Red alert on science funding

For the first time, the MacDiarmid Young Scientists of the Year Awards this year recognised research with the most potential for commercialisation. But does government funding match the rhetoric?

Friday, September 04 2009 || Innovation || BY Fiona Rotherham




In that modest, self-contained manner some British have, molecular biologist Richard Epsley was rather pleased to have won both an award in the Adding Value to Nature category and the first Commercialisation Award at this year’s MacDiarmid Young Scientists of the Year event.

It’s a bit dubious whether the 48-year-old, British-born Aucklander can still be described as young, but there is no question about the quality of his research into the genetic mechanisms which control the red colour of apples.

A former journalist, who recently completed his PhD at the University of Auckland, Epsley has always had a thing about colour and originally worked on developing pink bananas in Britain. He turned to red apples after coming to New Zealand six years ago to work at Crown Research Institute Plant & Food.

The mechanism he discovered involves a natural alteration in the DNA of the gene that controls colour in appleflesh, MYB10. This gene is a transcription factor, one of a class of genes that produce proteins which bind to other genes and switch them on or off. In the case of MYB10, it switches on genes in the anthocyanin production
pathway, producing the red colour of apple.

That’s all very nice, but why do we care? Dr Epsley says understanding how anthocyanin is regulated at the genetic level is important in knowing how to breed red apples that are more attractive to the consumer and contain high levels of healthy antioxidants.

Fruit containing what is known as the ‘‘health halo’’ is increasingly popular with consumers, and while Epsley says New Zealand is ‘‘ahead of the game’’ in producing a healthy and tasty red-fleshed apple, others are also competing hard to be first to market.

Red-fleshed apples have been around for years in Central Asia and, in particular, Kazakhstan. But red apples from Borat country taste awful and need to be crossed with flavoursome white-fleshed apples to produce a commercially viable, redfleshed cultivar.

The trouble is developing a new type of apple is a long, slow process when you’re not using genetic modification. For example, Jazz, one of our stellar new apple varieties, took 20 years to get to market.
‘‘Being able to screen for the red-flesh gene in seedlings will allow breeders to isolate and focus on new varieties of apple with red-flesh characteristics at an early stage, speeding up the breeding process,’’ Epsley says.

His research has been funded through Prevar, the joint venture partnership between Plant & Food, the New Zealand and Australian pipfruit industries and the Associated International Group of Nurseries. He is quietly confident they could have a new red-fleshed apple to market within the next five years, considerably more quickly than normal commercialisation. And it doesn’t stop with apples. The same gene sequence can be used to reduce the breeding time for other red-coloured fruit or vegetables – Epsley’s working on kiwifruit and pears
at the moment.

Stuart McKenzie, a venture capitalist and director of Endeavour Capital, was a judge for the commercialisation award and says the red-fleshed apple stood out from the other entries because it has the mechanism to be commercialised at scale and fairly fast.

He is personally disappointed, however, that the best we can deliver innovation-wise has again come from the agricultural sector. While it makes sense to play to our strengths, McKenzie says that won’t deliver New Zealand a first-world economy within the next 10 to 15 years.

‘‘The two legs of our economic stool are agriculture and tourism, but surely we need a third leg. We need to get an industrial base.’’ New Zealand’s dilemma is lack of funding. If you look at venture capital worldwide, the really successful ideas fall out of germinating a lot of seeds and hoping at least one will grow tall.
It’s almost impossible to predict which seed will do so, so the more you have, the better your odds of striking the jackpot.

Our Government gives lip service to the importance of science commercialisation, but McKenzie claims funding for science research and development of about $750 million a year doesn’t allow for a lot of new seeds. Australia thinks it is not doing enough, and it spends several billion dollars annually on government-funded research and development.

We do plenty of research, but we lack funding for the development side and most of our companies are too small to commercialise products on their own, especially since National canned research and development tax credits.

McKenzie points to Kiwi startup Glyvale, which produces a device for detecting diabetes. It has had about $2m in funding to take the device to market, while its offshore rival, Veralight, has had about US$47m (NZ$68.4m) to date.
The holy trinity in venture capital is the IP, the entrepreneur and the capital, he says.

‘‘We have plenty of entrepreneurs and IP, but the gap is the capital. That gap is the best one to be missing, though. It is solvable should we choose to solve it. If we can find $50m for cycleways, surely we can find $50m for high-quality development.’’

Bring on compulsory super, I say.