas of Detox Industries  responded that containment praci'.c-^s  are
currently  in  use,  even  though   only  naturally  occurring  microorganisms  are
being used  that  are  not  perceived to pose risk.  His company  has controlled
the  movement  of microorganisms  by  installing  berms  that  extend  below  the
level of contamination  and are  covered  with  plastic.   Mr. Dardas pointed  out
that  these  practices are,  however,  in  place for  the purpose of controlling
the  migration  of  the  chemical  contaminant,  as  opposed the  concern for  the
dispersal of the microorganisms.

      With  conventional microorganisms,  the  escape or migration of  organisms
from  the  site did  not  present  a concern  to the Panelists.   They felt that
there  are  no  existing criteria  for governing   the  escape  of conventional
organisms.

      Dr.   Smith   described    in   situ   treatment   of  pentachlorophenol-
contarainanted  material   in soil,  stating  that  USEPA  guidelines  recommend a
5-foot  buffer  zone between the zone of  incorporation  (the  area  where soil
microorganisms are  actively degrading  the pentachlorophenol contaminant)  and
the  surrounding  area.   A 5-foot  buffer zone is also recommended  to protect
groundwater.
                                     IV-12

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      The  population  density  of  the  microorganisms   is   a   factor   to   be
considered  when  considering containment,  as  pointed  out   by  Dr.  Caldwell.
Increased  densities   create  problems  in  restricting  distribution.   High
densities  increase  the chance  of contaminating  key sites,  such as drinking
water and recreational waters.

      With regard to the criteria  for containment,  Dr.  Loper  indicated that
the  recent  Shackelton  Conference  addressed  this  subject  in  detail  and
recommended that  those proceedings  be  consulted.   However,  the  need  to  design
containment measures  to  take  the  physical features  of  the   site and extremes
of climate into account was  stressed.

      Others felt  that attaining containment  in  an environmental setting :;23
an unrealistic  expectation.   Migratory birds  -and  insects cannot be  r-r.-: j Lr.id
by plastic berms.   Liners  designed for  landfills  can leak,   and  if  .:r.ey :on' ?.
leak  new they  can  in  the  future.    Dr.  Sayler  expressed   the opinion chat
containment is  an unrealistic  consideration for  organisms  that are designed
to be released, survive and proliferate in the environment.

      Dr. Loper added perspective to the containment  issue as follows.

         "We don't  anticipate physical containment  of any microbe
         that's  in  use  (as a  biological  agent),  in  an   entity
         sense.   We  expect  to demonstrate  that, the homeostasis  of
         the  world,  in  most  cases,   is  not  going to lead   to
         biological  escape   of  some organism because  of Its   own
         biological  containment  with   respect  to  all   the  other
         organisms that are out there."
      a.  Monitoring

      Attendees were asked  to  describe  procedures currently used by industry
and  academia  to  monitor  experiments  and/or  commercial  applications  of
nonengineered  organisms.    Predictions  were - also solicited  with  regard  to
foreseeable  changes  that  may  be  appropriate  for  monitoring  genetically
engineered pollution control organisms in field test settings.
                                     IV-13

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      Dr.  Pierce explained  that  sites already  defined  in litigation,  i.e.,
CERCLA  or RCRA,  usually have  monitoring procedures  in  place  and existing
data  to characterize  the site.  Monitoring  at  different  sampling sites  is
required,  as well  as data from the endpoint site, that allows the  area  to  be
certified  as  decontaminated.  This monitoring is targeted  towards  assessment
of  the  pollutant,  as opposed  to  microorganism  levels.   In  addition  to the
pollutant,   intermediary  and  ultimate   metabolites  must   be  known  and
monitored;   biodegradative   pathways   do   not   always    yield   complete
mineralization.

      Dr.  Chakrabarty  described   "he  -aed  to  monitor  genetic  traits  when
genetically engineered microorganisms  are released.   When  genetic  traits are
incorporated on  a  broad  spectrum plasmid,  :he  trait  can be  transmit cad '-.o  a
large  number  of  resident   bacteria.   As  :hey  acquire  che capabi L :;•/   :o
degrade  che  contaminant,  chey increase  Ln  number.    Therefore,  cha  ;;-f ^c Lc
trait inust be monitored  as opposed to,  or  in  addition  to,  trte jeneticaiiy
engineered microorganism.

      Monitoring  becomes  difficult  and  imprecise   when   the  contamination
levels vary between sampling points, which is often the case at contaminated
sites.   Heterogeneous  concentrations  are  often  present   at  DDT-polluted
sites, where pockets containing 1,  10,000, or 100,000 ppra  can be inches away
from areas of  extremely low concentration.  Dr.  Smith added  that the cost of
analytical  procedures  required  to  assay  monitoring  samples  may  exceed
$100,000 and this was  also cited as a barrier.

      b.  Mitigation and  emergency response

      The  Panel  was  asked  to describe emergency  response methods  presently
used  for  unexpected spills  of  nonengineered  pollution control organisms and
to   describe   foreseeable   changes   required   for   genetically   engineered
organisms.

      Attendees .agreed  that  the concept  of  decontamination  needs to   be
introduced  into the field  testing  picture.   After  the  introduced organism
has done  its job,  and if it is perceived to present a problem by persisting.
                                     IV-14

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a  decontamination  phase should  be initiated  to kill  off  viable organisms.
Fumigation  with  methylene  blue,  irradiation,  and physical  removal methods
were  discussed.    Dr.   Caldwell  defined  decontamination  as  a  decrease of
organisms  in  the  soil  to  a  level  that  is  present  naturally  in  the
                                    i
environment, since people regard soil  as  nontoxic and soil normally contains
microorganisms.

      Achieving  complete  mitigation or  decontamination cannot  be dependent
on one  system.   Microbial-based technology must  be integrated with chemical
and physical procedures.  This  is  especially important in emergency response
situations, where a rapid response time is essential.

      4.  Assessment of environmental  impact

      Dr.  Cmenn  stated  chat  the  progress  in  biotechnology   and   .'^necic
engineering  over  the  last  decade  has  been  a  pleasant   surprise.   The
technical  progress  has been  much  greater  than  most people  expected.   The
potential  hazards,  recognized  very early  in  technology development  by the
scientific community, have been reviewed with relative reassurance.

      Progress  in  the environmental  area  will  require  a  firm database,
comprised  of  data obtained and  generated by accumulating  appropriate field
test  studies  in  contained  environments  and   applications  in   a  stepwise
fashion to ensure public confidence.

      Field  studies  and  monitoring  data   are   important   to environmental
assessments.  .For example,  if one  knows something about the capability of an
organism  to degrade pentachlorophenol to carbon  dioxide,  water,  and  inor-
ganic  chloride,  one  has  a  basis for  designing  monitoring procedures to
follow  the  process  in  the  environment.    These   types  of  data  provide
reassurance about  the  potential  for  accumulation of  partially  chlorinated
phenols at  the  application  site and are  essential  to adequate environmental
assessments.

      5.  Risk assessment  criteria

      Debate  has arisen  over  the  potential  risk  posed  by field  testing
genetically engineered  organisms.   The level  of  concern  and the  fact   that
                                     IV-15

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accurate  risk assessments  of  the potential  damage to  human health and  the
environment are not  available  provide a barrier to field  testing.   Panelists
were  asked to  characterize a  low risk  testing  situation and  to provide a
rationale for this assessment.

      Dr. Mellon, with  the Environmental Law Institute, cited risk  or safety
concerns  as  one  of  the  primary  reasons for  conducting field  tests.    She
explained  that  from  a  regulatory point of  view,  we  must presume  that  the
microorganisms  to be  tested  are  dangerous.    Information on the  degree of
danger  must  be gathered  under contained, controlled  conditions to .minimize
the  risk  posed  to   the   environment  by  s imply  performing  the  tast.    Dr.
Caldwell expressed another point  of  view.  He stated that "degrading 3  toxic
substance  in  the  environment  using  microorganisms  (involves) accsleratir.g j
natural process by  using  existing organisms  tnat  are  already present :.•;  -:he
environment. "    To    further   tnis   iJea,   r.e   sdded   "people   jrs  '. i-sln1":
perspective"   on   the   nature   of    che   problem  "(by)   considering    cha
microorganism  itself as  -a  toxic  substance...;  While  :!nere are xsnobiotic
compounds, I  don't  think  we really  have  xenobiotic microorganisms  (at  this
point in time)

      In   testing  genetically   engineered  microorganisms   for   pollution
control, Or. Peyton  identified the need to define the risks.  The danger  may
come from exposure to genetically engineered  organisms or from the  pollutant
and its metabolic products.

      Characteristics  of  survival,   proliferation,  dispersal on particles,
dispersal  via insect carriers,  migration through  soil,  movement  in water,
and  gene  transfer  from   an  engineered  donor  to  environmentally  occurring
recipients  are  all   perceived  to present   additional  risk.   However,   the
current   use   of   nonengineered   microorganisms   requires  environmental
perturbation,  through mechanical  disruption or  nutrient addition  to  soil,
which also poses unevaluated environmental risk.

      Field testing  and monitoring are  required  to document  benefit as well
as risk.  Often acceptable risk levels cannot be defined  unless  benefits  are
also  considered.   Cost   is  also  a  factor  in  defining acceptable   risk.
Genetic  engineering  of pollution control microorganisms could conceivably

                                     IV-16

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reduce both  the. cost  and  the  risk  created  by hazardous  substances.  Most
conventional  technologies   create  another  hazardous   waste  rather  than

achieving  complete   destruction.    Biotechnological  degradation  has  the

potential  to alleviate  this problem,  alone  or  in  combination  with other

technologies.   In  order  to assess  risks, many  factors  must  be balanced,

including benefits, costs, and risks of current technologies.


      6.   Protection of proprietary rights and from litigation


      Mr.  Dardas  of   Detox  Industries   expressed  his  company's  posture
concerning demonstration  of their  developed  technology.   He  explained chat
pilot or  demonstration projects cannot  be conducted  without  some assurance

that -follow-on  contracting  ifor site  remediation  will  be  awarded.   Lie:'.2

protection is available  to  prevent  clients crcm observing demonstrac icns ^-.d

chen applying  'he process   themselves  to their sites.   This  threat  :o :he
proprietary  nature   and   exclusive  ownership  of  a  company-demonstrated
technology presents a  barrier  both to the conduct of demonstration projects
and to field testing.


      Dr. Peyton elaborated on this point, as follows:


         "...Investing  in  genetic  engineering  is very expensive
         and, if you  do that,  you want to make sure  that you come
         out with  a product that can sell, that you  have a viable
         microorganism.   As Tom (Dardas)  was  explaining...he has
         clients  who  are  willing  to  pay  him  $250,000  to  do
         something on a cubic yard so they have the rights to (use
         the technology  that his  company developed)   and  he won't
         do  that.  With an  enzyme  (the product can't be cultured
         or  grown) so  you have  some   control   over   the  market
         penetration  of  your  product.   When  you're investing  a
         significant   amount  into .equipping  a  genetic engineering
         laboratory,  you want to make sure that the product cannot
         be stolen by a competitor."
      It should  be pointed  out 'that based  on the potential  application of

one of projects  underway in the USEPA's biotechnology  research program (see

Chapter VII of this document), Mr. Dardas stated:
                                     IV-17

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          "...while   our  company  is  not  involved  with   genetic
          engineering,  I  do believe  that  genetic  engineering  can
          improve   things  we   do.    And   so... I   think  we   will
          immediately begin working on genetic engineering in order
          to   give  ourselves   more   protections   of  all  of   our
          proprietary development	as soon as we can afford  to."

      This   comment   was  precipitated  by  the  presentation   of  pollution
control-related  project on  methods  for  the  biological self-containment for
released  microorganisms   chat   is  underway  in  the   USEPA's   biotechnology
research  program.   Under  the  direction  of Dr.  Cuskey,  USEPA's ERL  at Guif
Breeze, a plasmid-borne "suicide cassette" is being developed.  The  "suicide
cassette"  would  ensure   the  self-destruction  of   microorganisms  harboring
*hese plasmids.   Dr.  CusJcey  stated that

          "...Mr.   Dardas   could  start   accepting   chose  .3250,000
          contracts   if   they knew  "hat   the  clients   could   sift
          (through  the)  soil for a   :ng  time  and  not get the Detox
          process."

      Field  testing  is also important to the  liability issue.   Only through
preliminary  studies  can  predictions  be  made on  the likelihood of  success.
If some guarantee of success can be predicted,  companies are more willing to
withstand the possible  cost  of  litigation.

      Liability  is a key  issue.  Indemnification is needed  at   field testing
sites.   Insurance companies are  reluctant  to provide insurance for new,
unproven  technology.  Alternative sources of indemnification  are  needed to
surmount  liability  barriers.   Time  delays are  created at  litigious  sites
because of  indemnification  reticence where new,  innovative  technologies are
concerned.

      7.  Regulation

      Regulatory  barriers are  perceived  to result from  testing, development,
and reporting requirements under TSCA and permitting requirements under RCRA
and CERCLA.
                                     IV-18

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      a.  Regulation under TSCA

      Regulatory  requirements  that may be  Imposed  on the biotechnology com-
munity  are  perceived  as presenting a  barrier  to commercializing products or
applying  techniques  in  the  field.  Genetic engineering  has been confronted
with  regulatory  barriers from  its inception,  from research to  application.
TSCA presents regulatory barriers  in the  testing and  development  stages.

      The  time  required  for  the  review process   may  present a barrier to
innovation.   Dr.  Goldhammer  described  the time   lag  that  is  perceived by
industry.   He  suggested that,  after  a  company expends  development  time to
create  an organism  with significantly  Improved  capabilities,  90  days  are
required   cor   -a  ?remanuf3cture   Notification  (P^)   -jr.der  TSCA.   This
requirement  is   not   i.n I .self  a  burden,  out aven if  "you've  Jcne  /our
homework" additional materials  may still be required.   However,  to obtain  a
RCSA permit,  the  requirement  for  these  "additional materials  may take  1, 2,
3 years"  for full compliance.   This factor may be a significant impediment
to technology development.

      Or.  Caldwell  expressed  concern over  the  perspective  posed  by  the
nature  of  the   problem, specifically  with   regard  to  considering micro-
organisms  as  toxic   substances.    He  stated  that  there  are  xenobiotic
compounds,   but   we   don't  have   xenobiotic  microorganisms  yet.   Using
microorganisms for  degrading  toxic substances  represents an acceleration of
a natural  process that already  takes  place in  the environment.   Genes that
already  exist  in  those environments  are merely  recombined to  alleviate a
particular problem more quickly than would normally occur.

      Dr. Caldwell  also pointed out  that microbial  ecologists have studied
the.  behavior and  capabilities  of microorganisms   in  environmental  settings
for  some  time  and  expressed  concern  that   performing routine ecological
experiments  in  the  environment  would  require reporting  and  be  subject  to
control under TSCA.

      A substantial  market  currently exists that  involves selling bacteria.
Highly  concentrated microbiota  from  activated sludge  plants or  anaerobic
                                     IV-19

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digesters  that detoxify  groundwater are  currently transported considerable
distances  to seed new  facilities.   This practice  is  common in sanitary and
environmental engineering and does not currently require notifying  the USEPA.

      The  dangers  presented  by  this  practice,   since  viruses   and  human
pathogens  may  be  present   in  the  concentrated  cultures,  were   discussed.
Materials  that are  heavily laden  with uncharacterlzed  microorganisms from
human excreta  are known to  be widespread  in municipal treatment mixes.  The
relative lack  of  regulatory control  or scrutiny over this hazardous practice
is  in contrast  to  the regulatory  requirements for  tasting microorganisms
developed   for  biotechnology  applications  that   are   not   known  to . be
hazardous.   Dr.   Omenn  commented  on   ne   "awkwardness  (of)...che  focus  on
genetically  engineered  organisms."   Dr. Cmenn  noted   that  none  of  -.he
workshop's   industry  participants  planned  :o  introduce   improvement  -.i::~.
•jenetic  engineering  techniques  because  of  ;ra  likelihood  of  ov.ervr.-3'. .vLr.g
regulatory procedures  tied  to the technique,  rather  than  the prcduc:  ic any
defined risk.

      As will  be  discussed  in Chapters V,  VI,  and  VII,  the Agency  is making
efforts  to  reduce  industry's concern about  the  PMN review  process  under
TSCA.   To  assess  the  risk  of   biotechnology   products,  specific  risk
assessment  criteria  and  methods  are  needed.  The  data  and  information
required to  develop  these may be  obtained  from projects that are underway in
the  USEPA's  biotechnology  research  program.   In  addition,  the  OTS  is
developing a database  of  organisms, microbial  products,  strain development
techniques,  and  pollution   control  applications from  the  open  literature.
These data may be of assistance  in assessing PMN submissions in, identifying
the  types  of data  the  Agency would want  in submissions  and  the  classes of
products of  concern to the  Agency,  and  in developing tier  testing criteria.
The development of  risk assessment  criteria and methods and the database may
facilitate technical evaluations  of PMN submissions and expedite  the review
process.

      Mr.  Ronald  Evans, OTS/USEPA,  and  an observer at  the Workshop, stated
the  Agency  felt  that   the  review  process  could  be expedited if  the Agency
received information on biotechnology  projects that were planned or underway
in  industry  prior  to   the  PMN  submission.  He  also  stated  that  the Agency

                                     IV-20

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consistently  encourages  potential PMN  submitters  to  begin discussions with
the Agency  early to determine what concerns  the Agency has about a class of
chemicals and what type of data the Agency will  require  for  its assessments.

      b.  Permitting and reporting

      Mr.  Dardas  expressed  concern  over  USELPA's  emphasis on  control  and
reporting.  He stated  that reporting  requirements make  it very difficult cor
the  industry  to  emerge.   Small  companies  are  significantly  impacted since
they  are without  the  financial  resources  to  provide  tasting  and  analysis
required  for  adequate  reporting.   :ie  compared criminal  law,  where  "a  man
that's indicted  is  innocent  until  he'3  proven guilty"  to biotechnology which
"has been proven guilty before it has even started."

      Dr.. Smith  expressed  concern about  regulatory permitting requirements.
He  described   the  current  permitting  hurdles  required  for   protection  of
groundwater, air, etc., at both  Federal  and  local levels, and questioned the
need   for   additional  permitting   requirements  addressing   genetically
engineered  organisms.   Ms.  Franclne  Jacoff,  of  USEPA's,  Office  of Solid
Waste, explained that
         ..."Each permit  process  is  an individual  process.   RCRA
         and  CERCLA  have   been  far  apart,   (but)  they're  not
         anymore.   (They)  have  to do  the  same things,  except it
         depends  on whether  it's an active  site or  an inactive
         site  and  the  whole  thought  that  these  two  things  are
         separate is  not  working  anymore.  Management  in RCRA and
         CERCLA are realizing this but  they  are very,  very slow to
         pull it  together	   There's  never  been a long-term look
         (at) RCRA or CERCLA —because we're  so busy with yester-
         day's...and  today's problems  that  we haven't  looked to
         tomorrow."
      8.  Public perceptions

      The Panel  felt that  the use of  existing landfills  for field testing
may create negative  impressions of  biotechnology since landfills are already
perceived  as  hazardous.   It  would  be  advantageous  to  avoid  guilt-by-
association  inferences.   Nonresident la1  areas  should be  sought  for  field
test sites to avoid publicity and controversy that may be damaging.
                                     IV-21

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      The  selection  of  sites  for field  tests  has  and  may  elicit  local
opposition.   Dr. Mellon  suggested  that  potentially useful  sites are  those
where  the  public has  a vested interest  in  the  success of the project.   For
example,   test   sites  for  ice  nucleation  bacteria  designed   to   protect
strawberry  crops  should  be  selected  from  areas where  strawberry  farming
contributes  to  the  community  economy.   In this way, a  supportive  environment
can  be  created, contributing  positively  to  test  conduct  and perceptions of
genetic engineering as  a  helpful  technology.

      While   understanding  seme  of  the  advantages  chat  may  come   c"rcm
biotechnology  applications,  the  public  is  also concerned  with potential,
undefined  risks.   The  public   is  also  aware  of  the  dangers  presented by
hazardous  waste.   However,  there  has been  relatively  little  political cr
community  action  over   the  technical  choices  presented  by  municipal -r
industrial  waste  management.   Mo  one  wants  -treatment  facilities,   ./xjsts
•Jumping, or  landfills in  their  backyard.   It is, therefore, common  practice
to  haul  toxic  chemicals  somewhere  else,  thus creating  the impression  chat
the problem is solved.

      Dr. Exner,  from International Technologies, pointed out that by  taking
"tremendous"  precautions  to  control  the  risks  that  may  be  presented by
biotechnology, the risk,  in turn,  becomes greater in the public's  perception.

D.    Possible Incentives

      Contributors were asked  to develop  ideas that could provide incentives
for   research   and   commercialization   of  pollution  control  organisms,
especially .those that  would  encourage field testing.   The  use  of  existing
contaminated  sites,  comparative  evaluation  of  microbial  and  conventional
technologies  consideration of  alternative  versus conventional technologies,
and  development  of a  Federal  field   testing  program were  introduced  and
discussed.

      Possibilities of reduced  reporting requirements and  associated  fees,
tax  incentives,  and  supported  insurance  policies were  mentioned,  but an
overriding  theme  was  the  need   for  a focus   on  existing  regulations.
                                     IV-22

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Regulations such  as  the Clean Water Act,  RCRA,  Superfund, and Safe Drinking
Water  Act  were  mentioned  as  vehicles  for  implementing incentives  to  the
biotechnology  community to  allow demonstration  of the  applications  of  new
technologies and methods.
      1.  comparative  evaluation  of  microbial  and  conventional  pollution
          control methods to assess  "best demonstrated available  technology"
      TSCA is  an  unreasonable risk  statute.   To  make this unreasonable  risk
determination,  OTS   must   consider   the   benefits  associated  with  using
genetically engineered  and  nonengineered microbial  products.   Mew chemicals
are  evaluated  by comparing  costs,  physical-chemical  properties,   jnd  ;jse
conditions  to  similar- parameters  known  for  chemicals  used  for  *!*.*  -^rr.a
purpose.   The  benefits" presented  by nicrobial  (genetically  engineer*•'.  -.-
nonengineered)  pollution control technology will .Tiost  likely  be ccmparjJ"  :o
conventional  pollution control  methods;  therefore,  research  is  -aedad  in
this  area.    The  technologies   must  be  compared  with  regard  to  .cost
effectiveness,  and  technical  parameters, i.e., rates of degradation,  unique
abilities,  safety,  and  risks.   once these  parameters  are documented,  the
benefits  of  the  technologies  can  be  compared,  providing  a  basis  for
justifying  or  abandoning   the   further   development  and   use  of  microbial
degradative technologies.

      2.  consideration of  biotechnology as  an  alternative  to conventional
          "burn or bury" methods

      Currently,  the  Agency relies  on  the  "best  demonstrated  available
technology" for the  treatment of  hazardous  wastes.  To date,  the existing
nonengineered  microorganisms  are  not usually  used  in the open environment
and  no genetically  engineered  microorganisms have  been  released  for  the
purpose of  pollution  degradation.   Thus,  the efficacy of biotechnological
procedures  have  not  been  demonstrated.   In  addition,  the development of
genetically  engineered biotechnology pollution  control  products has  been
slow and  this is due  in part to.  the high  start  up cost's  and  the fact,  that
the  Industry  still  finds   it  more  cost-effective   to use  the conventional
"burn and bury" techniques.
                                     IV-23

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      It   was  the   Panel's  opinion   that  the   shortcoming  of   current
technologies  could  be  overcome by  microbiological  treatment.    Integrated
methods,  where wastes  are pretreated  microbiologically before  incineration
or   landfilling,   could   reduce  both  cost   and   toxicity.    utilizing
microorganisms  for  a  sizable percentage of the degradation helps to detoxify
sites  and  often  makes  the  implementation  of  other  technologies,  which
complete  the  mineralization, more  efficient.   Currently  the ash  that  is
generated   by  incinerators,   if  degradation  of  hazardous   substances   is
incomplete,  must  be  transported to  secure  landfills.   Techniques chat   are
not  totally destructive,  or  do not  promote  complete mineralization,   result
in the creation of additional hazardous  waste  problems.

      Dr. Cmenn  noted that there has  been relatively little use of specific
organisms  as opposed to  using naturally occurring  mixtures  of  or-j-inis.T.s.
Inere is  "tremendous dissatisfaction"  with  the state  of the  arr  in  :-?ii'.ncj
with  landfills  .-and  other   contaminated  sices.    The   protocols   :.-. ac   jfe
recommended  for  pollution control measures  under  3CRA, C51RCLA, Clean  *ater,
Drinking Water, and Clean Air Acts  should give attention to  particular sites
where current methods  are less than  satisfactory and  should  introduce  the
possibility  for the  evaluation of microbiological  biodegradative treatment
options.   The Panelists also  agreed  that  Innovative  technologies must  be
evaluated seriously  to try to overcome  the  rather dismal record produced  by
conventional  "burn and bury"  techniques.

      3.  Use of existing  contaminated sites

      Some  experts  have  suggested  that  existing  disposal  sites, such  as
landfills,  might  be designated  for field  testing genetically  engineered  and
nonengineered  pollution control organisms.   The working group was asked  to
discuss  the  advantages  and  disadvantages of this  proposal  from  technical,
financial,  legal, and political  perspectives.

      A discussion  of potential sites  took  place  first.  Spills and  leaking
storage  tanks were considered  less complex  than landfills, since a  single
chemical  is  usually  involved.   Industrial  point sources  may also be  less
complex; some industrial sites  contain noncomplex mixtures, such as lagoons.
                                     IV-24

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wood preservative  sites containing  pentachlorophenol  or creosote, and  ponds
containing  sludge.   Advancing  up a  complexity continuum,  sewage treatment
sidestreams, abandoned  oil  wells and oil  sumps,  and acid lakes were  listed.
Activated   lagoons,  where   water  Is  pumped  In,  aeration  is   installed,
microorganisms are applied,  and degradation is monitored, were considered as
potential field testing sites.

      Landfills were identified  as  the  most complex sites, yet these  are  Che
most prevalent and  are in need  of  advanced degradative technology.   Several
types of  lane' "'.11s were  identified,  including "old"  landfills  chat  contain
mixtures of compounds  that  may  be easier to degrade since microorganisms  are
already  present.    Mutritional  activation   and   environmental   adjustment
(addition of water or air) :Tiay allow degradation to  take place.

      Other types  of  Landfills  discussed  included uncontrolled  1 ar.d ?-i L L 3 or
open dumps.   These were  defined  as being  uncharacterized  with  respect  to
contaminant  content,   not  monitored,  and  are perhaps  not  useful  as  test
sites.    RCRA  landfills  are better  characterized  and  can  be   of   several
types.    Subtitle  D  landfills  are  classified  as  sanitary  landfills,  while
Subtitle C  designates  hazardous  waste  landfills.    Subtitle C~ landfills can
fall under  interim status when  the  landfill is being retrofitted or expanded
to meet regulatory  requirements or may  be  classified  as having final permit
status.   RCRA-perraitted landfills  may  have  groundwater monitors  in place,
may  have single  or double  liners,  and may  also have  leachate  collection
systems.  Some may  be  clay capped.  Since  RCRA-perraitted  landfills have the
greatest degree of containment  and  monitoring equipment in place,  they are
considered as the best candidates for field testing sites.

      Dr. Chu  of  the  General  Motors  Corporation  provided  some  points for
consideration with  regard  to using  landfills as  field testing  sites.  He
stressed the need  for  testing the  total site,  rather  than a corner or  core,
since the leachate  collection system serves the total  site.   Segregation by
slurry wall construction  may be- possible- but  the  cost  would be prohibitive.
Clay caps may present problems  for  field testing  applications, since  the cap
must be removed  before  the organism  can  be applied,  percolated,   or its
activities  assessed.   He added that the  depth and compaction  of  the  fill
must be taken into account.
                                     IV-25

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      Advantages  and  disadvantages of using  RCRA  landfills as field testing
sites  were discussed.   The advantages  included some  theoretical  points as
well  as more  technical  and political  aspects.  Utilizing  landfills would
provide for testing of capabilities in a defined environment, a relevant and
potentially  useful approach.   'Mr.  Dardas  pointing out  that  such testing
could  serve to remove or mitigate  known  chemical  hazards, help to develop a
better  understanding  of  testing  conditions,  and  for the  development  of new
and  better microorganisms   for  pollution  control.'  Appropriate  sites will
already  be  lined,  providing  for  containment.  Monitoring  data  will  be
available  for  historical  evaluation and  site  characterization, as well as to
provide  for  future  sampling.   Both  legal  and commercial  aspects will  be
served,  since  many   landfill  3ites  have   been  targeted   for  cleanup  by
regulatory  .mandate  or   Legal  action.   significant   expenditure  may  '-lave
already  -:aken  place  co  bring  landfills Into  3CSA  compliance, so  :na: :he
•jdcJad cost of microbiological rreatmenc could be relat ively. modest .

      Although landfills  present many  advantages as  test sites, disadvantages
are  also  presented.    As   stated   by  Dr.   Mellon,  landfills  may  not  be
theoretically  relevant for  basic  research  since  they  represent one  of the
ultimate intended  applications.   More precisely, using landfills may require
the substitution of the research  and development objective with an objective
of application before  the preliminary data are gathered.

      in the Panelists'  opinion,  the major disadvantage of landfills  is the
complexity  of   the environment.   There  is  likely  to  be a nonhomogeneous
conglomeration  of chemical  constituents whose  interactive behavior  is not
well known, and  the component chemicals  may  be toxic to  the microorganisms,
making  survival  uncertain.   A  landfill's  environment  is often  extreme and
far from optimal  for  encouraging  the growth of microorganisms.  Not only are
different  parts  of the  landfill  variable  with  regard to  composition,  but
each landfill .can  be  a vastly different  environment.  Testing results may be
so  site specific  that data cannot be  extrapolated to make  predictions of
feasibility or safety at  other  sites.   Costs may also  be elevated  as  a
result of  environmental complexity, since more contaminants will be degraded
than  those targeted  for eradication.   In  addition.  Dr.  Smith  pointed out
that  the   presence of  components  such  as  drums  and plastic  containers in
                                     IV-26

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landfills may  impede physical  actions,  such as  digging or  turning  that  are
necessary to enhance raicrobial  growth.

      Although  containment  measures may have  already been taken  at  landfill
sites,  the  integrity  of  containment  by   liners  is  suspect.   Groundwater
contamination  may have  already taken place,  compromising any assessment  or
evaluation of  the test  treatment potential  for  groundwater contamination.

      The Panelists  recognized  the fact that  landfills  represent  contentious
settings,  and   their  use -as  field testing site could  meet  with  resistance
from  local  communities and/or  Stata  and  federal  agencies.   Publicity  and
public  controversy  may arise addina  to a  negative view of  landfills,  which
nay  be  carried  over to  .nicrobial treatment  and  use  of Motechnoloqy.   C.n
•addition,  .nicrobial  treatment  /nay  worsen  the   si-tuacion,   .?.obi 11-l.-q   ;•.-
.Tie caboli zing  che pollutants  -and  increasing  risk  to  r.uman  health  ir.d  ~'r\e
environment.

      4.  Development of Federal field  testing  programs  under RCRA/Superfund

      Panelists  expressed  the  need for  federally designated  and federally
managed or  sponsored field testing sites.   In  their opinion,  the Panelists
thought  that   the   innovators   of  mlcrobial  degradation   technology  need
assistance  in  matching  microorganisms,  with  existing,  we11-contained  and
monitored,  contaminated sites  where  the results  will be  most credible  and
the regulatory barriers minimal.

      Several.types  of  sites  were  mentioned as candidates for  consideration.
These  included  military sites,   national   laboratories  such  as  oak   Ridge
National Laboratory,  sites  in Florida mentioned  by Dr.  Al Bourquin, General
Motors  Corporate sites in  New  York as described  by Dr.  Joe Chu, and  known
contaminated   sites   such  as  Love  canal  or  Times  Beach.   Dr.  Pierce
recommended  the generation of  a  list,  similar  to  the  U.S.  Food  and Drug
Administration's  GRAS  (generally- recommended as  safe) -list,  of potential
field testing sites.
                                     IV-27

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           V.  BARRIERS TO AND INCENTIVES FOR THE COMMERCIALIZATION
                  OP MICROBIAL PRODUCTS FOR POLLUTION CONTROL   .
      The development  of microbiological products  for pollution control has
been  slow when  compared with  product development  in other  sectors  of the
biotechnology  industry.   In  an  effort  to  understand  this  phenomenon, the
Panelists  were  requested  to  provide  information  on  some  of   the   rate-
determining  steps  for the  introduction  of  genetically engineered pollution
control   organisms.     Vhile    economical     incentives    on'd    regulatory
considerations  are  important  factors,  the  Panelists  were  also  asked   to
discuss che  !
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      2.  Technological  advantages presented by  the  development  of new
          biotechnology  products
      The  directed  development  of  microorganisms  for  the  degradation of
chemical  pollutants could be  beneficial  for pollution control.   AS will be
discussed  in  Chapter  VII  of  this document,  it  is  possible  to develop
microbial  strains  that   are  targeted  for  specific pollutants,  capable of
surviving  in  highly toxic  environments,  and  that  present  novel  pollution
control  capabilities.   Dr.   Pierce  pointed  out  that  these  new  pollution
control  products  could   be  used  to  augment  conventional  methods, provide
safer microbial  products, and  stabilize  che  results achieved with  existing,
nonengineered  microorganisms.   For  example,  products could be developed  chat
have  enhanced degradative  enzyme  levels,  enzymatic activities  or  in which
new degradative  pathways have been  constructed,  or  chat are  less  susceptible
to   environmental   conditions.    In  addition,   oocsntially   con:rolLdble
.•nicroorganisms  could bs  developed  chat will  self  Jestruct  or  wncsa  jrowth
can be  specifically regulated  by directed changes in  the environmenc,  '..3.,
the "suicide  cassette"  regulatory control mechanism.  Microbial  strains  chat
produce   specific   compound-   or   ligand-binding  proteins  may   also  be
developed.  Or.  Kopecky  felt  that  the development  of  such products for use
in   the  management  of  chemical   spills   would   be   useful.   Finally,
microorganisms developed for  pollution control  can  be "marked"  genetically.
Genetically  marked  strains  can  be  used  to  monitor   the  microorganisms'
dispersal  and  migration  and  provide one  method  for   the protection  of
proprietary rights.   The Panelists seemed to be of  the opinion that most of
these  technological  advantages could, and  should, be first  achieved with
nonengineered microorganisms.
                                  /
      3.  Market opportunities and Investment as a function of existing
          regulatory statutes
      Dr.   Thomas   Peyton  presented   an  update   on   market  investment
opportunities  for  the manufacture and application of biotechnology  pollution
control  products.   According  to  Dr.  Peyton,  the  total cost  .of pollution in
the United  states is $70 billion in today's, dollars  while the total market
for biotechnology  products for toxics was estimated to be $2.6 billion.  He
also pointed out that the amount  that the government spends on generic applied
                                      v-2

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and applied research  is  minor,  but  that government spending  "...is  important
for guiding and stimulating the environmental market	"

      Dr. Peyton  summarized  market  opportunities for biotechnology  pollution
control  products  under  existing regulatory statutes.   These opportunities
are described below.

      a.  Air pollution control

      Under the Clean Air  Act,  $30  billion was spent in  1985  for  the control
of  air  pollution.  It  is  conceivable  that  a biotechnology  product such as
i.Tjnobilized enzymes could  be used  to rjeqrade toxic  organic  substances  "nat
jre present in flue or stack fjases.

      b.  'Vater pollution control

      Under the Clean Water  Act and  the  Safe  Drinking Water Act  (SDVA), 325
billion was spent  in  1985  for  the  control of  water pollution.  Most of  this
expenditure  is  for  biological  treatment  facilities,   e.g., public  sewer
systems.  Under SDWA, the  focus is  the protection  of potable drinking water
sources, aquifiers,  and surface  reservoirs.  Expenditures are  also made to
meet  effluent  guidelines.    Funding  from Congress   for  the  biological
treatment of acid lakes is anticipated shortly.

      c.  Solid waste management

      under CERCLA  and  RCRA, $12 billion was spent  in  1985  for solid waste
management.   Biotechnology  products  may be  more  applicable  to  chemical
spills than to "abandoned dumps" that contain unknown materials.

      While the development  of the  biotechnology pollution control industry
may provide  an economical  and effective alternative to  conventional  waste
management methods,  Dr. Pierce pointed  out that  the  cost-effectiveness of
these products cannot  be evaluated in the absence of field  test results.
                                      V-3

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      4.  Basis  for  the expansion  of  the  biotechnology  pollution control
          industry
      According  to Dr.  Peyton,  it  is possible  that  biotechnology products
can capture  a significant portion of  the  existing pollution control market,
perhaps up to $18 of  the $70 billion total.

      In  addition.  Dr.  Peyton  identified  new  potential  applications  for
biotechnology  pollution control  products.   These  included  the  break down of
toxic substances;  the maintenance  and  cleaning of containers, drums, storage
tanks, piping  systems,  and  underground tanks; 'use as biological barriers and
underliners; and use  for environmental diagnostics.

3.    Barriers to Commercialization

      1.  Technical barriers

      a.  Meed for basic, generic applied, and applied research

      The  need  for  additional  research  was  identified  as  one  of  the
technical  barriers   to  the  development  of   biotechnology  products  for
pollution  control.    Basic   research  is  critical   for   maintaining  the
scientific base  on which new  technologies rest.  It  stimulates  advances in
technologies,  and  focuses on  the  discovery and  understanding  of phenomena.
The  goal  of  applied  research is  to  obtain  information necessary  for  the
development  of  products  and  processes  to  fulfill  recognized,  specific
needs.  Applied  generic research bridges  the  gap between  basic  and applied
research.9   It  has  more  specific  goals  and   is  of  longer duration  than
basic research and has  higher economic risks than  applied research.   Basic
and   generic   applied   research  have  historically  been  performed  under
government  sponsorship,  while  research  involved  in commercialization  of
products  (applied  research, e.g.,  developmental and  scale-up  research,  and
field  testing)  has  been  the  traditional  role of  industry.   The  costs
associated with biotechnology research are significant,
    U.S. Congress,  Office of Technology Assessment.   JH Gibbons (Director).
    Commercial Biotechnology:  An International Analysis.  1984.
                                      V-4

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and  this  tends to discourage  the performance of  relevant research.   During
the  discussion,  it was  pointed out  that  the lack  of  such research hinders
the  development  of  methodologies  needed   to  design, monitor,  and evaluate
field tests  and  for  assessing risks  (Chapter  VII).   Although the  government
is  committed to funding  basic research,  government expeditures for generic
applied  research  are  limited and   this  may  retard  biotechnology product
development.6   Moreover,  the  Panelists  felt  that  until  the  efficacy of
biotechnology  pollution  control  products  has  been  demonstrated,   it  is
unlikely that  industry will  invest  significant amounts of capital  in generic
applied or applied research.

      .Research  is  also  needed to  ccnipare the  safety and  effectiveness of
genetically  engineered  and  nonengineered  biotechnology  pollution cor.tcol
products.  This  is  because genetic  engineering  and  its presumed  1 i.rrlc le^s
potential seems  to be  the  basis  for many  of  'he  concerns for  bic'ecr.r.oic-jy
products  that  are  held  by  che  regulatory agencies,   industry,  ir.d   the
public.     By  comparison,   fewer   concerns  have   been   expressed   about
nonengineered  microorganisms.    Mr. Dardas  described   one   of   Industry's
concerns about genetically engineered pollution control products:

         "...one  of   the problems  with dealing with  genetically
         engineered   microorganisms  is   that   it   may  actually
         stigmatize    work   done    with     naturally   occurring
         microorganisms,  especially  if there is  a  problem created
         with genetically engineered microorganisms."

      b.  Need for risk assessment methods and criteria
      As was. pointed  out in Chapter  IV  of this  document, raicrobial products
may  survive,  proliferate, and migrate  in  the environment.   This produces a
need  for  microbiological-specific  risk  assessment  criteria  and methods.
However,  the data required to develop  these criteria  and methods are not
readily  available.   Because  the  needs  for these data  and  methods  are
pressing, the  Panel  recommended that the USEPA continue  to conduct research
relevant  to  the development  of standards  for  field testing  and to develop
risk assessment 'criteria  and methods.   It  was also pointed out  that only the
USEPA may be able to do research on methods for monitoring.
    Ibid.
                                      V-5

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      2.  Economic barriers

      a.  Research costs

      The  costs   associated  with  conducting  biotechnology  research  are
significant.    Because   of   this,   little   generic   applied   or  applied
biotechnology research  is being conducted in academia or in  industry.

      b.  Development costs

      Unless  the  prospective  economic  benefits  are significant,   industry  is
reluctant  to  -allocate  funds for  biotechnology product  development.  At  this
point in  time,  it seems  that  industry, especially larger ccrr^nies, -Jo r.ot
perceive  aither  -a  r.eed  or  a :n.ar:<5t  Sec  Biotechnology  poliucion ccncr^i
products.  Thus,  seemingly  little -Javelopmental  research is  underway.

      c.  Commercialization  costs

      At  present,   a  few  of   the   smaller   biotechnology  companies  are
interested or engaged  in  the commercialization of  biotechnology  pollution
control  products.    However,   it  was  pointed  out  that   the  costs  of
commercialization  are  also significant,  especially the  costs  involved  in
field  testing.   The  cost  for  field  testing  alone  poses  a   significant
economic barrier  to smaller companies.  Moreover,  additional  costs that may
be incurred as  a  result of regulatory testing requirements or as  part of the
permit  application  review  process  further  enhances the economic barrier  to
the development of biotechnology products for  pollution control.

      To cover  commercialization costs, small businesses  frequently have to
raise capital.    Mr.  Dardas described the  difficulty  that  small  companies
have in raising capital:

         "It's  very,  very  difficult   to  raise money in  this area
         because  you're  dealing  with  an  area  that is  new.   Any
         time   something   is  new  it's  very  difficult   to  get
         capital.   It's   very  hard   to  get  new  companies  and
         emerging  companies to try to  develop an industry	"
                                      v-6

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      Thus,   for   businesses  chat   engage  in   the  commercialization  of
biotechnology pollution  control  products,  the  availability of capital poses
a barrier.

      3.  Regulatory barriers

      The  biotechnology  industry's  perception  of  an  uncertain  regulatory
climate and  the prospect of burdensome  regulatory requirements currently is
hindering  improvements  in  existing  nonengineered  microorganisms   and  the
development  of  genetically  engineered  biotechnology  products' for pollution
control.   Federal,  State,  and local regulatory  policies and their reporting
and  permitting' requirements  for  environmental  testing of  products   present
additional regulatory barriers to commercialization.

      The  policies  and  requirements of  che various  regulatory acenc'ies .r.ay
be  duplicative, differing,  or  unformulated.    Dr.  Smith  described   current
permitting  hurdles  required  by  the  Agency  for protection  of groundwater,
air,  etc.,  at  both Federal  and  local  levels  and  questioned the need for
additional   permitting   requirements    addressing   genetically   engineered
organisms.  In  response  to Dr. Smith's query, Ms.  Jacoff,  osw/USEPA, and an
observer  at  the  Workshop,  explained  that  "each  permit  process  is  an
individual process."   She pointed out  that at  the Federal  level, RCRA and
CERCLA have been separated,  historically, but that  this separation  seems to
be   lessening.   One   incident  Involving  Advance  Genetic  Sciences  (ACS)
provides  an  example of  differing permitting  requirements.   Experimental use
permits were  granted  to ACS for field  testing an ice  nucleation mutant by
the  USEPA's - Office of Pesticides Programs and  the state  of California but
not by the Monterey County Board of supervisors.

      It  was also  pointed  out   that  the  length  of  time  involved   in the
regulatory review process may  pose a barrier.   Dr. Goldhammer commented that
even  though  the PMN review  takes 90 days, the  RCRA  permit requirements and
the  possible  need  to  provide  additional' data "may  take'l, 2  or  3  years."
Thus, the regulatory review process can retard technology development.
                                      V-7

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      Finally,  the unevenness of  the Agency's regulation of microbiological
products was  discussed.   The Agency's relative lack of regulatory control or
scrutiny over existing  hazardous  practices was  discussed.   These  practices
include  the  transportation of highly concentrated samples of microorganisms
used  by   activated   sludge  plants  or  anaerobic  digesters  to   seed  new
facilities.    It  was   also  pointed   out   that   high   concentrations  of
uncharacterized  microorganisms from  human  excreta  are  present  in  municipal
treatment  mixes.   By contrast,  regulatory  testing requirements  are being
formulated  for  microorganisms  that  are  developed  for pollution  control
applications  and chat are not  known  to  be hazardous.

      The  apparent unevenness  Ln  regulation  and  the fact  that  .iiost of che
regulations focus  on  the developmental  technique  rather  than -the product or
any Jecir.ed  risk inhibit ihs  expansion  of  the industry.   :t was Dr.  •"--.-in1;
impression chat  none  of  ths Industry participants in the workshop  :• l-in-._>• j •:•;>
use genetic  engineering techniques  to  introduce  improvements because jc :he
likelihood  of  overwhelming  regulatory  procedures  that  are   tied  :o  che
techniques.

      4.  Public concerns and  perception of risks

      As will be  discussed in Chapter VI  of this  document,  the public has
concerns and  vague  perceptions  about  the  risks that  may be  presented by
biotechnology.   The  Panelists felt  that the  public's  concerns  are  centered
around genetic  engineering technology and are based in part on the  public's
lack  of understanding  of  the  scientific  basis  and  applications  of  the
technology.   If these concerns are  not addressed,  the  public's  response to
biotechnology   may   present  a   barrier   to   the   commercialization   of
biotechnology products.  This  effect may be most  apparent in the response of
the local population near field testing sites.

      in addition  to  the public.  Dr. Peyton noted that,  in general,  sanitary
engineers  also  have  an  inadequate  understanding  of  genetic  engineering
technology.   Dr.  Sayler  noted  a  similar  lack of  understanding  in  the
academic,  science, and  engineering  communities   as well  as misconceptions
held by some government  agencies' personnel.
                                      V-8

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C.    Possible Solutions

      1.  To address technical barriers

          As will be discussed in Chapter VII of  this  document,  it was  the
opinion of the Panel that the government should continue  to  sponsor basic
and generic applied research.  Thev also felt that  generic applied research
should be emphasized and that the USEPA should continue  to conduct
biotechnology-related research that is not underway in academia  or industry,
especially in the areas of basic and scale-up research,  environmental
survival/persistence and impact, field tasting, and risk  assessment
methodologies.

      2.  To address regulatory barriers

      a.  Technical regulatory barriers

      Because the need for data and methods for risk assessment  and criteria
is pressing,  the Panel recommended that the USEPA continue to conduct
research relevant to the development of standards for  field  testing and of
risk assessment criteria and methods that is currently underway  in the
Agency's biotechnology research program.   The rationale for  this opinion was
summarized by Dr. Mellon, who stated:
         "No one in industry nor in academia is going to have any
         incentive to do the kind of research that is necessary to
         assess the ecological effects of release of these
         organisms nor are they going to do the kind of work
         that's going to be necessary to develop the battery of
         tests that the applicants are going to have to do to
         provide EPA (with) Information on which it can make a
         decision as to whether or not the technology is safe."

It was further stressed that, at. this point in time, only, the USEPA may be
able to conduct.research on monitoring methods.  This is the case because
the costs associated with field tests pose an economic barrier, especially
for small companies.  Dr. Smith noted that the costs of the analytical
procedures that are required for monitoring may exceed $100,000.
                                     V-9

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      b.  Establish data on risk and expedite  review process

      One way of expediting the commercialization of biotechnology pollution
control products is through cooperative efforts by  the USEPA,  industry, and
academia to identify regulatory concerns early in the development of
potential projects.  Therefore, the Agency requested the Panelists to
determine if incentives could be identified  that would encourage  industry to
notify the USEPA of research and development progress for  genetically
engineered products in advance of PMN submissions.

      Mr. Sonald Evans, OTS/USEPA, and an observer  at the  Workshop, briafly
explained the background for :his topic.  According to Mr.  Evans, the Agency
felt that the review process could be expedited if  the Agency  received
information on biotechnology projects that were planned or underway  '..-:
industry prior to  the PMN  .submission.  This would allcw the Agency ;o 02
nonintrusively involved in project design such that the Agency would rscaive
the data/inrormation needed for its assessments during the PMN review
process.  He also  pointed  out that through such cooperative efforts, a
positive impression of industry and the Agency can  be made with the public.

      Mr. Evans stated that the Agency consistently encourages potential PMN
submitters to begin discussions with the Agency early to determine what
concerns the Agency has about a class of chemicals  and what type of data the
Agency will require for its assessments.

      Under TSCA,  the opportunity exists for exempting or  reducing reporting
requirements for categories of chemical substances  under Section 5(h)(4).
The Agency, therefore, expressed an interest in obtaining  information on
potentially exemptible categories of biotechnology  products.  The Panelists
were asked to suggest categories of biotechnology products that presented
inherently low risk.  The  Agency was particularly interested in information
that would justify why a category of products  would meet the unreasonable
risk standard.  To stimulate the discussion, the following categories of
products were suggested:   attenuated species,  pathogens versus nonpathogens,
mobile versus nonraobile, indigenous versus nonindigenous,  plasmid-borne
products, and microbial enzymes.
                                     v-10

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      The Panelists discussed  the issues that were  raised by this topic and
the perceived  associated risks.  The  Panelists  did not  agree on the nature
of the  distinctions  between pathogenicity,  opportunistic pathogenic!ty, and
nonpathogenicity.  It  was  suggested  that   the  Agency consult  the National
Institutes  of  Health,  for  their  list  of  pathogens.   In  addition,  the
definitions  of  indigenous  and  nonindigenous strains could  not  be  agreed
upon.    Mobility,  more  specifically,  containment,  was also  discussed  but no
conclusion was made.   It  was,  however,  pointed  out  chat  a  conference7 on
containment had been recently  held,  the  proceedings  of which are expected to
be available shortly.

      Dr.  Omenn  summarized   the  discussion  on  3xemptible  categories  of
biotechnology  products  by saying,  "we are  making  (the)  recommendat i~n  ^'nac
the  Agency  Resist  in   trying  to  develop  the  category  (of   -vxei-or :::•: e
biotechnology products)."

      3.  To address  economic barriers

      The  Panelists  were  asked  to discuss  current  and  future sources of
financing  for  the commercialization of  genetically engineered  pollution
control organisms.  It was specifically  requested that the Panelists respond
to and  discuss  the  following questions.   What innovative  financing tech-
niques  exist  to aid  in  the  development  of  genetically  engineered  organisms
for pollution  control?   For example,  what  is  venture capital's role?  How
can   the  Small   Business  Innovative   Research   program   be  used  more
effectively?   Are  collaborative research  ventures within industry a  viable
option?   What  other  avenues  are  available?   OTS  was  hoping  to gain an
understanding of some of the dynamics of the industry's financial segment.
    The  Schakleton  Point workshop:   Prospects  for  Physical  and  Biological
    Containment  of  Genetically  Engineered  Microorganisms.   1-4  October,
    1985,  Schakleton  Point,  N.Y.   Sponsored  by  the  Cornell  University
    Ecotoxicology Program  in conjunction  with several  Federal  agencies and
    private companies.
                                     V-ll

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      a.  Government funding of generic applied and applied research and
          the development of risk assessment methods
      Dr. Goldhararaer suggested  that  the  biggest  potential source of money to
support research  and technology development is the Superfund program.  If it
could be  worked out legislatively,  research and  development  funds could be
generated  to  fund  feasibility studies  by  either  the  private  or  public
sector.   In  these studies  microbial  biotechnology products (both  engineered
and  nonengineered organisms) would  be compared  with conventional pollution
control methods.

      Following  up  on Dr.  Goldhammer's remarks,  Dr,  Middletown suggested
that there is a need...
         "...to   fund   5c^<*  demonstrative  3f:dies  -:o  get  data
         shewing  that  i.nd-id  there  is potential here  that  can be
         realized. . .and. . .maybe   comparacive  studies. . .where   -.he
         nonengineered  organisms are  compared  with the engineered
         organisms   and...with   the   incineration  alternative  in
         terms of cost.   Once  these  comparative studies have been
         conducted  (and  information is generated)  then  ... people
         might start pouring money into biotechnology research..."

      b.  Use of  Small Business  Innovative Research (SBIR) program to promote
          and support the development  and commercialization of
          biotechnology products
      The  SBIR  program  was discussed  as a  possible  source of funding for
biotechnology   developmental   research  and   commercialization   by  small
businesses.  Dr.  Barry Kat2, who had received  SBIR support,  summarized the
program and  its  funding mechanism.  Because  the SBIR  funding cycle is on an
annual basis and  projects are  funded in three phases,  there are time elapses
during  and between  each  phase.  Therefore,  it  would  take three  and. a half
years to get to the  upper scale of funding under  the SBIR program.

      Dr.  Katz  also shared some of  his  insights  and  opinions on  the SBIR
program.  He noted  that:
                                     v-12

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         "...The  SBIR program  is designed  to take  academic  type
         work   that   has  potential   commercial   application  and
         convert it into real application ---- "

         "Another  area  which is  relevant. . .is. . .phase 3 follow-on
         funding.  If you have  a project  that  they  feel  is  good
         enough  to be commercialized,  they  also  feel it important
         to document  that (fact)... and the  way  they feel chat you
         can document this is  to get a contractual commitment  from
         the  private sector  for  at  least   a  matching  amount of
         funds

         "...The  main  problem   (with  follow-on, funding is)... the
         fact  that investors  are not  interested  in  investing in
         projects  (in che dollar  range of)  $50,000 to $500,000;
         5500,000  is  really  tco  little for most investors  to be
         concerned with....  The minimal matching  funds or minimal
         investment   for   rnost   venture  capital   sources   is  $2
         million."
         "Venture  capitalists  will  risk  money  on  a . . ,
         high value-added  product,  patentabla product...  But it's
         very hard  for  them  to  imagine in an  area  like hazardous
         waste, partly  because if you're  dealing with  genetically
         engineered  organisms,  you  have  to  be able  to establish
         without  a  shadow  of a  doubt   that  the benefits  of this
         kind  of  work  far  outweigh   the  use  of  nonengineered
         organisms."

         "Another  problem  with  venture  capital  (for)  follow-on
         (funding)  is  that  venture  capital  Is concerned  about a
         time line.  Venture capital is concerned about seeing  the
         time horizon that's in the 2- to 4-year range..."

         "...On  the constructive side,  EPA  has  to  reassure  the
         private  investors  that  the  private investors will have an
         ownership,  secure ownership position  in anything that's
         developed,  and  that  they're  willing  to fund  this  for a
         period of  time that  will  enable  the  venture capitalists
         to step in on a time horizon that's suitable to them.

      In response to Dr.  Katz remarks  on venture capital  investments.  Dr.
Niddleton pointed out that:


         "...In the area of  hazardous waste,  a  high  premium is put
         upon permitted  facilities.  If you look  at  wall  Street
         and  the  venture . capitalists,   if you  have  a permitted,
         secure hazardous  waste  • landfill,  you  have  a permitted
         hazardous  waste   Incinerator,  then  you  can  probably get
         all the money you want."
                                     V-13

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      In the absence  of access to such facilities, Dr. Middleton stated that

it's hard to get money.  He continued:


         "In looking  at the  area of the genetically engineered microorganism'
         in   pollution  control   (and)...evaluating   it   as   a  potential
         investment,  the key  issue  will be  are there any data available that
         show...that   this  approach  will  offer   a  competitive  economic
         advantage  over  the  use of   conventional  organisms  or  the  other
         alternatives...such as  the  landfilling or incineration...."

      Based on  this discussion,  it  seems that  under the SBIR program, small

companies  can  get   government   funding  without  losing   their  proprietary

rights.   A need  for  venture  capital  sources  that  are   interested  In  and

willing  to  fund  projects at  the  levels   needed   by  small   businesses  was

identified.
      c.  'jse of Icw-interest-rata government  loans to promote and s
          development and commercialization

      As  a  means  of  encouraging  venture  capitalists  to  invest   in  the

development   and   commercialization   of  biotechnology   pollution   control

products, Or. Peyton suggested tru:


         "...many  venture  capitalists  get  money  that  originally
         comes   from   the   Government.    They   get   cut   rate
         loans....And...if  cleaning  up pollution  is  in  the public
         interest, not  only for profit,  (then)  something could be
         written in  the...legislation  so that maybe a point or two
         off  the  percentage rates  could be provided  to venture
         capitalists  for investing  in that  type  of biotechnology
         for pollution control...."


      d.  Use of RCRA/Superfund Program  to provide characterized sites for
          field testing

      As  discussed   previously   (see   chapter  IV),   there  are  technical,

economic, and regulatory  barriers  to field testing.  In the Panel's opinion,

the  use   of  federally  designated/sponsored/managed   sites   would  be  an

incentive  to  conduct  field  tests.   The  use  of  sites  that  are  already
characterized and  contained, and  that are being monitored  could  reduce the
costs  associated  with  field  testing,  would  facilitate  the selection  of

appropriate  site-specific microorganisms, and may  be more likely  to produce
                                     V-14

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credible results.  Towards  this end, Superfund sites  were suggested for use
in field tests.   The use of federally-designated  sites may also address the
concern regarding the maintenance of proprietary rights by developers.

D.    Suggested Regulatory Incentives

      The  Panelists  suggested  that  the  full   implementation of  existing
Superfund   and  RCRA   statutes  could   foster   the   development   of  the
oiotechnology  industry.   Enforcement  of these  statutes would  promote and,
perhaps,  expedite waste "cleanups."    Under  lax  enforcement-,  it   is more
economical  for polluters to pay the fines than clean up the wastes.

      Legislative   i.ncencives  •-era  suggested   that   would   foster  the
development  of  biotechnology  pollution  control,  products.    These   :..-.ci'jde
funding to support comparative  studies to evaluate microbial  (engineered and
nonengineered) and  conventional pollution  control methods  ("burn  or  bury")
to assess  the "best  demonstrated  available  technology";  providing guidance
by  suggesting  the  consideration   of  biotechnology  as   an   alternative   to
conventional  methods;  granting variances to  foster the development  of new
technologies; and establishing Federal field testing programs.

      The  Panelists   also  pointed  out  that   the  opportunities provided  by
field tests  should be  used  by the  Agency  to educate,  involve,  inform, and
demonstrate  to the public the potential  benefits  of biotechnology pollution
control products.
                                     v-15

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        VI.  PUBLIC PERCEPTIONS OF RISKS AND BENEFITS OF BIOTECHNOLOGY
                          POLLUTION CONTROL PRODUCTS
      Public  perceptions  of  genetic  engineering  can  influence  the  rate at
which  biotechnology  pollution  control  products  are  commercialized.B/9   The
general public  has -latent apprehensions  about the actual  and perceived risks
genetic engineering,  and, by association,  applications of  biotechnology  may
present  to human  health  and the  environment.   Genetic  engineering  or   bio-
technology  also elicits public concerns  because,  In  the  public's perception,
the  distinction  between  human  and  industrial  applications  are not always
clearly  distinguished.    Therefore,   the   association   of  an  accident  or  the
perception of an  adverse consequence  with genetic engineering or  biotsc'nr-.oloay
can incite public  fears,  and  the  .ensuing  public response can  nave on  Impact on
the future development of biotechnology.

      Concern for  potential  risks has  long been associated  with  the  directed
genetic alteration of  microorganisms.    Initially,  the  scientists  themselves
raised  issues  regarding  potential  hazards  posed  by  genetic  alterations.   As
far  back   as  the  1940's,  the  potential  for the  creation  of  uncontrollable
chemically induced  mutations  in microorganisms was raised as an  issue.10   In
the  1960's,   the   concern  centered  around  potential  hazards  that  might  be
presented  by  possible  indiscriminant  genetic  transformation  of  microbial
cells.  Limited public  concern  was expressed  with  respect  to  these early
hazard  issues  that  were  associated with  genetic  alterations in  laboratory
settings.
8    U.S. Congress, Office  of Technology Assessment,  JH Gibbons (Director).
     Commercial Biotechnology:  An International Analysis-.  1984.
9    U.S. Congress,  Office of  Technology Assessment.   Genetic Engineering.
     1982.  Research and Education Association, New York, NY.
10   Hotchkiss RD.   Recombinant DNA  Research, vol.  5,  NIH  publication No.
     80-2130, March 1980, p. 484.
                                     VI-1

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      In  the  1970's,  greater  public apprehension  was  expressed  for  the
potential  risks  presented  by  genetic  alterations  accomplished   by   rDNA
technology.11/12   Again,  the  issue  of potential  biohazards was  raised by
the  scientists  themselves.  Open debates and  numerous conferences and  study
groups were  convened to address the  issues  of the risks that might  be  posed
by rDNA  technology  to laboratory workers  and society at large.  These forums
made  information  on  rDNA  technology  accessible,  were covered  by the media,
and  tended to support the public's  subliminal  concerns about potential  risks
presented by rDNA technology.

      While  the  Initial  conjectured  hazards  of  rDNA  technology   at  the
laboratory   level   appear  to   have  been  overstated,  different  types  of
potential hazards  may be  presented  by the  .-ieveicpment  of the .biotechr.olo:;y
industry.   Public  interest  In  the  future  Jevelopment  of  biotechnology  '.^
»:
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and  academla.   To  initiate  the  discussion,   the   following  methods   for
information  dissemination  were suggested:  directed  use of the media, e.g.,
feature  articles,  news releases,  documentaries;  allowing  public  interest
groups,  industry,  and  academia  to  more frequently comment  on Agency policy
via Science  Advisory Board meetings;  Congressional hearings; and development
of a forum of public meeting.

      At  the request  of the  Chairpersons,  Dr. Margaret  Mellon  presented an
overview  of  and  lad   the  discussion   on-  public   perceptions  of   the
biotechnology industry.   Dr.  Mellon  began  the session  by  pointing out  'hat
the  actual   risks   that  are  presented  by  biotechnology  are distinct   from
perceptions of risks...

         "...chat  'hose  perceptions are an independent  factor that
         :TiUst be  considered by  policy makers and  by the  industry
         in  this  field....It's very important that the  two be kept
         separate."
      To  illustrate the  importance of  the public's  perception,  Dr. Mellon
mentioned the fact  that  it  was  local  public opposition  that stopped Advanced
Genetic  Sciences'   (ACS)  experiment1*  in  Monterey  County,  California,   and
that Congressional hearings  were  instigated within  days  after  the public
learned  that ACS  had  conducted  "an unauthorized  release"  of  the micro-
biological  product.   She  advised  policy  makers that  "...it  is certainly
prudent... .not to underestimate the public perception factor."

A.    Concerns  about   Risks Associated  with  the  Use/Release  of  Microbial
      Products

      Dr. Mellon  identified  several  concerns about  biotechnology  that   she
felt  are  held   by  the public.    The  main   public   concern  about  genetic
engineering   and,   thus   biotechnology,   is  that   uncontrollable  and/or
unpredictable organisms may be  created.  Dr. Oraenn elaborated on  this point
using the ice nucleation bacteria as an example.   He stated that little ap-
19   On  14 November  1985,  the  USEPA  under  FIFRA  Section  5 approved  an
     experimental use  permit  to  test  ice  nucleating, bacteria (Pseudomonas
     fluorescens and  syringae, INA-,  deletion mutants on  a  test  plot  (0.2
     acre) of  2,400 strawberry plants near Castrovllle  in  Monterey County,
     California.

                                     VI-3

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parent  concern seemed  to be  associated with  either the  isolation of  ice
nucleation mutants  from the  environment or by the development of  ice nucle-
ation  mutants using  conventional  genetic methods,  i.e.,  chemical  mutation
induction.  He also noted that by contrast,  the removal of a well-character-
ized ice nucleation gene from microorganisms using rDNA techniques  did  raise
concerns.   In Dr.  MelIon's  opinion  this somewhat  vague concern is deeply
rooted  and  appears  to be based  in part  on a lack  of  understanding of  the
scientific basis and  applications of biotechnology.

      The public's  distrust  of industry was  identified  as another concern.
This  distrust  seems  to  be  based en  the  public's  recollection  of   past
incidents  involving  conflicts  between  the  industrial  profit  motive  and
public  safety issues.  A final concern  "hat  was  identified by  Dr.  Mellon  Is
the uncertainty  about what  possible  risks .Tiay be  presented  by  aopl I-VJE icr.3
of  biotechnology.    In  the  public's  perception,  irhese  potential  r:^'.<3  :-.jv»
yet to  be- identified  or  evaluated.

      The highlights  of the  discussions on  public concerns  are  presented
below.

      1.  Barriers  to understanding biotechnology

      Several  factors   that  appear  to  act  as   barriers to   understanding
biotechnology  for  the general  public  and for  the  academic,  scientific,  and
engineering communities were identified and  discussed by the Panelists.   The
highlights of the  discussion of each  "barrier" are summarized  and  presented
below.

      a.  Lack of information

      The public's  concern  about genetic  engineering probably stems from  an
inadequate understanding of this technology's  scientific basis.  The public
is not  generally aware of the facts that the transfer of genetic  information
between  microorganisms  occurs  in  nature  and  that  genetically altered
microorganisms, albeit  constructed  by  conventional  genetic, techniques,  have
been  used for years to  provide  goods and  services  on which  the public
depends  and   which   serve the  public  benefit.   For  example,   nonengineered
                                     Vl-4

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genetic  alteration  techniques have  been employed  to develop microorganisms
used  in  the production of foodstuffs,  beverages,  and Pharmaceuticals,  con-
ventional  methods  for  genetic  alteration  have also  been used  to develop/
improve  strains of plants  and animals in agriculture.  Moreover, genetically
selected/altered microorganisms  have  been  used  and  are  currently used for
municipal  and  wastewater  treatments,   septic  tanks,  land  waste   treatment
systems,   and  as microbial pesticides.   Currently, microorganisms  are being
employed in the cleanup of chemical spills.

      b.   Misconceptions

      In  addition   to  the  'jeneral  public,  some  individuals  with various
governmental  agencies  have misconceptions  about  genetic  engineering ar.d,   ;y
association,  about biotechnology.   Sr.  Sayler  reported that during  a jemlr.-ir
he  recently  attended,  an  individual  who identified  himself  as  a   .uicrc'o'.al
ecologist with  one of the  Federal agencies cited  an  outlandish example thac
associated  "very  unacceptable  risks"   with   the   environmental  release  of
genetically engineered  organisms.   In  this  instance,  a representative of the
Federal  government  was  "misinforming"   the academic  community.  As another
relevant  example of misconceptions about genetic engineering, Dr. Goldhamraer
alluded  to the questions  and concerns  expressed  by  some of  the  members  of
the Monterey  County Board  of Supervisors and  local residents and statements
made by some of the Supervisors during hearings on  the ACS field test.16

      c.   Lack of multidisciplinarv communication

      During  the  discussion   of  public  perceptions, Dr.  Gary Sayler pointed
out that in the academic, science, and engineering  communities...
16   Public Hearing  before the  Monterey County  Board  of Supervisors  on 27
     January  1986.   The  Board  of  Supervisors,  P.O.   Box   1728,  Salinas,
     California  93902.   This was  an  information-gathering  and fact-finding
     hearing   to  determine   whether  .to  allow   a   microbial   pesticide
     experimental field  test  to  proceed.   In this case,  the microorganism to
     be  employed  was   ice   nucleating,   deletion  mutants  of  Pseudomonas
     fluorescens and  syringae.   It  should be pointed out these mutants were
     developed without using rDNA techniques.
                                     Vl-5

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         "in terms  of their real, fundamental understanding of  the
         approaches   and   the  molecular  basis  for  the  genetic
         engineering    technique   the    actual    knowledge    and
         understanding  in  the  science  and academic  community is
         very scattered."
      In  addition,  Dr.  Peyton  pointed out  that some  sanitary  engineers do
not perceive a  need  for the use of genetic engineering  techniques  to enhance

microbiological  pollution  control  capabilities.  They  apparently  feel  that

microorganisms  that  are capable  of performing  these  tasfcs  already exist in

nature.   3ased  on  this opinion,  the sanitary engineers believe  that the  main
thrust  in the  development of  the biotechnology  pollution  control industry

should  be directed  towards the  isolation  and  development  of culturinq  ir.d

.acclimatizing techniques to harness these existing na'tural  processes.   T.'-.-JS,

"there's  a  real  perception  problem  (regarding   jsnatic   -engineer-l.-.^   i.-vJ

thereby with  the biotechnology industry) in  the science and  engineering  and

academic" communities  and  in governmental agencies.


      2.  Perception  of past  industry priorities:  Conflicts between  profit
          and safety  issues

      The public's perception  of  the biotechnology industry  is  influenced by
the recollection of  prior instances  in  which other  industries appeared to

place a higher  priority on profits than on health and safety.   To  illustrate
this point, Dr. Mellon mentioned  two notable examples where


          "...when  the profit motive conflicted with the health  and
          safety  obligations,   the  companies  didn't  come forward.
          (For example) — the tobacco industry (still insists) that
          the evidence proving that  cigarettes are harmful  to your
          health  is not all that strong, and the asbestos  industry,
          which  has certifiably  ... withheld  ...  information that
          the exposures  to the product  that  they were  making  are
          (detrimental  to human health).  These  (incidents)  are  not
          directly  relevant  to   this  new   industry...but...this
          distrust  of  industry  statements,   ...  is  something that
          (the biotechnology industry  Is-)-not going  to  be able to
          get around at  least right  away."

      Dr. Mellon went on  to point out that the ACS incidents are the first
instances in which the  biotechnology  industry  "revealed  itself to be some-
                                     Vl-6

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what disingenuous about a health  issue or an environmental issue."  However,
in  her  opinion,  the  public  perception  of  the  credibility  for  this  new
industry  is  "very high," and it  is  important that  existing credibility of
the  industry,   the  Agency,   and  public  interest  groups  be  maintained  and

nurtured.


      3.  Prior overstated reassurances by agencies about  the  extent of risks


      The  issues of   the  public's  distrust  of-  regulatory  agencies'   risk
assessment  capabilities  and  of  the  agencies'  and  industry -proponents'
reassurances  regarding  the   safety  of  biotechnology  were  discussed.   Or.
Robert Nicholas, an observer at the Workshop, pointed cut  that...


         "One  of the  problems  33  far  -33  public  perceptions  is
         concerned is  what  I  call the  noncredible risk expressions
         of proponents of the technology...."

         "We occasionally  hear proponents  saying well  there's  no
         credible  risk.   We   all  know that  nothing  can happen.
         We've  seen  this for a  hundred  years  or what  have you,
         we're not worried about it."

         "It may very well  be that  that's absolutely  true.  But
         the public  is seeing Three  Mile  Island and  it's seeing
         the Space  Shuttle and  it's  saying these people told  us
         that  this  couldn't  possibly  happen  and  it  did happen.
         How can we trust you now?"


      Dr. Oraenn pointed out that  with  it's small biotechnology database,  the
Agency had no  basis  on which to  reassure the  public without overstating the

facts.


      Following up on  the point made  by  Dr. Nicholas,  Dr. Mellon elaborated
on the Space Shuttle incident involving the Challenger explosion:


         "I  think NASA  is  a  very  good  example.   I  think...the
         problem  that  they're having  right, now  (is)  because they
         were  revealed upon  investigation to  have lied.  ' Now, the
         immediate public reaction to  that disaster among everyone
         I  know was  that  it  was just  a tragedy,  that   everybody
         knows  that   NASA  has  been  working  as  hard  as humanly
         possible  to  prevent these  accidents.   That  Agency had
         more  credibility  than  any one in  Washington.    And had
         their credibility stood up, they would have withstood this
                                     VI-7

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         accident  beautifully,  without  pretending that this  (was)
         anything other than a  terrible  human disaster."
         "What  we  need   to  do   in   this  enterprise  is   to set
         ourselves  up to  be  like  NASA was a short  4 weeks ago so
         that  ...  when the equivalent of  a disaster occurs,  there
         is  a  credible  Agency  (which)  on  examination   will  be
         proved  not to have  lied,  not  to  have  dissembled, not to
         have  cut  corners, and will  be  able to (acknowledge  that)
         this  happened,  it means  this,  but for the  future of the
         technology (the  Agency is) going to take it into  account,
         not shoving  it under  the  rug, and going  to  go forward.   I
         think  that the public  is very  able to  handle the notion
         of  'we don't know.'"
      4.  Unclear sense of possible  risks

      Dr.   Peyton-  Identified  :he  need   to   define  the  potential   r'\ .-;xs
associated  with  ^eneticaliy   engineered   .-nicroorganisms.   While   .id cur a ILy
occurring,    conventionally    developed,     and    genetically     ^ncir.eared
microorganisms are  all  candidates  for  use,  the public's concern is  the  risks
that  may be  presented by  the use  of genetically  engineered biotechnology
pollution  control  products.   Dr.  Peyton   also  pointed out  that  the  risks
associated  with  exposure to hazardous substances,  to genetically  engineered
microorganisms,  and/or to the degradative products  of hazardous  substances
should  be  identified  and  information used  in  the development of  risk
assessment  criteria.

      a.  Risks to  environment  and human health

      In  Dr.. MelIon's  opinion, the  public's concern  is  for  the  undefined
potential  for  risks  that  may  be  presented  by  biotechnology products  in
general  and  by  genetically  engineered microorganisms  in  particular.   Dr.
Mellon described  the public's  apprehension as follows:  " — The root concern
is   with   the   technology  which   is  widely   preceived  to   have   great
potential...."  And in the public's perception,  this technology provides an
unlimited  potential  for..."manipulating-  the form   and .the  shape  and the
properties  of organisms	"
                                     vi-8

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      During the Monterey County  Board of Supervisors' public hearing on  the
ACS  experiment,  it  was  revealed  that  regulatory  agencies  do not  have
standardized  methods and  criteria  with which  to  assess  identified risks.
This  fact  tends  to  reinforce  Dr.  MelIon's  assessment   of  the   public's
perception that perhaps even serendipitously...

         "...we  really  will  somehow  create  something  (primarily
         microorganisms, although  genetic engineering of humans  is
         an   associated  concern)   whose  properties   we  cannot
         predict,  that   we  will  not  be  able,  to  control  and   is
         somehow going  to hurt us...."
      Since the concern  about  risks  i3 not based on factual  information, Dr.
Mellon  postulated  that  the  public's  apprehension could  be  addrass^J  .i.-.d
"...challenged with  case-by-case  information about what biotechnolocy  cii'Ay
means and how it relates to this general concern."

      b.  Defining unreasonable risk

      Under TSCA's PMN  review process,  unreasonable  risk  is  the standard
used  to  decide  whether  or   not  regulatory  action  will  be  taken   for  a
particular  chemical.   In   its review process,  the  Agency  identifies and
analytically  evaluates  the  risks and takes  both benefits  and  risks into
account  in  judging  whether the  risk may  be  unreasonable.  Given the fact
that  the  possible risks associated  with  the  use of  genetically  engineered
microorganisms have  yet  to be determined, the public  may be at  a loss for
understanding how  unreasonable risks  are  determined.   It  should  be pointed
out  that  there  is  an incongruence  between  the  scientific  assessment and
public's  intuitive  perception of  risk.   This  can  lead  to  contradictory
evaluations of  unreasonable risk by  the  Agency and the  public.   Dr.  Mellon
felt  that  the  differences   in  these  evaluations  should  be  recognized,
addressed, and resolved.

      c.  Ability of government agencies to evaluate risks

      Concern about the  ability of the USEPA to evaluate the risks presented
by biotechnology  products  may have, been  raised in the public's  mind  by the
ACS  incident.   The injunction by the  Monterey  County Board  of Supervisors
                                     VI-9

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and  suits  filed by  public  interest  groups  expressed  concerns  about  the
identification and  evaluation of risks to  human  health that might have been
presented by  the ACS field test  and  about  the methods and criteria by which
the Agency evaluated the ACS  application.

      Dr. Alan  Goldhammer  pointed  out chat  site inspections  by  the Agency
are not required for the issuance of  experimental use permits...
         "...SPA  did give  them  an experimental  use permit.  They
         (SPA)  did  not go  out  and look at  the  site and find (as)
         it was revealed  that  the site was (near residences).  3ut
         you  look  at the regulations  -and  every  time SPA issues  an
         experimental use permit  they  don't look  at  sites...."

      .-.1.  .?isk  analysis - balancing costs  and benefits
      To assess  risk,  TSCA requires  that  the  Agency take both the risks and
benefits -of  genetically  engineered  pollution  control  microorganisms  into
account.  Due  to the  lack of standardized  assessment  criteria and methods,
the  Panelists  felt  that  risk   should  be  determined  and  evaluated  on  a
case-by-case basis.   The Panelists also felt  that  the cost effectiveness of
genetically  engineered  microorganisms  should  be  compared  with  naturally
occurring  and  nonengineered  microorganisms  as  well  as  with conventional
pollution control methods.

      The public is uncertain about  how the  Agency's  assessments  of risks,
benefits,   and   cost  effectiveness  are   utilized  in  the   decisionmaking
process.  To inform  the public  on  the  issues,  to address public concerns,
and  to  educate and  increase   the  public's  understanding  of  the  risk
assessment  process  for  biotechnology products,  the Agency  has  proposed to
make  some   information about  submissions  accessible  to the  public,  invite
comments   from   interested  members  of   the   public,   and   to   include
representatives  of  the  lay  public  on  the Biotechnology  science Advisory
Board.*7
17   USEPA.    "Coordinated  Framework   for  Regulation   of  Biotechnology:
     Announcement of  Policy and Notice1 for Public comment.  Federal Register
     51:23301-23392 (June  26,  1986}
                                     VI-10

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B.    Perception of Benefits of Biotechnology

      1.  Use for pollution control

      As was brought out  during  the discussions on field testing and related
research  (see  Chapters  IV  and  viz  in this  document),  the  application of
biotechnology  products,  to  pollution  control  may  increase  the  Nation's
capabilities for safe  and  effective waste  treatment methods.  In the opinion
of  the  Panel,   the  public  is  generally aware of  the benefits  that  may be
presented  by  the  development  and  use of  biotechnology  products  for  the
control of hazardous and nonhazardous wastes in the environment.

      2.  Use for emergency response

      Indigenous and  selected indigenous  microorganisms  have  been  used for
the  cleanup of  chemical  spills.    Dr.   J.   Exner,   Technical   Director  at
International  Technologies  and observer at  the Workshop,  reported  that his
company has  used  biological treatment  for chemical spills.   He stated that
microorganisms in conjunction  with chemical treatment had  been used in situ
for a  formaldehyde  spill  in northern  California.   The biodegradation  of  a
marine  oil  spill18   has  been   reported  in  the   open   literature, ' and
Pseudomonas  indigenous to  the Nevada  Test Site  has  been shown  to absorb
plutoniura.19   New  biotechnology  products  may enhance  existing  emergency
response capabilities for hazardous substance spills.

C.    Initiatives Suggested to Address Concerns

      Based  on the  discussion by  the Panelists,  several  initiatives  were
suggested to educate and  inform the public  and to address  and alleviate the
public concerns.  These are summarized below.
18   Murakami A et al.  Hakkogaku Kaishi 63(2) :145-152 (1985).
19   Hersman LE.  Abstr.  KN-100, American  Society for Microbiology Meeting,
     Washington, D.C., March 23-28, 1986.
                                    VI-11

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      1.  Recognition of public perceptions by agencies and industry

      The public's  perception of  genetic engineering  and the biotechnology
industry and public  concern  for  the potential risks that may be presented by
these technologies  should be recognized  and  addressed  by Federal regulatory
agencies and  industry.   It was the  general opinion of  the expert Panel that
the  issues  surrounding  the use  of  biotechnology  products  for  pollution
control should be discussed openly and honestly.

      2.  Education of public, academic,  scientific, and engineering
          communities and  governmental agencies

      Since the public's  concerns  about  biotechnology are due, in part, to a
lack  of understanding  of both  scientific   basis  -and  applications  -DC   "."•<*
technology,  the  Panelists celt  chat  a significant effort  should  te  /.ads to
enhance  the  lay  public's understanding  of  basic  biology.   Dr.  Chakr -ib^r ;y
suggested the  effort  be extended  to  include  ensuring that the curriculum of
the present  generation  of students  includes  courses to  expose the students
to  biology,   especially  microbiology  and   genetics.    In   addition  to
                                                7\
scientific   fundamentals,  it  was  suggested  that  the  following information
also be conveyed to the public:

        o The  transfer  of genetic  information  occurs  in nature.
          PIasmids  can  be exchanged  between different  genera of
          microorganisms existing  in close proximity;

        o With respect  to the reproduction of  microorganisms, the
          fact that  soil   and waste  treatment plants are analogous
          to   chemostats;   large  numbers  of  microorganisms  are
          generated in all three;  and

        o Currently,    society    benefits    from   the   use   of
          microorganisms   developed   by   conventional   genetic
          techniques.  Microorganisms  are used to treat wastes and
          sewage,  thus  microorganisms  are  already being  used for
          pollution  control.   The  use  of genetically engineered
          microorganisms may enhance and expand existing microbial
                                     vi-12

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          waste treatment  capabilities and complement nonmicrobial
          pollution control methodologies.

      Dr.  Mellon  suggested  that  field  tests  and demonstration  projects
involving  biotechnology products should be used to acquaint the public with
the potential and specific benefits  of the applications of biotechnology for
pollution  control.   "...Each...application  represents  an  opportunity  to
educate an interested segment of the public...."

      Dr.  Mellon  also  suggested  that  field   testing   sites,  be  carefully
selected.   She  advised  against  the  selection  of  sites  that  are  already
perceived as  hazardous.   She pointed  out that   the  selection of sites where
the local public  has a  vested  interest in the  success  of  the project would
be .advantageous.   This  would foster a  supportive environment and contribute
positively  to the  perception  of genetically engineered microorganisms  for
pollution control.

      The Panel also  suggested  that information  on  the  scientific basis and
potential  applications  of  biotechnology   be   disseminated  to  academic,
scientific,  and  engineering communities,  to Federal, State,  and government
staffs, and  to  environmental public  interest groups.  These  are the groups
to  whom  the  public  might   turn   for  information  and  judgements  about
biotechnology.  For these  groups,  it was suggested  that  information be made
accessible at professional conferences,  seminars,  and via  presentations in
technical journals.

      3.  Maintenance of industry's and USEPA's credibility

      It  was  the  opinion  of  the  Panel  members   that  the  biotechnology
industry  and  USEPA  should  make   efforts  to  maintain  and  build  their
credibility with the public.  Specific suggestions that were made include:

        o Agency statements should be factual*;

        o Applications   and  proposed   applications  should   be
          reviewed on a  case-by-case basis and  discussed with the
          interested public, especially potentially affected local
          groups;  and

                                     VI-13

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        o Care  should  be  taken  In  making statements  regarding
          potential risks and assurances of safety.

      4.  Development  and  use  of  biotechnology-specific  tier  testing  and
          risk assessment methods

      A cooperative  effort  by the  industry,  USEPA, and  academia to develop
specific  methods  for  the   tier  testing  criteria  and  risk   assessment  of
biotechnology  products could help  build  public confidence  in  the industry.
The  Agency,   therefore,   requested  from  industry  and  academia  relevant
information    and/or    data    co    supplement    chat     which   it    is
developing/collecting.   The status  of the  USEPA's database,  tier  testing,
•and risk assessment -are outlined below.

      a.  Database

      There is little  information  available  for use by the Agency during Its
PMN  review process.   To  alleviate  this deficiency,  the  Agency  (OTS)  is
developing  a  database of  organisms, microbial  products,  strain development
techniques  (both conventional  genetic and  rDNA techniques),  and pollution
control  applications  from  the  open  literature.   These   data  may  be  of
assistance  in   assessing  PMN  submissions  and   permit  applications,   in
identifying the  types of data the  Agency  would want in applications and the
classes of products of concern  to the Agency, and in developing  tier testing
criteria.   The   development of  this  database  may  facilitate  technical
evaluations as well as expedite the review process.

      b.  Tier testing

      Under TSCA,  test data on chemicals  can be required for assessing risk
during  PMN  review process.   Several research projects  that  are relevant  -for
the development  of tier  testing  criteria are  being conducted  by the Agency
in  its biotechnology  research  program. .  The  results  of. these  studies  may
assist  the Agency in  identifying the kinds of  tests that it will require for
biotechnology products intended for deliberate  release  in the environment.
                                     VI-14

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      c.  Risk assessment
      in   its   biotechnology  research  program,  the  USEPA   is   conducting
research  directed  towards  the development  of risk  assessment criteria and
methods  for biotechnology  products.   These  are needed  in  order  for the
Agency to review PMN submissions.
                                  VI-15

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        VII.  USEPA's POLLUTION CONTROL-RELATED BIOTECHNOLOGY RESEARCH
      Basic,  generic  applied,  and  applied  research  are essential  for  the
commercialization of  new  technologies.20   These  kinds of  research provide
information   needed    during   the   various    phases   of   the   product
commercialization process.   Historically,  the  Federal  government has funded
basic and,  to a  limited extent, applied generic  research while  industry  has
sponsored applied research.

      The   USEPA   recently  initiated  -a   biotechnology  research  program.
Although  genetically  engineered microorganisms  are the  primary  fscus,   seme
of  the   projects   in   the  -program  involve  .nonengineered  microorgan is-.s.
Research projects that  are underway  or  planned  Ln this program include  basi...-
and generic applied  research in the  areas  of  .nicrobial survival, grcwth.  L^
situ transfer of  genetic  information, dispersal,  biological containment,  jnd
environmental and health  effects.   Those research  projects  that  are related
to  the  application  of  biotechnology   to   pollution   control  were  briefly
described  to  the Panelists  by  USEPA personnel  who  are conducting/managing
these projects.

      The goal of  this  session of the Workshop was to develop ideas on  both
basic  and  applied  research  projects  that  could  enhance  the  study of
genetically engineered  organisms for pollution control.   The Panelists  were
asked  to suggest the  kinds  of research and  development projects  that  the
USEPA  and  industry should  undertake  that would be  the  most  useful  for
pollution control purposes.   In addition,  the  Panelists were also requested
to  develop  a rank  ordered list of  projects that  would be  best suited  for
funding by the government.
20   U.S. Congress, Office  of Technology Assessment,  JH Gibbons  (Director)
     Commercial Biotechnology:  An International Analysis.  1984.
                                     VII-1

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A.    Environmental Research Laboratories, Gulf  Breeze,  Florida
      Dr.  Al  Bourquin described  the  philosophy and Che research orientation
at  the  Gulf Breeze  Laboratories.   Dr. Bourquin  stated  that at Gulf  Breeze,
the emphasis is on understanding...

      "...the    physiological    and    genetic   mechanisms   involved   in
      biodegradation  in  both engineered and nonengineered microorganisms  and
      how   the  rnicrobial   community  functions  in  order   to  promote   :he
      facilitation of degradation, both genetically  and physiologically."

He  also pointed  out  that  the  Gulf  Breeze  biotechnology  research  program
recently  expanded  its  capabilities  in genetics  and physiology  to  i-cr.cucc
••nore  investigations  of  genetic  mechanisms   with  an   emphasis   :-n   risk:
assessment  and  on  the  risks  associated  with  the  environmental  release of
genetically altered microorganisms.

      Dr.  Bourquin  briefly  described some of  the pollution control-related
research projects that  are currently underway.  These include -the catabolism
of  chlorinated  aliphatic  and aromatic hydrocarbons and  the development of
methodologies  to  determine  survival,  genetic  stability,  stress   on   the
ecosystem,  and  other factors that  may be associated  with the assessment of
risks for biotechnology.

      In the studies on waste degradation, a  number of different approaches
have  been  used.    These   include the  use  of  nutrient   supplementation  of
resident raicroflora;  field  testing  to calibrate  biodegradation systems  for
laboratory-developed   jet    fuel   components,   with   an   emphasis   on   the
biodegradation  rates;  and  physical  alterations  of  the  environment  to
facilitate  anaerobic  versus aerobic biodegradation, e.g., flooding, creating
slurries, and agitation.

      Other ongoing research projects at  Gulf  Breeze that  are relevant to
biotechnological approaches  to  pollution  control were also  briefly described
and are summarized below.
                                     Vll-2

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      1.  Detection of biodegrading microorganisms

      Dr.  Ananda   Chakrabarty  directs  a   project   on  the  detection  of
biodegradative  microorganisms  in the  environment.   Further  details  about
this project were not provided.

      2.  Cometabolism of organic compounds

      Dr. Peter Chapman presented  a  brief review of the ccmetabolism  project
he  directs.   In  cometabolism,  the  transformation  of organic  compounds Ls
dependent upon  the  presence of  a second compound.   The underlying basis of
the  cometabolic  process  is  not  currently  understood.    Dr.  Chapman  Is
investigating  the  rp.echanis.-ns  of  .aromatic  hydrocarbon  degradation.    ::-.-!
.aerobic  biodegradat ion  of  t;- .chloroethy lene (TCS)  has been shown  to  '.-.•  i
ccmetabolic process requiring  the  presence  of oher.ol.   The ultimate  ;c.3i3 of
this  project  are  to  determine  whether and/or  what  ccmetabolic   processes
occur in environmental organisms  and  to determine how these  processes may be
manipulated.

      3.  Degradation of  chlorinated  aromatic compounds by  anaerobic micro-
          organisms
      Dr. Barbara  Sharak-Genther  is  investigating  the mechanisms  by  which
anaerobes   degrade   chlorinated   aromatic   compounds.    She  is   currently
developing  laboratory  methods   to   enumerate  and  isolate dehalogenating
microorganisms  from  anaerobic  sediments.    The  genetic  and  physiological
analysis of such microorganisms  may  be  useful  for  advancing the development
of anaerobic chlorinated aromatic compound blodegraders.

      4.  Degradation   of   halo-organic    compounds    -    detection    of
          microorganisms and analysis of degradation pathways
      Dr. Deb Chatterjee,  in Dr.  Chakrabarty's laboratory, is using genetics
to-elucidate the degradation pathways for 2,4,S-T.

      Dr. Michael Nelson  has  isolated a gram-negative, aerobic microorganism
that  mineralizes  TCE.   This  organism  was  isolated  from  an  environmental
                                     VII-3

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sample.   Characterization of the organism  has shown that its  biodegradation
of TCE  is coraetabolic since  the  presence of phenol is required.  Phenol was
present  in  the sample from which  the TCE biodegrader was isolated.   Further
characterization  of the requirements  for and  mechanisms of TCE cometabolism
and a field  test  of  the TCE biodegrader are  anticipated.

      5.  Environmental  impact   -  monitoring  and  assessment methods  and
          biological containment
      a.  Environmental ecology

      Several  projects  are underway  that are  relevant  to the  development of
methods  for  monitoring ecosystems and  for assessing environmental  impact.

      The  group  conducting  ecosystem studies  at Gulf  Breeze  has i!ev= •.-;-oed
laboratory  microcosms  and has  begun  fiald  .tasting and/or field  cai Ibr i: Ion
studies  of these  systems.

      Or.  Tamar   Barkay  is   investigating  the  adaptation  of  microbial
communities  to stress.  As a  model, Dr.  Barkay is developing methods  for the
detection  of  mercury-resistant  genes and  their movement  through microbial
communities  in aquatic ecosystems.

      Or.  Fred  Genthner  is  investigating the  frequency  of  the  conjugal
transfer of  genetic information between aquatic microorganisms in laboratory
microcosms.

      Dr.  Hap  Pritchard  and Dr.  Ellen O'Neil  are developing  laboratory
microcosms for use in predictive studies on biodegradation  rates  in  natural
environments.

      It  was   also mentioned   that   efforts  are  underway   to  adapt  the
sequencing   of 16S  ribosoraal  RNA  for  studying   and  defining  ecological
microbial communities.
                                     vn-4

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      b.  Methods for biological self-containment for released microorganisms

      Dr.  Stephen   Cuskey  is  directing   several   projects  on  microbial
degradation of  hazardous wastes.  In  these projects, an  emphasis is placed
on  the  development  of  methods  that  may  be useful  for  the  containment  of
environmentally   released   biotechnology   products.     Several   potential
containment methods have been developed.

      One method  involves  the  use of a  temperature-sensitive mutation in an
ultraviolet-irradiation-resistant  gene.   The  presence  of this  mutation  in
microbial  cells  would  confer  sensitivity  to sunlight  at  the   restrictive
temperature.   For example,  the  inclusion of a cold-sensitive mutation in the
ACG3 strain  (ice nucleation strain  developed by Advanced Genetic Sciences)
would make  these cells  more  sensitive  to  sunlight  at  colder   temperatures
than at warmer temperatures.

      Another method  that   is  under  development is  the  cloning  (genetically
engineered placement  of)  the genes  for  the uptake of mercury on a plasmid.
For  biodegradative  microorganisms harboring this plasmid,   the  addition  of
sublethal concentrations of mercury can be  coordinated  with the  elimination
of  targeted  hazardous  substances  from  the  environment.   Thus,  in  the
presence  of  mercury,  biodegradative microorganisms bearing this  plasmid
would be selectively killed.

      A  third  method involves  the construction and  use  of  a plasmid-borne
"suicide cassette" which would  ensure the self-destruction of microorganisms
harboring  these  plasmids.   A  "suicide  cassette"  would  encode  genetic
information for  the  constitutive production of a killing factor  and genetic
information  for  a  protecting   factor.   Expression  of  the  gene(s)  for  the
protecting  factor  is  regulated  by  a   predetermined   promoter.   When  the
promoter that  controls  the production of the protecting  factor  is specific
for a particular  pollutant,  microorganisms harboring "suicide cassettes" are
protected for as  long as the pollutant  is  present  in their environment.  In
the absence of  the pollutant,  i.e.,  through biodegradation,  the gene for the
protecting factor is not  expressed  and  the  constitutively  produced killing
factor  is  lethal for  microorganisms  harboring  a   "suicide cassette."   A
"suicide  cassette"   specific for  the  pollutant  3-chlorobenzoate  is  being
                                     VlI-5

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developed  using the  plasmid pEPA22  and a  promoter specific  for 3-chloro-
benzoate.

      Based  on  the  specificity  of  the  promoter   that   is  employed,  the
"suicide  cassette"  method has  potentially wide  applicability.   In addition
to promoters specific  for  a  variety of pollutants, promoters that respond to
light or to the presence or absence of oxygen may be used.

      The  "suicide cassette" may also be used by biotechnology companies for
the protection  of  their proprietary rights.  Dr.  Cuskey  stated that "people
like Mr.  Dardas could start accepting  those  $250,000 contracts if they knew
that the  clients could sift (through  the)  soil for a  long time  and not get
the Detox process."

B.    Hazardous Waste  Engineering Research  Laboratory,  Extramural .Research,
      Cincinnati, Ohio

      Mr.  Venosa  briefly  reviewed  four  extramural  genetic  engineering
projects  that  are  being funded  by the  Hazardous  Waste Engineering Research
Laboratory  and  that  are  currently  underway.   One  of   the  four  projects
involves biodegradation while the other  three are basic research.

      1.  Chlorinated   organic   compounds   -    development   of   anaerobic
          biodegraders
      Dr.  George Pierce  at  Battelle  in Columbus,  Ohio,   is  directing this
project  to  develop  strains  of  anaerobic  microorganisms that  biodegrade
chlorinated organic  compounds.   This project has been  underway  for 2 years.
One  such  anaerobic  microorganism  that  dechlorinates 3-chlorobenzoate  has
been  isolated.   Efforts  are  currently underway  to  identify,   clone,  and
sequence the genes involved in 3-chlorobenzoate dechlorination.

      2.  Microbial-binding proteins -  isolation and characterization

      Dr.  Clem  Furlong  at  the  University of  Washington   at  Seattle  is
directing  this  project.   Microbial-binding proteins reversibly  conjugate
                                     VII-6

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ligands for  which they  are  specific.   These  proteins may,  therefore,  have
applications  for  the  selective  removal  of  pollutant  ligands  from waste-
waters and sludges.

      The  pollutant  phosphate  causes  putrification  in  lakes  and  streams.
The gene  for  an Escherichia  coli (E. coli) protein that  binds phosphate has
been cloned  onto a multicopy plasmid and introduced  into  an E. coli double
mutant.  One  mutation  involves  the cell wall and  allows  the binding protein
to leak out  of the cells.  The second  mutation confers a phosphate require-
ment  and   causes  the  cells  to  constitutively overproduce  the  phosphate-
binding protein, e.g., 70 percent of  the cells' protein is phosphate-binding
protein.   Cells  bearing both of  these mutations  constitutively produce and
release the  phosphate-binding protein.   This  protein can  then be extracted
from the culture medium,  immobilized,  and  used  to  remove  pollutant phosphate
from wastewater.

      Cadmium-binding  proteins  have  been detected   in  E.  coli and  other
organisms.  Efforts are currently underway to develop methods for the use of
the cadmium-binding protein to remove cadmium from wastewaters and sludges.

      3.  Enhancement of microbial nitrification

      Dr.   Michael  Carciotes  at  the university  of  Cincinnati  is directing a
project  that  focuses  on enhancing   the  nitrification  process  in  micro-
organisms  by  either  increasing  the  nitrifier's   intrinsic  growth  rate  or
increasing  the  rate  of nitrification.   The   latter may  be  achieved  by
stimulating  or  enhancing the  enzymes  responsible  for   the  oxidation  of
nitrite to nitrate.   As  a  first  step,  the  genetics  of nitrifiers  is  being
studied.   To  date,  the leucine  B gene  from a nitrobacterium has been cloned
and  expressed   in  E.  coli.   Efforts  are  underway  to  reintroduce  and
characterize the expression of this gene in the nitrobacterium.

      4.  Elucidation of the  mechanisms of methanogenesls

      Dr.   John Reeve  at Ohio  State University is  directing a  project  to
elucidate  the  mechanism by which microorganisms produce methane from carbon
dioxide and hydrogen.  Efforts are being directed  towards  the cloning of the
                                    VII-7

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gene  for  the terminal enzyme  in  methanogenesis,  methyl coenzyme, and methyl
reductase  activity  in E_._  coli.    Efforts  are  also being  directed  towards

characterizing   the  enzyme  with  respect  to  its  activity  at   different

dissolved   oxygen   concentrations,   pH  levels,   and   other  environmental

stresses.   Once  the  mechanism  of  methanogenesis  is  understood   and  the

pertinent  genes are identified and cloned, it may be  possible to  alter  the

genes,  introduce the  altered genes  and into  methanogens  that  are  already

adapted  to particular  environments;  this  may  result in  the  development of

more useful methanogens.


      In  response  to  questions  from the  Panelists, Mr.  Venosa  pointed  out

several  possible technological  advances and  benefits  that may  also result

from the latter two research projects:


           1.  The  enhancement of nitrification  could  reduce  the
              costs associated with  nitrification,  e.g.,  smaller
              and/or less expensive reactors may become feasible.

           2.  The  insights  gained  from work on  nitrification may
              be  transferable/exploitable  for  the  enhancement of
              oxidation of  ammonia by heterotrophs.

           3.  The  elucidation of  the mechanisms  of nitrification
              and methanogenesis  may facilitate the development of
              these traits  in  other more tractable  microorganisms.

           4.  Information   gained    during   the   tailoring   of
              methanogenesis  genes  may allow  the stabilization of
              this   process   with   respect    to   environmental
              conditions, e.g., fluctuations in oxygen and pH.


C.    Hazardous Waste  Engineering Research Laboratory.  Intramural  Research,
      Cincinnati. Ohio


      Mr.  Pat  Sferra,  Project Officer,  briefly described projects  involving
microbial  degradation  of pollutants  that  are  underway at  or  funded by  the

Hazardous  Waste Engineering Research Laboratory.


      1.   Construction of biodegradative microorganisms


      Dr.  Chakrabarty  will head  a  project  to  construct  microorganisms that
will  biodegrade  targeted   chemical  pollutants.  Dr.  Chakrabarty will  also
                                     vil-8

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direct a  project  at Gulf  Breeze  Laboratory aimed  at  detecting biodegrading
microorganisms.

      2.   Microbial degradation of polychlorinated biphenyls

      In a collaborative effort. Dr.  David  Gibson at the University of Texas
has   been   funded  to   study  one   aspect   of  microbial   degradation  of
polychlorinated biphenyls  (PCBs)  mediated by  strain LB-400,  a microorganism
developed by  General Electric  (GE).   GE will  study  another aspect  of PCB
degradation.

      3.   Plant uptake of hazardous wastes

      As a  visiting scientist,  Dr.  Robert  Bell, who  is  affiliated with the
University of  Liverpool, will investigate the uptake  of  hazardous wastes by
plants.   In this  study,  the ability  of plants  to remove  and/or detoxify
pollutants from the environment will be assessed.

      4.   Degradation of chlorinated organic compounds by white rot fungus

      Dr. Steven  Aust  of Michigan  State  University is being funded to study
the degradation of organic compounds  by  the white  rot  fungus,  Phanerochaete
chrvsosporium.  To  date, the  compounds degraded  by this microorganism include
these chlorinated  hydrocarbons:  dichlorodiphenyltrichloroethane; tetrachloro-
biphenyl;   hexachlorobiphenyl;    p-chlorobenzoic   acid;    poly-chlorinated
biphenyls;  and 2,3,7,8-tetrachlorodibenzo-p-dioxin.   This microorganism  has
also  degraded  benzoic  acid,  cyclohexane, biphenyl, and  benzo(a)pyrene.   The
white  rot  fungus  degrades  most of these compounds slowly  and  at different
rates.  This  microorganism   has been proposed for  field  testing,  originally
on  private  property,   but  now  at  a military site.   It  seems  that  the
permitting process  is posing  a barrier to  the field testing  of  the white rot
fungus.

      Through  an   Interagency agreement.   Dr.  E.  Kent  Kirk  at  the  Forests
Research Laboratory, United  States Department of Agriculture,  Wisconsin,  has
been funded to conduct  survivability tests with the white rot fungus.
                                     VII-9

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      In  summarizing  the  potential  applications for  genetically engineered
microorganisms  (GENS),  Dr. Cuskey pointed out  several  of their technological
advantages.   GEMS can  be constructed  that  have  increased  efficiency and/or
rate  of  the  degradative  process.   This  can  be accomplished  by increasing
enzyme  production.   Using  genetic  engineering  technology,   the  regulatory
controls  of  degradative  enzyme  production  can  be  manipulated,  and  altered
degradative   enzymes   and   new  degradative   pathways  can  be  designed  and
constructed.   Genetic  engineering  may  also  be  used  for   the  biological
containment of microorganisms released in the environment.

      Finally,  Dr.  Bourquin pointed  out  that  the development  of genetically
engineered  microbial  products  for  pollution control would  not be immediate,
and  that  microorganisms developed with  traditional  genetic techniques, those
not  involving the transfer of  genetic  information,  could be available sooner
for pollution control applications.

      In  response  to  the  presentations of  these projects,  Dr.  Caldwell
commended	
         " — the   EPA   for  working  on   genetic  techniques  for
         containing  organisms  and genes  as  opposed  to  physical
         techniques,  also  for  developing  genetic  methods—to
         monitor   the   dispersal   of   microorganisms   in   the
         environment.   Given  all the  ecological  complexities,  I
         just  don't  think  it's  possible  to physically contain a
         gene  or  microorganism that  might  result in harm—but you
         can  greatly decrease the  probability  if you have some
         genetic  safety  mechanisms and  if  you've done your best to
         develop  them."

      The  role  of  USEPA's  research  in  the  development of  biotechnology
products for pollution  control was discussed briefly  by  the  Panelists.  The
general opinion  of the  Panelists was  that USEPA  should continue to conduct
the  kinds  of  biotechnology-related  research  that  are  not  underway  in
academia  or   industry,  especially  in  the  areas  of  basic  and  scale-up
research, environmental  survival/persistence and  impact,  field  testing, and
in health risk assessment methodologies.
                                    VII-10

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      This opinion was best summarized by Dr. MelIon's comment:


         "EPA ought  not  do  anything  that  anybody else  is doing.
         Resources are limited  	 EPA  ...  ought  to be filling in
         the research gap ....  It seems to  me  that  there is a gap
         ...  (in)  the  research  phase of  R&D, (of)  particularly
         desirable technologies,  and  there  is  also a very large
         and agonizing gap in  (the)  development of risk assessment
         methodologies."


      Moreover,  in Dr.  MelIon's opinion,  the  projects that are  underway in
the USEPA  biotechnology  research program  could help to  fill  several  of the

existing research gaps.   She suggested that...


         "...much of  the  basic and applied  research  that has been
         presented'is at  a stage that you  (the USEPA researchers)
         could move  into  the microcosm  testing, especially in the
         soil degradation systems, without  going to  the field; and
         at  that  time the experiments should be designed with the
         appropriate    controls   to   begin    to   delineate   the
         (potential)   improvements  that (the use of)  a genetically
         engineered  organism   could   make  over  conventional  or
         indigenous organisms.. .No one in  industry nor in academia
         is going to have any  incentive  to do  the  kind of research
         that is  necessary  to  assess the  ecological effects * of
         release of  these organisms nor are they  going  to do the
         kind of work that's going to be necessary  to develop the
         battery of tests that  the applicants are  going to have to
         do to provide EPA (with)  information on which it can make
         a decision as to whether or not the technology is safe."

      It should  be pointed  out that  these  kinds  of studies  are  needed for

the development of testing criteria and for demonstrating  and comparing the
effectiveness  of  biotechnology  products  (engineered   and   nonengineered

microorganisms)  for pollution control.


      The  relevance   of  the  projects  that  is  underway  in  the  USEPA's
biotechnology research program  and  the potential for  its  application  to the

protection of pollution  control  industry's  proprietary  rights  prompted Mr.
Dardas to state  that  his company


         "...will immediately begin working  on  genetic engineering
         in order to give ourselves more protections  of all of our
         proprietary  development....as soon as we can afford to."
                                    vil-11

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      Dr.   Omenn  summarized   the  discussion   on  the   role   of  USEPA's
biotechnology  research  program in  the  development  of biotechnology products
for pollution control as follows:

         "It is  clear that there is a  role for EPA here,  that the
         companies  have hot  and by all  counts  will  not,  exploit
         genetically  engineered modifications  until  someone else
         demonstrates   that   the  organisms  are  ready,   and  the
         techniques are easy, and the need  is there."

      As discussed  in Chapter V of this document, the need for research, the
lack  of  risk   assessment  methodologies  and   testing  criteria,  and  the
significant  costs  of  research  pose   technical  and   economic   barriers  to
commercialization  of biotechnology pollution  control  products.   Moreover,
the continuation of  limited  expenditures  for generic applied research by the
government  may  widen  the  gap  between   basic  and  applied  biotechnology
research, and  this  may also  retard  the commercialization of biotechnology
products.   Since basic  and  generic applied research  are  critical  for the
development of  this  industry,  the Panelists felt  that  USEPA's  research  is
critical  for   fostering and  facilitating  the  development   of biotechnology
products for pollution control.

      The Panel decided against developing  a rank order list of research
projects that are best suitable for governmental funding.
                                    VII-12

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                               VIII.  SUMMARY

      Consistent  with  its  mission  to  protect   the  environment  and human
health,  the  USEPA  is exploring  new technologies  that may  have potential
applications  for  the safe,  effective,  and economical  removal  of hazardous
substances  from  the  environment.    In  addition  to  chemical  production,
conversion  of  biomass  for  energy,  and  agricultural and  pharmaceutical
applications,  biotechnology products  (either  engineered  and nonengineered
microorganisms  or  their  cellular   products)  may have  pollution   control
applications.   Potential  technological  advantages  that may  be  achieved by
the  development  of  biotechnology  pollution control  products  include   the
direct   treatment  of  hazardous  substances  in  waste  sites,   landfills,
effluents, groundwater;  as alternatives and complements  to existing waste
treatment methods; and  the  expansion of  the Nation's toxic waste treatment
capabilities.

      The   commercialization   of   genetically   engineered   biotechnology
products for  pollution  control  is slow  when compared to the development of
biotechnology  products  for other   markets.   To  address  this  issue,   the
Offices  of  Toxic  Substances  and Policy,  Planning,  and Evaluation  (USEPA)
convened  the Workshop  on  Biotechnology  and  Pollution  Control  to identify
and  examine   factors  that  influence  the  development  of  biotechnology
products for  pollution control.  The major  findings  and recommendations of
the expert Panelists who participated in this Workshop are summarized below.

      During  this  Workshop,  technical,  economic, and  regulatory barriers to
the commercialization of biotechnology products  were  identified.  Technical
barriers include  field  testing  issues,  the need  for  field tests and basic,
generic  applied,  and  applied  research, and the  need  for the development of
risk  assessment criteria and  methodologies.  Economic barriers  that  were
identified   include   the   significant   costs   associated   with  research,
development,   and  commercialization  of  biotechnology  pollution  control
products  and   the  industry's  costs  for  indemnification  and  liability
insurance.   The Panelists  identified  the barriers  that  are  presented by
regulatory  policies  and  reporting  and  permitting  requirements  at   the
Federal, State, and  local  levels.   Finally, adverse  public response, which
is based on  the public's concerns and perceptions of  the risks presented by
                                    VIII-1

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the  applications  of  biotechnology,  was  also  identified  as  an  existing
barrier.

      Field  testing  is a necessary  early  step In  the commercialization of
biotechnology products for pollution control.  Technical  barriers  to field
testing  include  the  lack  of defined site  selection  criteria,  testing and
evaluation   standards,  and   environmental   impact   and   risk  assessment
criteria.   In addition, standardized  methods for  containment, monitoring,
emergency  response,  and  risk assessments have  not been  developed.   These
barriers  are all  associated  to  some  extent with a need  for. additional
research.   For example,  research is needed  to define  and  evaluate the risk
that  may  be  associated  with  the  environmental   release   of  genetically
engineered  microorganisms.   The results of  such  research  could be utilized
to define criteria for selecting field test  sites.

      Basic,  generic applied,  and  applied  research are needed.   The costs
associated  with  conducting biotechnology research are significant,  and this
tends  to discourage  the  performance of relevant  research  and  hinders the
development  of methodologies needed to  design, monitor,  and evaluate field
tests  and  for assessing risks.   Traditionally,  basic and  generic applied
research have been sponsored by the  government,  while the research involved
in  the  commercialization  of  products has  been   performed  by  industry.
Although  the government is committed to funding  basic research, government
expenditures  for generic applied  research  have  been  limited.  A  need for
generic  applied  research has  resulted,  and  this need for research retards
the  development  of  biotechnology  products.  Finally,  the  Panelists  felt
that  until  the  efficacy  of biotechnology  pollution  control  products has
been  demonstrated,  the biotechnology   industry  will  probably not  invest
large amounts of capital in applied/developmental biotechnology research.

      Federal, State,  and local regulatory  policies pose  barriers  to field
testing  and thereby  to the development  of commercial  genetically engineered
biotechnology  products.   Permitting  and  reporting  requirements  and  the
uncertain  regulatory climate were identified  as  additional  barriers  to the
development of the biotechnology pollution control  industry.
                                    Vlll-2

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      The public  has  vague concerns  about  the risks  that  may be presented
by the  use  of biotechnology products.   The Panelists  felt  that the public
does   not   usually  perceive   a   distinction   between   engineered   and
nonengineered microorganisms  and  that  the public does not  understand the
scientific basis  or applications of biotechnology.  These deficiencies pose
a barrier to the  public's ability  to evaluate  the issues raised by and the
risks  associated  with   biotechnology.    In   addition,-  the  expert  Panel
identified other  public concerns.   These concerns  involve  the credibility
and capabilities of industry and regulatory agencies to identify and assess
potential risks presented by biotechnology and how risks  and benefits are
balanced in  the decision-making process,   if  the  concerns of  the public are
not  addressed,  this can  lead  to  adverse public  response  that may  pose  a
barrier  to commercialization.   The public's  response  is most  likely  to be
expressed by the local population near field testing sites.

      Finally, members  of  the  biotechnology  industry  identified  concerns
that they perceived as barriers to the  development and use of biotechnology
pollution control products.   These  concerns  were  for  the  protection  of
their proprietary rights and for the  costs  of indemnification and liability
insurance for field testing and  use.  These perceived  barriers may lead to
a reluctance on the part  of the industry to  conduct field tests and pilot,
demonstration,  and/or  cleanup  biotechnology   projects.   The  industry's
concerns,  therefore,   may  pose   barriers   to  the  commercialization  of
pollution control  products.

      Several advantages  for applying microbiological  products to pollution
control  were identified  by the  Panelists.  These  advantages  include  the
ability to:

      1.  Develop   strains  with   enhanced   activity   in   specific
          degradative  enzymes
      2.  Develop   strains  whose   functional   activities  are  less
          susceptible  to environmental conditions;
      3.  Develop   strains  capable  of   withstanding   highly  toxic
          environments;
      4.  Develop  potentially controllable microorganisms;
                                    Vlll-3

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      5.  Develop  genetically marked  strains  that are  intended for
          deliberate   release   in  the   environment   (this  would
          facilitate  the  monitoring  of  survival  and  dispersal  as
          well as protect proprietary  rights); and

      6.  Develop  strains that  are safer  than  naturally  occurring
          and nonengineered strains.


      Although  these  benefits  may  be   achieved  by  the  use  of  either

nonengineered  or  engineered  strains  of  microorganisms, the  Panelists  felt

that  they  could  be  more  directly  achieved  with   genetically  engineered

microorganisms.   In the  Panelists' opinion,  microbiological  approaches  to

waste  treatment  may  become  more  cost  effective than  conventional  methods

once the biotechnology pollution control  industry  is more fully developed.


      During  discussions  in  this  Workshop, strategies/incentives  to reduce

the  various barriers  and possible  incentives  for  the  commercialization of

biotechnology  products for  pollution  control  were  identified by  the Panel

members.


      The recommendations that  were made to reduce  the  barriers and provide

incentives for field testing  included:


      o   Use of  existing contaminated sites for field  tests.  Many.
          such sites  have been  identified  and  characterized to some
          extent   with   respect    to   contaminant   identity   and
          concentration  and  are presently being  monitored.   Use of
          existing  sites  may facilitate the selection of appropriate
          microorganisms,   reduce   industry's   costs,   and  expedite
          field testing;

      o   Performance  of  demonstration   projects  to  compare  and
          evaluate     biodegradation    by    microbiological    and
          conventional methods.  Such  studies can help to assess the
          "best  demonstrated available   technology"  and demonstrate  .
          the   efficacy   of  microbiological    pollution   control
          technology;

      o   Use  of   nonengineered  microorganisms   in  Initial  field
          tests,   e.g.,   microorganisms   developed   for   enhanced
          production of degradative enzymes.   This would demonstrate
          the efficacy of microbiological pollution control products
          without  regard  to  the  concerns  that  are  associated with
          genetic engineered  microorganisms; and
                                    VIII-4

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      o   Development of a Federal field testing program under
          RCRA/Superfund.  This may reduce industry's cost and
          expedite field testing, thus promoting the
          commercialization of biotechnology pollution control
          products.


      To reduce technical and economic barriers and to provide economic

support mechanisms and incentives that are directed towards the alleviation

of technological deficiencies, the following Initiatives were suggested:


      o   Increase the government's funding of generic applied
          research, to use government funding to promote applied
          research to develop risk assessment methods, and to
          continue research underway in the USEPA's biotechnology
          research program.  These actions may alleviate some of
          research needs and address, in part, the costs of such
          research;

      o   Use of Small Business Innovative Research Program funding
          to promote and support applied research and
          commercialization;

      o   Use of low-interest government loans to promote and
          support developmental research and commercialization;

      o   Government funding of comparative evaluation laboratory
          and field studies to assess the "best demonstrated
          available technology" and demonstrate the efficacy of
          microbiological pollution control technology; and

      o   Government supplementing/underwriting or otherwise
          partially offsetting the industry's costs for
          indemnification and liability insurance.

      Recommendations that were made to reduce regulatory barriers and

provide incentives for technology development included:
          Guidance from the regulatory agencies suggesting that
          waste generators and waste management organizations
          consider biotechnology as an alternative to conventional
          treatment methods;

          Full implementation of the existing Superfund and RCRA
          statutes regarding waste management.  This may induce more
          interest in effective and economical waste management
          methodologies by industry;

          Use of legislative incentives to promote microbiological
          alternatives to conventional waste management methods and
          to provide economic disincentives for inadequate waste
          management; and
                                    VIII-5

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      o   Granting of  variances  in  regulatory policies  in  order to
          foster the development of new technologies.


      Finally,  to  address the issue of public perceptions that pose

barriers  to  the  development  of  biotechnology  pollution  control

methods, the Panelists suggested  that:


      o   Efforts be  undertaken by the Agency and  industry  to build
          and maintain their credibility with  the public;

      o   Cooperative  efforts  be   made   to  educate,  inform,  and
          involve   the   public,   the   academic,   scientific,   and
          engineering    communities,    and    regulatory,    agencies
          personnel  with  respect  to  the  scientific  basis of  and
          applications  for biotechnology, i.e.,  developing  a Center
          for Environmental Biotechnology; and

      o   Field tests be  used  by  the Agency to educate, involve, and
          inform   the   public  about   the  potential   benefits  of
          biotechnology products.


      In the  opinion of  the expert Panelists,  the  implementation  of these

suggestions may overcome  existing barriers and/or act  as  incentives for the

development  and commercialization  of biotechnology products  for  pollution

control.
      Dr. Omenn's summary  of the major findings of this Workshop is provided
in Appendix A.
                                    Vlll-6

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            APPENDIX A
DR. OMMEN'S REPORT ON THE WORKSHOP
                A-l

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                             university of Washington
                               Seattle. Washington 98195
              school of public health and community medicine
                                             March 25,  1986
                                                                   office of the dean, sc-30
                                                                   (206)543-1144
The  Honorable Lee M. Thomas
Administrator
U.S.  Environmental Protection
  Agency
401  M Street, S.W.
Washington,  D.C.  20460

Dear Lee:

     1 had the  pleasure of  chairing  EPA's  Workshop on  Biotechnology  and
Pollution  Control this past week  (20-21  March, 1986, in Bethesda).   EPA staff,
led  r>/ Jodi  Bakst,  prepared  very well  for  the meeting and gathered a  strong
pc?.nel.   There was a good group of  obsecvers,  including a contingent from EPA.
And  Don  Clay offered  the Panel a helpf.;!  informal question and  answer  session
during the first evening.

     Jodi Bakst,  Ron Evans, and other IvIPA staff  will draft  a report from the
Workshop.   In  the meantime, however, 1  thought it might  be useful  to you and
such  colleagues  as  Jack Moore, Henry Ix>ngest, Marcia  Williams,  Don Clay, and
Jim Barnes to have a brief report directly from me.

    The  following are  our main conclusions:

1.  The  Nation  needs  alternative technologies to complement present "burn or
bury"  approaches  to chemical  pollutants.    There are  many  high priority pol-
lutant  targets   in  landfills,  hazardous  waste- sites,  industrial  effluents,
groundwater,  and other  media  for which  microbial techniques  could  be,  or
already  are,  helpful.   The  approach  must respect particular  properties  of
specific sites.

2.  within the  microbiological treatment arena,  improvements are needed, some
of which might  draw upon genetic engineering methods.  We  should be alert to
the  risk that reporting requirements or regulatory  approvals beyond what are
definitely necessary  to  build public confidence  may inhibit  desirable  techni-
cal  developments.   At  present,  none  of  the industry  participants  in our
Workshop plans  to introduce improvements with genetic engineering  techniques,
because  of the  likelihood of  overwhelming  regulatory procedures  tied  to the
technique,  rather than the product or any defined risk.
   Emblem: "Soul Catcher"... a Northwest Coast Indian implement used by shamans or spiritual healers to ward off spirits that brought physical
   or mental illness. These instruments were usually carved from the long bones of large animals and handed down from generation to generation.
                                         A-2

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The Honorable Lee M. Thomas
March 25, 1986
Page 2
3.  EPA's  regulatory scheme  and  stimulation  of  innovation should  encourage
stepwise  testing,  first  in  laboratory  scale  experiments,  including- various
kinds of  microcosms, and  then  in well-selected field  sites.   Our Panel  sug-
gested an  array  of criteria  that  should  be applied to the  assessment  of  pro-
posed field tests.   Landfills received special attention, with  advantages  and
disadvantages clearly outlined.

4.  Federally-designated  field  sites  are  considered  essential.    Innovators
need assistance  in matching  microorganisms  with  potential  for  pollution  con-
trol  to well-contained  and  monitored sites  where  the  results  may be  most
credible.

5.  Cooperation  between EPA and developers of  the technology and the  public at
large should be fostered in a variety of aspects:

    o   Balancing regulator/ objectives with pollution control objectives.

    o   Building  the Research and  Development agenda  and  identifying  sites for
        field tests.

    o   Identifying organisms and  test- sites that  would  be the. equivalent  of
        FDA's  "generally  regarded as  safe  (GRAS)"  and  identifying  chemicals
        that  rank high on RCRA, CERCLA, and other  EPA  media-specific lists  of
        problem pollutants.

    o   Communicating what is known and  what  is sought  to  be learned to  the
        public, especially the  interested  public  in the local areas  where  any
        test or field application would be undertaken.

    o   Providing  incentives  via  requirements  to  evaluate microbiological
        approaches to  clean up  site«? or prevent contamination of media.
        Superfund RI/FS protocols  should require detailed evaluation  of micro-
        biological  approaches,  whether   assisted  by  genetically-engineered
        modifications or  not.   Too often potentially attractive alternative
        technologies are  dismissed out of hand by  contractors and consultants
        who simply  are not  familiar with the possibilities.   Likewise,  EPA
        regional  reviewers of proposed technological options must be informed
        about the prospects  and  encouraged to look  out  for sites where  such
        applictions might prove attractive.
                                       A-3

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The Honorable  Lee M. Thomas
March 25,  1986
Page 3
     I  hope that  this  brief  summary whets your appetite for the full report  and
that some  initiatives  may be considered  in the interim.   I would be pleased to
meet with you  or your  colleagues  if  that would be  helpful.   Copies of this
letter will be  sent  to the  individuals named below.

     Best wishes.

                                            Sincerely yours,
                                            Gilbert S.  Omenn,  M.D.,  Ph.D.
                                            Dean,  School of Public Health
                                              and Community Medicine
GSO:lc

cc: James Sarnes
    John Moore
    Henry Longest
    Don Clay
    Marcia Williams
    Tbdi Bakst
   'Ron Evans
                                      A-4

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        APPENDIX  B
WORKSHOP BACKGROUND PAPER
          B-l

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                 EPA WORKSHOP

                      Oil

     BIOTECHNOLOGY AMD POLLUTION  CONTROL
              Hire* 20, 21,  1986
        The Office of Toxic Substances
The Office of Policy, Planning,.and  Evaluation
                      B-2.

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                     BACKGROUND PAPER TO  THE WORKSHOP
The Office of Toxic Substances (OTS),  in cooperation with  the Office of
Policy, Planning, and Evaluation, has  designed a workshop  entitled Bio-
technology and Pollution Control to examine specific regulatory, commer-
cial, and technical barriers to the commercialization of biotechnology pol-
lution control products.  OTS, which is responsible for regulating various
types of genetically engineered and non-engineered organisms,.including
those for pollution control, plans to  use the workshop to  obtain necessary
information to aid the Agency in implementing its regulations.  Further-
more, the workshop is to be a forum where industry and academic experts
explore existing and potential incentives to promote product development.

The Office of Toxic Substances will soon be publishing its policy statement
on biotechnology as part of an overall Federal strategy.   (We will be
sending a copy of the policy statement when it is published.)  One of the
major obstacles to effectively Implementing the Agency's policy is the lack
of information on how to evaluate the  field testing of pollution control
organisms.  Field testing Is usually a necessary and critical step towards
commercializing pollution control products.  Field testing Is also the
first point in the commercialization process where, depending on the tech-
nique used and the type and amount of the organism to be field tested, the
Agency may have to evaluate and potentially regulate the field testing of
the pollution control organism.  (As such, the Agency wishes to gather
information on criteria for selecting field testing sites, containment
techniques, monitoring and emergency response methods and  incentives for
field testing.

OTS nas designed the second day of the workshop to focus more broadly on
the barriers to the commercialization of biotechnology pollution control
products.  The Agency recognizes that there are regulatory, commercial, and
technical factors inhibiting the growth of this area of the biotechnology
industry.  As such, the goals of this section are:  for OTS to gather addi-
tional information to aid the regulatory decisionmaking process; for the
                                   B-3

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Agency, Industry,  and academic experts to discuss how they can work
together to develop better data and to expedite  reviews; and for industry
and academic experts to explore existing and potential incentives to
promote product development.

Since the mid-1970's there have been varying degrees .of opposition to tne
development of biotechnology.  Recently, a major ongoing dispute is witn
the release of genetically engineered organisms  into the environment.
Because biotechnology pollution control organisms will, in many cases, be
released into the  environment, public opposition is likely to arise.  To
help ensure there  is an ongoing exchange of information, the latter part: of
the second day will be spent discussing the most effective ways industry,
academia, and the  Agency can best inform the public of the risks and bene-
fits associated with this technology for pollution control.

The specific issues to be discussed can be found in the section titled
Questions for the  Expert Panel.
                                    B-4

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                      QUESTIONS FOR THE EXPERT PANEL
Purpose:  To compare and devise strategies and incentives for field testing
          genetically engineered and non-engineered pollution control
          organisms, and to discuss how to evaluate and promote the product
          development of these organisms.
Field Testing

     1. What criteria have industry and academia used in the past to select:
        field testing sites for non-engineered organisms?  What criteria
        Mill be used in the future to select field testing sites for both
        genetically engineered and non-engineered organisms?   If differ-
        ences exist, why have they come about?

     2. Some experts have suggested that existing disposal sites, land-
        fills, etc., be designated for field testing genetically engineered
        and non-engineered pollution control organisms.  What would be the
        advantages and disadvantages?

     3. What does Industry and academia consider to be characteristics of
        containment with respect to the field testing of engineered and
        non-engineered pollution control organisms?

        Could greenhouses, sewage treatment facilities, lined landfills,
        and land oil wells be considered:

        a)  contained environments, or
        b)  field testing sites?

        Why or why not?
                                   B-5

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     4. Is it possible to develop a "risk gradient" of containment levels?
        What factors must be considered?  Can industry characterize a "low
        risk" testing site? Why or why not?

     5. What monitoring and emergency response methods are presently used
        for unexpected spills of non-engineered pollution control
        organisms?  What monitoring and emergency response methods do
        industry and academia plan or foresee using with the field testiny
        of genetically engineered pollution control organisms?

     6. What would give industry an incentive to field test?
Product Development

     1. How can the benefits of genetically engineered pollution control
        organisms be evaluated?  Are the benefits significantly different
        from those associated with current pollution control technologies?
        If yes, in what ways are they different?

     2. How can EPA, Industry,, and academia work together to establish data
        on risk and to expedite reviews?  For example, can Incentives be
        provided to encourage Industry to notify the EPA of research and
        development progress for genetically engineered products in advance
        of PMN submissions?  Similarly, can Industry suggest categories of
        products they consider to Inherently present a low risk?  What
        other Ideas could be developed?

     3. What Innovative financing techniques exist to aid in the develop-
        ment of genetically engineered organisms for pollution control?
        For example, what is venture capital's role?  How can the SBIR
        (Small Business Innovation Research) program be used more effec-
        tively?  Are collaborative research ventures within industry a
        viable option?  What other avenues are available?
                                   B-6

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     4. What kinds of research and development should the EPA and  Industry
        undertake which would be the most useful for pollution control pur-
        poses?

     5. What are the key technical barriers to developing pollution control
        organisms?
Public Perceptions

     1. What are the most effective ways industry and the Agency can best
        inform the public of the risks and benefits associated with usiny
        genetically engineered organisms for pollution control?
                                   B-7

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   APPENDIX C
WORKSHOP PROGRAM
      C-l

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    UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
              WASHINGTON. D.C. 20460
              EPA WORKSHOP
                    ON
BIOTECHNOLOGY AND POLLUTION CONTROL
              MARCH 20, 21, 1986
             The Office of Toxic Substances
         The Office of Policy, Planning, and Evaluation
                    C-2

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                         ANNOTATED AGENDA

         BIOTECHNOLOGY AND POLLUTION CONTROL EXPERT GROUP

                         MARCH 20 AND 21
Thursday, March 20

8:30  a.m.   Coffee

9:00  a.m.   Welcome:  Jodi Bakst

             Opening remarks
             Introduction of Dr. Gilbert Omenn as Chairperson and
             Jodi Bakst as co-chair.

9:05  a.m.   Introductory remarks:  Dr. Gilbert Oraenn

             Participants introduce themselves

             Explain agenda - There will be approximately 55
             minutes for each question.  The workshop
             chairperson, at the close of each question, will
             summarize the major points discussed.  The
             proceedings from the workshop will later be
             summarized into a formal paper and distributed to
             the participants and observers.  An effort will also
             be made to make the paper available to the public.

             Role of participants - The participants were not
             asked to prepare formal papers, but rather succinct
             answers for a practical discussion of the major
             issues associated with each question. '

             Role of observers - Observers will be recognized by
             the chair for 30 minutes at the end of each day to
             make comments or ask questions for clarification.

9:15  a.m.   Status of policy statement - Anne Hollander
             Update of the product development of pollution
             control organisms - Dr. Thomas Peyton

             Questions from experts:  Clarification of technical
             issues
                                  C-3

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9:35  a.m.   Criteria  to  select  field  testing  sites

             What criteria  have  industry  and acadesnia  used  in  the
             past to select  field  testing  sites  for.non-
             engineered organisms?  What  criteria  will  be used  in
             the future to  select  field testing  sites  for both
             genetically  engineered and non-engineered
             organisms?   If  differences exist, why have  they come
             about?

      OTS" is looking to understand what is considered  in
selecting field testing sites.   Specifically,  are  technical
factors the overwhelming  criteria?  Also,  are  changes  in  the
selection criteria expected  just because  a microorganism  is
genetically engineered?

      The following types of  characteristics are what  we  are
      looking for:

             0 Physical — geographic  characteristics
             0 Technical  --  limited exposure,  single contaminant
             0 Commercial --  cost  effectiveness
             0 Political/Social  -- interactions  with constituency

10:25 a.m.   Coffee

10:40 a.m.   Osing existing  landfills  etc.

             Some experts have suggested  that  existing  disposal
             sites, landfills, etc., be designated for  field
             testing genetically engineered and  non-engineered
             pollution control organisms.  What  would  be  the
             advantages and  disadvantages?

      This is clearly  a topic many people  will have  strong
feelings for.  OTS wants  to  hear a discussion  of the various
viewpoints.  A few of  the disadvantages are that whil'e  the
potential exists to reduce various public  health hazards, there
is some chance that, in the  case of an error or  accident/ the
public health problem  could  be made worse  off.   Political and
social opposition may  also exist due to the fear that  these
health problems could  be  compounded.   Other examples may  be:

             0 Legal concerns — e.g.  liability
             0 Jurisdictional problems —.e.g. State vs.  Federal
             0 Financial
             0 Technical
                                04

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11:35 a.m.   Characteristics of  containment

             What do  industry and  academia consider  to  be
             characteristics of  containment  with  respect  to  the
             field testing engineered  and non-engineered
             pollution control organisms?  Could  greenhouses,
             sewage treatment facilities, lined landfills, and
             land oil wells be considered contained  environments
             or field testing sites?   Why or why  not?

      OTS has a few goals with this question.  Overall, we are
looking for a definition of containment  (release, minimal
release, or that which is technically  feasible).  Is there a
consensus on what is a "contained" environment?.   What "questions
should be considered  in developing a definition of containment
with respect to field testing genetically engineered and  non-
engineered pollution control organisms?

      We are looking for the following type  of characteristics:

             0 Physical — enclosed vs.  not  enclosed (what does
                enclosed mean?)
             0 Technical — a landfill having a plastic liner
             0 Financial -- cost effectiveness
             0 Political — are  the options  socially viable
             0 Differences in treating engineered and non-
               engineered organisms

12:30 p.m.   Lunch

1:30  p.m.   Risk gradient of containment levels

             Is it possible to develop a "risk gradient" of
             containment levels?  What factors must  be
             considered?  Can industry characterize  a "low risk"
             testing site?  Why  or why not?

      It has been argued that field testing genetically
engineered organisms would not present significant concerns of
damage to human health and the environment.  OTS would  like
information on the factors which need  to be considered  in
determining if. there are "low risk" field testing sites.  The
ultimate challenge would be to get the group to characterize a
"low risk" testing site,  and provide a rationale as  to why it
would be considered "low risk".  We would also like  the experts
to rank order their choices.  Factors which may be considered
are:

             0 Physical — are liners better than clay caps?
             0 Financial — cost effectiveness of the
                possibilities
             0 Technical — water releases, worker exposure, and
                the organisms used
                               c-5

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2:25  p.m.  . Monitoring and  emergency  response

             What monitoring  and  emergency  response methods  are
             presently used  for unexpected  spills of  non-
             engineered pollution  control organisms?  what
             monitoring and  emergency  response methods do
             industry and academia plan or  forsee using with  the
             field  testing of genetically engineered  pollution
             control organisms?

      How does  industry and  academia currently monitor their
experiments and/or  commercial applications  of non-engineered
organisms?  What methods are  used  to determine microbial  •
movement?  Regarding existing field tests,  if a person has
concerns about  microorganisms moving beyond  the test  site, what
measures are taken  to prevent migration?  OTS also wants
information on  how, if at all, these techniques would change  in
the case of genetically engineered organisms.  -This will
hopefully aid the staff in understanding what control measures
are currently used  and what may be desirable for work with
genetically engineered organisms.

3:20  p.m.   Break

3:35  p.m.   Incentives to field  test

             What would give  industry  and academia an incentive
             to field test?

             0  Free for all  - brainstorm

      The key here  is to develop  ideas that  could provide
incentives for  research and  commercialization of pollution
control organisms.  While there are numerous reasons  (financial,
technical/ etc) for areas other than pollution control to be  the
focus of research, OTS would  like  to use this time to focus on
those issues (if any) that are unique  to field testing.  For
example, would  Federally designated test sites provide an
incentive to field  test?  Or  is industry leaning more towards
wanting incentives  such as reduced reporting fees, a  tax break or
less expensive  insurance policies?  If no unique issues present
themselves it would still be  useful to discuss some of the
broader issues.

4:05  p.m.   Questions and answers

4:40  p.m.   Objectives for  tommorrow's session

4:45  p.m.   Adjourn until tomorrow
                                c-6

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Friday, March 21

8:30  a.m.   Coffee

9:00  a.m.   Goals for rest of meeting

9:10  a.m.   Benefits

             How can the benefits of genetically engineered
             pollution control organisms be evaluated?   Are  the
             benefits significantly different  from  those
             associated with current pollution control
             technologies?  If yes, in what ways are  they
             different?

      TSCA is an unreasonable risk statute.  To make  this
unreasonable risk determination, OTS must consider  the  benefits
associated with chemical substances, which  includes genetically
engineered and non-engineered organisms.  OTS  now uses  a
relatively simple method of benefits analysis  (comparing price,
physical-chemical properties and use conditions versus  chemicals
already used for the same purpose) for evaluation of  new
chemicals.  OTS wants to learn if there are additional  benefits
from this technology which should be incorporated into  the
Agency's benefits analysis.  Specifically,  some benefits may  be:

               Cost effectiveness
               Technical e.g. increased rate of degradation
               Scientific - research/innovation
               Uniqueness - nothing else will  do the  job
               Toxicity

10:05 a.m.   Coffee

10:20 a.m.   Public Perceptions

             Introduce Dr. Margaret Mellon  from the 'Environmental
             Law Institute

             What are the most effective ways  industry  and the
             Agency can best inform the public of the risks and
             benefits associated with using genetically
             engineered organisms for pollution control?

      One of the key issues in getting genetically engineered
pollution control organisms onto the market will be public
perceptions.  OTS wishes to use this session to develop  ideas on
cooperative methods of informing the public of the risks and
benefits associated with genetically engineered organisms.
The key is to develop methods which present the information  in
the most unbiased manner.  Possible ways the Agency can better
inform the public are:  better use of the press, documentaries,
and allowing public interest groups,. industry  and academia to
more frequently comment on Agency policy via Science Advisory
                                c-7

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Bjroa'd meetings, congressional hearings or Dy ceveloping a'new
form of public meeting.


11:15 a.m.   Establish data and expedite reviews

             How can EPA,  industry, and academia work together co
             establish data on risk ana to expedite reviews?  For
             example, can  incentives be provided to encourage
             industry to notify the EPA of researcn ana
             development progress for genetically engineerea
             products in advance of PMN submissions?  Similarly,
             can industry  suggest categories of products tney
             consider to inherently present a low risk?  What
             other  ideas could be developed?

      ODviously, the easiest way to get genetically engineerea
organisms for pollution control to market in a safe, efficient
manner is for EPA,  industry and academia to work together.  OTS
is looking for information on incentives to get these groups
working together so regulatory issues can be identified early in
the development of  potential projects.  For example, perhaps the
EPA could aid in finding an appropriate testing site, or have
industry forward its data  to the Agency in advance of submission
to lengthen the review period.

      Similarily, TSCA presents the opportunity for exempting or
reducing reporting  requirements for categories of chemical
substances under section 5(h)(4).  However, a finding of "will
not present an unresonable risk" must be made by EPA before this
category can be exempt.  OTS is looking for information on
possible candidate  categories.  The most important information
will be the justifications for why a category would fit the
unreasonable risk standard.  Categories of products may oe:

             attenuated species
             pathogen/non-pathogeh
             mobile/non-mobile
             indigenous/non-indigenous
             plasmid encoded
             enzymes

     OTS is also interested in hearing it products should be, it
at all, differentiated by  the technique used?
                                  C-8

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11:45 a.m.   Innovative  financing  techniques

             What  innovative  financing  techniques  exist  to  aid  in
             the development  of genetically engineered organisms
             for pollution control?   For  example,  what  is venture
             capital's role?  How  can  the 5BIR  (Small Business
             Innovative  Research)  program be  used  more
             effectively?  Are collaborative  research ventures
             within  industry  a viable option?   What  other avenues
             are available?

      For this session,  OTS is interested in  getting  information
on where the financing for genetically  engineered  pollution
control organisms  is coming from and where  it will come  from  in
the future.  OTS is hoping to gain an understanding  of some of
the dynamics of the  industry's financial  segment.

             0 Brainstorm on  innovative financing  techniques.  We
               want  industry  and acaderaia to  exchange information
               among themselves.   Specifically,  Dr.  Barry Katz of
               MYCOsearch has received  a  Phase  I and  II  S8IR  from
               NSF, and  Dr. Middleton of  Koppers has  practical
               experience dealing  with  venture  capital.

12:10 p.m.   Lunch

1:15  p.m.   Introduce Dr. Al Bourquin  from Gulf Breeze
             Laboratory, and

             Dr. Cuskie; Dr.  Peter Chapman; Dr.  P. Hap Pritchard;
             Dr. Tamar Barkay; Dr. Fred Genthner;  Dr. Michael
             Nelson; Dr. Ellen O'Neil;  Dr. Barbara Sharak-Genthner

             These 9 Gulf Breeze scientists are  here  to  present;

             SPA'S RESEARCH ON THE APPLICATION  OF  BIOTECHNOLOGY
             TO WASTE DEGRADATION
2:00  p.m.   Research and Development  (Also  led by Dr. Bourquin)

             What kinds of research and development should the
             EPA and industry undertake which would be the most
             useful for pollution control purposes?.

             EMPHASIZE FOR POLLUTION CONTROL ORGANISMS

      In general, R & D has been discussed to death by
government, industry and academia.  However, this session is
designed to focus on R & D for pollution control purposes only.
The goal of this session is to develop ideas on both basic and
applied research projects which could  enhance the study of
genetically engineered organisms for pollution control.  OTS
would like to come away with a rank ordered  list of projects
which are best suited to be funded by  a government agency.
                               09

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2:45  p.m.   Break

3:00  p.m.   Technical  Barriers

             What are the  key  technics!  barriers  to  developing
             pollution  control organisms?

             0 Free  for all

      OTS  is looking to gather information  on  some of  the  rate
determining steps for the  introduction of genetically  engineered
pollution  control organisms.  While  financial  and regulatory
considerations play  a key  role, OTS  is looking  for a discussion
of the technical factors keeping  this  technology  in  its  infant
stage.  For example, is lack of knowledge of  the  basic biology of
likely-candidates crucial  to the  development  of  the  industry?  Is
the fact that most lagoons, dumps  etc.,  contain multiple
chemicals  of different  natures a  crucial aspect?  What could be'
done to address these issues?

3:45  p.m.   .Questions  and answers

4:20  p.m.   Concluding statements

Meeting Adjourned
                              c-io

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        APPENDIX D
ABBREVIATED BIOGRAPHIES OF
   EXPERT PANEL MEMBERS
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Dr. Douglas Caldwell

      Dr.  Caldwell received  his Ph.D.  in Microbiology  from  Michigan State
University  in  1974.  He was  a research associate  at  the University of Wis-
consin  from 1974  to 1975,  an Assistant  Professor of  Biology at  the Uni-
versity  of New  Mexico  from  1975  to  1982,  and  is presently  an Associate
Professor  in  the  Department  of  Applied Microbiology  at the  University  of
Saskatchewan,  where  he  teaches  undergraduate  and  graduate  courses  in
Microbiology  and Microbial  Ecology.   He  has published  numerous  papers and
reviewed articles  which  concern  the ecology of sulfur bacteria, discovery of
the   genus   Thermothix,   derivation  of  microbial  colonization  kinetics,
computer-enhanced  microscopy, and  the  study of  microbial growth  kinetics
with  the  hydrodynamic boundary  layers of  surface  microenvironments.  . He has
evaluated local  fecal coliform standards as a consultant to the State of New
Mexico, and  participated in  the. development  of  microbiological criteria for
the  disposal  of  nuclear   waste as  a  consultant  to  Los  Alamos  National
Laboratories.

Dr. Ananda Chakrabarty

      Dr. Chakrabarty received his  Ph.D. in Biochemistry from the University
of  Calcutta  in   1965.   He   has  been  a Professor  of  Microbiology  at  the
University  of   Illinois  since   1979.   His  major  research  interests  are
Pseudomonas  infection  in  Cystic  Fibrosis;  plasmids  and  biodegradation  of
synthetic  toxic  chemicals;  and  hydrocarbon  microbiology and  microbial  oil
recovery.   In  1980, Dr. Chakrabarty  received the  first  patent  for  a  living
microorganism  designed  to  degrade petroleum  fractions.   He  received  the
Selected  Industrial Research  Scientist  Award in  1975,  and the  Inventor  of
the Year Award in  1982.  Dr.  Chakrabarty participated in the Asllomar and La
Jolla  Recombinant  DNA  Conferences, is  a consultant  to the  United  Nations
Committee on  the  Application of Genetic Engineering  in Developing Nations,
and is a member  of both  the NIH  Study Section on Microbial Genetics, and the
Advisory Committee of the  International Center for Genetic Engineering and
Biotechnology (Trieste, Italy  and New Delhi,  India).

Dr. Peter J. Chapman

      Dr.   Peter  J.  Chapman,   an  EPA-Distinguished   Visiting  Scientist
(1985-1987),  is  a  Professor of  Microbiology  and Biochemistry with  the
University of  Minnesota,  St.  Paul.   He received his Ph.D.  in 1961  from the
University  of  Leeds.  He  was the  recipient  of a  Fulbright scholarship and
has  authored  or co-authored  over  70  scientific  publications  on microbial
degradation  of  alicylic  and aromatic  compounds.   Dr. Chapman's  research
interests include  the study of  the biochemical  mechanisms  of biodegradation
of   chlorinated   compounds   and   understanding   the   molecular  basis   of
biodegradation   mechanisms.    He  is   currently  investigating  co-metabolic
processes in  work  that  bridges  microbial ecology  and  microbial physiology,
using multi-substrate systems  under controlled conditions.

Thomas Dardas. Esquire

      Mr.  Dardas  is  the  President  and Chief  Executive  Officer of  Detox
Industries,  Inc., a Texas Corporation.  Detox Industries, Inc. is a service
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company  which is  active in  biological degradation  of hazardous  and  toxic
wastes.  At  this  time.  Detox  Industries is the only company in  the U.S. with
regional EPA  approval of its  PCB biodegradation process which can be  applied
in  situ to  any  matrix.  Mr.  Dardas received  his J.D. degree  from  Suffolk
University  Law  School   in  1970,  his  M.S.  degree  from  the University  of
Pittsburgh  in 1971  and  his  B.S.   from  Lowell  Technological  Institute  in
1967.   Mr.  Oardas  is  currently  a  member of  the American  Bar  Association,
Texas  Bar Association  and Massachusetts Bar Association,  and  is licensed to
practice law  in both Texas and Massachusetts.

Dr. Alan Goldhammer

      Dr. Goldhammer is  the  Director  of Regulatory Affairs at  Industrial
Biotechnology  Association.   After  receiving  a.B.A'.  in Chemistry  from the
University of California  at Santa Barbara  and  his Ph.D. in Biochemistry from
Indiana University,  he  was  a Postdoctoral fellow at  Cornell University.  He
worked  at  the National  Institute of Health for five years  before  going to
work for the  Industrial Biotechnology Association.

Dr. Barry Xatz

      Dr. Katz has received his  Ph.D.  and M.S.,  in  Botany  from the  Univer-
sity  of North Carolina  in  1979 and  1973,  respectively.   His predominant
interest is  .focused on  understanding  fungus  habitats and  the  isolation of
persistent vegetative  fungi  from decomposing  plant  matter contaminated with
bacteria  and  the  spores  of  common  fungi.    In  1979,  Dr.   Katz   founded
MYCOsearch where  he collects  rare  and potentially  useful  fungi  from plant
communities worldwide.  He has  traveled to or  received material  from  Brazil,
Costa Rica,   Thailand, India and  the  U.S.   His  research collecting program is
currently plans  to study plant communities in  Western Africa, China, Mexico
and   Chile.    MYCOsearch's   collection,   numbering   approximately   15,000
isolates, is offered  to natural product  screening programs  for commercial
applications  including  hazardous  waste  detoxification.  Recently, MYCOsearch
was  awarded   a Phase II SBIR  grant from  NSF  to screen  for PCB,  DDT and
cellulose degrading  fungi.   MYCOsearch is also  investigating the microbial
flora  of human-altered  and  hazardous  waste  sites.   Dr.  Katz  has  authored
over  15 publications,  and  often presents  symposiums  to  corporations and
academic institutions around the world.

Dr. Ann Kopecky

      Dr. Kopecky received  her  Ph.D.   in  Microbiology/Biochemistry  from the
University of Texas Medical  Branch,  Galveston,  Texas,  where she  also per-
formed  her  Postdoctoral  research in Biochemistry and  Genetic  Engineering.
In  1981  she  became  a  Senior Research  Microbiologist for  Sybron Chemicals,
Inc., Biochemical  Division  in Salem, Virginia.   Sybron  Chemicals  is  a major
manufacturer  of  adapted  bacteria for  treatment  of  industrial and municipal
waste.  Sybron owns  patents on  four  of  their bacterial systems,  and has been
supplying bacterial  cultures  for wastewater treatment  for  over  forty years.
Dr.  Kopecky  is  specifically   involved   with   new  product  development,
production quality management, and application technical services.
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Dr. John Loper

      Dr.  Loper  received his  Ph.D.   in  Biology/Genetics  from  John Hopkins
University  in 1960.   He received his M.S.  degree  in Biology/Cytology from
Emory  University  in  1953,  and his  B.A. in  Biology from Western Maryland
College  in  1952.   Dr. Loper spent most  of his career teaching Microbiology.
Since 1974  he has been a Professor of Microbiology and Molecular Genetics at
the  University of  Cincinnati  College of Medicine.   His research  interests
are  environmental mutagenesis,  isolation and identification  of mutagens in
drinking  water,  and  the use  of  microbial  and molecular genetics  in the
control  of  chemical  mutagens  and carcinogens  in the environment.   The EPA
has  funded  his  current  research  on  gene  engineering  of  yeasts  for the
degradation  of  hazardous waste,  specifically,   cytochromes  P-450  genes  in
yeasts  and  fungi.   Dr.  Loper is  a member  of  numerous  associations and
committees, and he has authored over  35 publications.

Dr. Margaret  Mellon

      Dr.  Mellon  brings both  a scientific  (Ph.D.,   Biology,  University  of
Virginia; M.S.  and B.S.,  Biology,  Purdue) and  a  legal  (J.D., University of
Virginia Law  School)  background into her current role as Program Director of
the  Environmental  Law  Institute.   Her  present  efforts  are  directed  at
research  and  public  education  in  toxic  substances control  and related
areas.   She  previously  conducted  research  in Molecular Virology.   She has
been  admitted to  the Bar  of   the District  of Columbia  and  the Bar  of the
Court of International Trade.

Dr. Andrew Middleton

      Dr.  Middleton  received   his  Ph.D.   in  Environmental  Engineering from
Cornell University in 1974.   He received his M.S. in Sanitary Engineering in
1971  and his  B.S.   in Civil Engineering in  1970  from  Virginia Polytechnic
Institute.  He  worked as  a  Civil  Engineer from  1974  -  1978.   Since 1978 he
has  held  various  positions   with   Koppers  Company,  specifically,  Senior
Research Engineer in  the  Research  Department,  Manager of  the Water Quality
Engineering  Section  of   the  Environmental Resources  &  Occupational  Health
Department,  and  Vice  President  &  General   Manager  of  the  Environmental
Resources Section.   Since 1984 he has been Vice President & General Manager
of  the   Pioneering Technologies  and  Environmental  Resources  Section.   His
overall  responsibility  is  to  manage  Koppers  Environmental Affairs Section.
Included in Koppers  Operations are over  50  chemical  & allied product plants
including 17  wood preserving plants,  as well as other  facilities  producing
metal products  and   road  materials.   Dr. Middleton  has  authored over  20
publications.

Dr. Gilbert Omenn

      Dr.  Omenn  received  his  Ph.D.  in Genetics  from  the  university  of
Washington  in  1972,  his  M.D.  from Harvard  in  1965  and  his  A.B.  from
Princeton in  1961.   His  internship  and residency in  Internal  Medicine were
at the Massachusetts General Hospital in Boston.  .He  was research  fellow at
the Woods Hole Oceanographic Institution,  the Brookhaven National
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Laboratory,  the  Veizmann Institute  of Science  in Israel,  and  the National
Institutes of Health  in Bethesda, Maryland.  He  was  a White House Fellow at
the  Atomic  Energy  Commission  in  1973-1974.   Dr.  Omenn  also  served  as  a
Deputy to Frank Press,  President  carter's Science and Technology Adviser and
Director of White House Office  of Science and Technology Policy, and then as
Associate  Director  for Human  Resources  in the Office  of  Management  and
Budget.  Dr. Omenn,  in 1982, became Professor of Medicine and Environmental
Health and Dean of  the School of  Public Health and Community Medicine at the
University of Washington, Seattle.   His research and public policy interests
lie  in areas  of genetic  predisposition  to environmental  and  occupational
health hazards, chemoprevention of cancers,  the  improvement of science-based
risk analysis,  and applications of genetic engineering.

Dr. Thomas Peyton

      Dr.  Peyton  formed AmTech  Consultants  in 1981  in Vienna, Virginia as a
private  consulting   practice   in  the   fields   of   biotechnology  and  the
environment.  Through  AmTech he  provides  research and consultative services
to government and industry  in areas  ranging from techno-economic analyses of
new;  product  developments to field operations and services in environmental
control.   Dr.   Peyton  received  his  Ph.D.  in  Bionucleonics  from  Purdue
University's School of Pharmacy  and  Pharmacal  Sciences  in  1974  and majored
in  Molecular  Biology  during   his  undergraduate studies  at  Purdue.   His
experience  includes  the areas  of  environmental  and  radiological  health,
environmental biotechnology  research and  applications,  and risk assessment!
He  is  the  author  of  over 60   publications   and   reports,  including  the
biotechnology  section   of   the  1983   US  Congress,   Office  of  Technology
Assessment  report on   "Technologies  and Management Strategies for Hazardous
Waste  Control,"  and  the 1985  book  "Hazardous   Waste  Treatment:  Impact  of
Biotechnology."   Dr.   Peyton   has  published  several  review  articles  in
biotechnology  journals  on  biotechnology   and   environmental   protection,
including economic,  technical,  and regulatory aspects.

Dr. George Pierce

      Dr.  Pierce  received his Ph.D.  in Microbiology  in 1976 and his B.S. in
Biology in  1969  from Rensselaer  Polytechnic Institute.  As  a  Postdoctoral
Associate  at Rensselaer,  Dr.  Pierce  applied  his  knowledge of  petroleum
biodegradation to the degradation of pesticides  and  related toxic compounds
in aqueous environments.  Since 1977 he has worked as the Task Leader of the
Microbial Genetic Engineering  Program at  Battelle  Laboratory  in Columbus,
Ohio.  His  work  began  with  the isolation and characterization  of a plasmid
to degrade  halo-organic  compounds.   Genetic manipulative  technologies  are
also  being  used  to  stabilize  and  optimize   2,4-D  degradative  ability.
Battelle  labs  also  is  working  to  develop improved  microbial   strains  to
degrade chlorinated hydrocarbons.  Additionally, his  experience  ranges from
developing and/or researching:  alcohol  fermentation;  cellular-immobilization
and  entrapment;  the  use of  microorganisms to degrade  petroleum  and DDT and
its  analogs;  and developing cloning vectors and host systems  suitable for
work with genes from environmental strains of Pseudomonas.

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Dr. Gary Savler

      Gary  S.  Sayler,  received  a B.S.  in Bacteriology  from  North Dakota
State  University,  and   a  Ph.D.,  1974,   in  Microbial  Ecology  from  the
Department  of Bacteriology and  Biochemistry  at  the  University  of Idaho,
which  was  followed by  Postdoctoral research  in Marine Microbiology at the
University  of  Maryland.   He  has  been  conducting research   on  bacterial
biodegradatlon of  PBC and related contaminants  since  1976 at the University
of  Tennessee,  Knoxville.   There  he  is presently  Professor  of Microbiology
and  Ecology  with  additional  faculty  appointments  in  the   Environmental
Toxicology and Biotechnology Graduate  Programs.   With  EPA funding and an NIH
Research Career  Development Award his  work led  to  the  discovery of a novel
PCB degrading  plasmid.   His laboratory  is  active in investigating microbial
community  response to  contaminant stress,  and   the evaluation and  role of
catabolic plasmids  in accommodating environmental contamination,  currently,
his laboratory is  developing  and using molecular  approaches,   such  as  gene
probe  technology and  DMA reassociation kinetics,  to study  the maintenance
and impact  of  genetically  engineered  microcosms in the  environment.  He is
an  editorial  board  member for   Appl.  Environ.  Microbial.,  J.  Microbial.
Methods, and Indust.  Microbial. and serves  on  the  Applied and  Environmental
Microbiology Subcommittee of  the ASM  Public  and  Scientific Affairs Board.
He  has authored  over 50  papers,  and  has directed approximately  2 million
dollars in corporate and Federally-sponsored research.
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        APPENDIX E
LIST OP WORKSHOP OBSERVERS
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           WORKSHOP OBSERVERS


 JODI BAKST,  EPA - WORKSHOP COORDINATOR

 STAN ABRAMSON,  OGC

 DR. JANET ANDERSON, OPP

 DR. ANGELA AULETTA, OTS

 DR. TAMAR BARKAY, ERL - Gulf Breeze

 DAVID BASSART,  OSW

 JUDY BELLIN, OSW

 JAMES BERLOW, OSW

 DR. AL W. BOURQUIN, ERL - Gulf Breeze

"JOHN BURCKLE, ERL - Cincinnati

 DR. CAMELE,  OPPE

 JOSEPH P. CHU,  Ph.D., P.E.
 Assistant Director, Plant Environment
 Environmental Activities Staff
 General Motors Corporation
 General Motors Technical Center
 30400 Mound Road
 Warren, Michigan  48090-9015

 DR. NANCY CHIU, EPA

 DR. CORNETT, Tyndall Air Force Base

 DR. STEPHEN CUSKEY, ERL - Gulf Breeze

 KATE DEVINE, OTS

 RON EVANS, OTS

 JURGEN H. EXNER,  Ph.D.
 International Technologies
 Technical Director
 Regional Office
 1815 Arnold  Drive
 Martinez, California  94553

 DR. ERNEST FALKE, OTS

 CAROL FARRIS, OTS

 DR. FLANAGAN, NSF, Ecology Program


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    WORKSHOP OBSERVERS  (Continued)






BOB FREDERICK, OTS




ELAINE FRIEBELLE, Versar, Inc.




DR. FRED GENTHNER, ERL  - Gulf Breeze




DR. BARBARA SHARAK-GENTHNER, ERL - Gulf Breeze




VAL GIDDINGS, OTA




STEVEN HASSUR, OTS




ANNE HOLLANDER, OTS




FRANCINE JACOFF, OStf




DR. DAPHNE KAMELY, ORD




JAN KURTZ, Dynaraac




MORRIS LEVIN, ORD




ELLIOT LOMNITZ, OSW




LARRY LONGANECKER, OTS




STEVE LYONS, Biogen




GREG MACEK, OTS




DOUGLAS McCORMICK, Bio/Technology Magazine




JOB MONTGOMERY, ORD




DR. MICHAEL NELSON, ERL - Gulf Breeze




ROBERT NICHOLAS, Blum, Nash,  and Railsbach




DR. ELLEN O'NBIL, ERL - Gulf Breeze




DR. HAP PRITCHARD, ERL - Gulf Breeze




JULIA SCHWARTZ, Versar, inc.




DR. MARK SEGAL, OTS




DR. P. R. SFERRA, ERL - Cincinnati




MICHAEL SHAPIRO, OTS
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    WORKSHOP OBSERVERS (Continued)






JOHN STERLING, Genetic Engineering News




ART STERN, OTS




GREG THIES, OPPB




AL VENOSA, ERL - Cincinnati




LAJUANA VILCHER, OA




THOMAS WILSON, Department of State
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