Viewpoint -- Make Way For The 'Third Wave'

Industrial biotechnology will be "disruptive" and widespread.

Is biotechnology manufacturing? On the one hand, biotechnology companies do make products in factories -- once they advance beyond the research stage -- and are players in the health-care and agricultural markets. On the other hand, the processes used to make biotech products have tended to be so different from traditional manufacturing processes that it was hard to discuss them in the context of traditional manufacturing concepts and concerns. But in the future biotechnology likely will play a much bigger part on both the producer and consumer sides in traditional manufacturing because of what is known as the "third wave" of biotechnology -- industrial biotechnology. That topic is being discussed this week in Washington, D.C., at BIO 2003, the annual conference of the Biotechnology Industry Organization (BIO). Industrial biotechnology has varied implications in many manufacturing sectors. There are pioneering companies making bio-based products such as Cargill Dow LLC, which is manufacturing a corn-based material that's an environmentally friendly alternative to petroleum-based materials that wind up in packaging, clothing, etc. Other companies are developing enzymes that cause reactions in production processes, potentially shortening production time and reducing waste. Then there are the manufacturers that are applying such processes and products to existing products. German pharmaceutical company Roche, for instance, has developed a bio-based method to produce vitamin B (riboflavin) that results in about one-quarter of the wastewater generated from chemical-based vitamin B production and results in exclusively biomass solid waste that can be safely returned to the soil after composting. Bio-based production costs tend to be comparable or less. "[Industrial biotechnology] has big implications for the chemical industry and the energy industry over the short term," says Brett Erickson, vice president of the industrial and environmental section of BIO. "Over the long term, it will be disruptive, and it will be adopted by all areas of manufacturing as new enzyme biocatalysts become available to perform new functions." The Organization for Economic Co-operation and Development (OECD) has been studying industrial biotechnology for several years and in 2001 issued a 148-page report on the topic based on 21 case studies. "The next few years will see a number of major plants producing industrial materials and chemicals from renewable resources, as well as the incremental incorporation of bioprocesses into a wider range of industrial manufacturing," the report concludes. The report, the OECD says, is aimed at corporate executives in an attempt to educate them about the benefits of the movement. Certainly, lack of awareness is one thing holding back industrial biotechnology. Investment, too, is a hurdle because these production processes tend to be capital intensive, Erickson says. However, as larger, entrenched manufacturing companies become more aware of opportunities in biotechnology, things should start rolling and trickling through all of manufacturing. That always seems to be the way with new concepts that end up being boons for U.S. manufacturers (think Toyota Production System). Although industrial biotechnology still is in the early stage, its emergence as the "third wave" (after medicine and food) in biotechnology can only benefit manufacturers as the pressure to reduce production costs continues and the triple-bottom line becomes more prevalent. Tonya Vinas is Managing Editor for IndustryWeek. She is based in Cleveland.

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