Marvin Moss: Pat, your question to us was why should your readers know ó and want to know ó about marine biotechnology. North Carolina has lost tens of thousands of the jobs in textiles and tobacco and furniture manufacturing that the state used to have. Governor Jim Hunt, with a couple of other people, about 22 years ago, saw the need for advanced technology to bring jobs to North Carolina in an innovative way. And so the North Carolina Biotechnology Center was set up, and it is funded by the state. It has helped tremendous numbers of companies get started ó researchers in universities, students and community colleges ó with biomanufacturing. Today there are over 48,000 jobs in North Carolina in biotechnology and over 360 biotechnology companies. North Carolina, worldwide, is considered No. 3 in biotechnology after California and Massachusetts. So if you are really interested in the future of this state and the future of the country, from the point of view of food, from the point of view of health and pharmaceuticals, from the point of view of fuels, biomass for biofuels, from the point of view of an economy, then youíve got to be interested in biotechnology, and in particular, in this area of North Carolina, in marine biotechnology.
Brent Lane: North Carolina is facing the challenge of reinventing its economy in ways that use its competitive advantages for the future the same way it used its competitive advantages in the past. The industries that drove the state economy for over a century ó textiles, tobacco, agriculture and furniture ó were based on competitive advantages that were identified by entrepreneurs and invested in by capitalists a century ago; industries that at that time were cutting edge and high tech and that sustained North Carolina for a very long time. We think of them as old declining industries, but they were very successful for decades. North Carolina has got the challenge now of identifying and cultivating industrial and business and commercial activities similarly drawn on new competitive advantages, particularly in areas of research expertise and excellence in innovation. We think of the Research Triangle area as being a leader in identifying technology, applying research or commercial application in things like biotechnology, pharmaceuticals, electronics and telecommunications, but thatís not the only place in North Carolina where we can be innovators and entrepreneurs, that we have research expertise, particularly here in the coast in the marine sciences. The challenge we face is how do we take advantage of our knowledge resources at universities and in industry to create an economy that has the advantages and can sustain the state for the next 100 years? And marine science certainly represents one of those opportunities that are particularly wedded to rural eastern North Carolina.
Wade Watanabe: The driving force behind our interest in mariculture is the growing worldwide demand for seafood. The harvest of fish from our oceans is static, or declining, so I think itís pretty logical to assume that in the future, we are all going to have to eat less seafood, or that additional demand has to be met by aquaculture. It might surprise you to know that aquaculture is the fastest growing form of agriculture in the U.S. Americans consume about 16 to 17 pounds of seafood per year. Thatís the per capita consumption. That equates to about one seafood meal per week, and if you calculate the population projections through the next 18 years to 2025, assuming that per capita consumption is going to remain stable, about one seafood meal per person per week, then by 2025, weíre going to need an additional 2 billion pounds of seafood. So that begs the question, well, where is all this seafood going to come from? We are already importing 70 percent of the seafood that we consume here in the United States, and 40 percent of that is aquaculture. So I think there is an opportunity for domestic aquaculture to help supply that demand, and I think many scientists feel that we need to become more self-reliant in producing our own food, making sure our food is safe to eat and secure. These are great economic opportunities. We have an $8 billion a year seafood trade deficit. It would be nice to reduce that.
Thomas Long: At Maricultura, we were growing seaweed on land; protein seaweeds that have a 20- to 40-percent protein content. And we found that there were some very high-valued uses for these, such as in egg white nutritional supplements, but then about 1986, my board of directors said they didnít want us to be farmers, that they would prefer for us to look at omega-3 fatty acids. I had discovered that omega-3 fatty acids, which are the basis for fish oils, do not come from the fish themselves; they donít produce them. Itís what they eat, so itís part of the production chain. So in 1987, I filed for a patent on the production of the omega-3 fatty acids from a particular group of microorganisms which we thought were very important. The way that this relates to what Wade has just been talking about is that yes, it would be nice to be able to aquaculture many different species and be able to get the benefits of seafood from all of the species, but in order to do that, youíre going to have to feed the aquaculture species something that has the omega-3 fatty acids in it. It has to be a fish meal, not a soybean meal because ó and this is for you too, Sarah ó because if it is a soybean meal, then it contains the omega-6 fatty acids, which are the things that are really bad for you in large quantities. So we developed technology for the production of omega-3 fatty acids in fermenters ó just like you make beer ó and itís completely noninvasive marine biology, and we were only about 20 years ahead of our time, because now the market is really taking off.
Brent Lane: If we want to cultivate innovative research-based companies ó we may have the research and we may even have the entrepreneurs ó the capital market, particularly for the early stage, needs to be one that is in most ways indigenous, locally based, and thatís an area that is still a challenge here in North Carolina and really in all the southeastern U.S. The availability of capital is one of those things that are an impediment to realizing the full potential for a lot of our innovative business opportunities, particularly in marine science.
Sarah Yocum: Absolutely, people want to see the data, but you need money to gather the data, to generate the data, but to get to the venture capital level, they want to see definitive points, and thatís one of the issues that my company has run up against, so you have to seek it out from government or state-funded agencies, which makes it take a little bit longer to generate data. But if you get the capital investment groups involved, milestones are reached faster.
Bob Roer: What my office does in graduate education for not only the marine sciences, but for biotechnology across the board, is to try to promote research by helping faculty get grants, by providing some technology transfer, assisting the capabilities of the university to help take some of these products, particularly in the early stages, and help to facilitate the acquisition of the kind of funding thatís important to get these companies started. Universities are beginning to turn toward a variety of public and private partnerships, and this is an important way in which the universities help promote marine biotechnology. We have been given some seed money from the state on a recurring basis to help promote marine biotechnology in this area, and we are really at a point now where we are ready to move forward and begin to attract companies to this area based upon the investment that the state has made in us. We got approval, today, in fact, through the budget finance committee of the [UNC] Board of Governors, to proceed with the colonial campus designation [for UNCW] that will allow us to build buildings and engage in public-private partnerships in nonconventional ways that are going to help promote, among other things, marine biotechnology.
Sarah Yocum: I want to focus on North Carolinaís effort to maximize its resources, and I think thatís what marine biotechnology does. We have all these resources around us, not just the oceans, but all the universities, all the potential "flowerations" across the field.
Michael DeTure: Iím part of the marine biotechnology North Carolina State [University] funding that has been put in the line item from 2004; it pays to develop marine biotechnology in eastern North Carolina, and weíre here to look at the marine sciences that are going on, and then try to either spin out businesses or support business that are already here in trying to develop the resources, the human resources, so that when people do have good ideas and the funding is there, that there are people locally who can do the work. Iím a medical scientist, but I can see the opportunity they talk about just in our little building, the Center for Marine Sciences; we have cultures that can be grown on a continual basis of 300 different algae, and all of those can be explored to look for new drugs and other useful items.
David Green: Marine biotechnology is important to North Carolina because our coastal system represents the second largest estuary in the U.S., second only to the Chesapeake Bay. The Croatan, Albemarle, Pamlico Sound area of central and northeastern North Carolina is the second largest in the U.S. The Cape Fear River system, all our coastal areas are extremely important for productivity of our natural marine fish and shellfish products. So Iím aware of many things that the university is involved in, in terms of extracting and applying products from the ocean that have commercial and human benefits from enzyme technology that might be antibiotic for medical applications or the drug therapy thatís done here at UNC Wilmington. The worldís oceans represent 71 percent of the total surface of the earth. So probably the most important thing for readers to understand is the oceans represent a wealth of diversity of raw materials, and fish. The second thing is that weíre trying desperately to add value to North Carolina products. We have the natural raw material, but we need to make more out of the raw materials that return higher value to the businesses and fishermen that provide them.
Randall Johnson: We have strong natural assets, obviously, but we have strong institutional assets, as well. The state has put a lot of money into developing the infrastructure in Carteret County, in Wilmington and in different places in the state. So what the biotech center is seeking to do is support that effort, connect the dots in education, research and business creation, to improve peopleís lives in North Carolina.
Michael McKenna: Fifty percent of the drugs we use today in the clinic are all-natural products, and probably the most biodiverse environment where you can find new drugs is the ocean. There are a lot of examples of anti-inflammatory agents, anti-cancer agents and other drugs that are currently in development that have been derived from marine organisms. There are also a lot of research tools that all medical scientists use in physiology and pharmacology and everywhere else, that are derived from marine organisms, as well. Itís going to be extraordinarily important if you are going to grow businesses here, they are going to have to be, to get the financing, they are going to have to be very much product focused and easy to understand. The biggest problem in pharmaceuticals is getting the technology across to the public. Itís got to be something that you immediately recognize as satisfying an unmet medical need.
Matt Parker: The one thing about the production end and mariculture is, when was the last time you saw a fish or a shellfish that was harvested or grown in North Carolina go bad and not get sold? Everything that we grow or harvest gets sold. Granted, itís not always for the best price, because of marketing conditions, but everything is going to get sold. So what we try to do is help the folks that are in the aquaculture business grow fish or shellfish at an economically successful rate so they are actually able to get a return and make money at what they are doing.
Kel Landis: We have the finest universities in the world right here, and if we can marry, kind of reinvent, our economy with the university resources that we have, with the natural environment that we have, then we can create a bright future for our state economically.
Pat Bradford: Would it be true to say the state can reinvent itself with this industry?
David Green: Marine biotechnology is an untapped resource in North Carolina. We have all individually worked in certain areas because of interests or expertise, but as a business, as a community, itís untapped. Itís ripe for development.
Bob Roer: The potential is almost infinite. We have looked at so few of the organisms and so few of the processes and so few of the molecules that are uniquely contained in some of these marine organisms, itís almost impossible not to discover something new.
Michael McKenna: Reducing it to product might be a challenge.
Bob Roer: Exactly, one in a thousand is something of interest, and one in a thousand of those is something that is commercial. But there are hundreds and hundreds and millions of these just to be discovered.
Randall Johnson: Two of the sectors that we are looking at in this state, one is biofuels ó the potential for algae development and biofuels ó and the other is nutraceuticals.
Marvin Moss: And environmental concerns for heavy metals and things like that with enzymes, itís a huge field. NOAA (National Oceanic & Atmospheric Administration) is sponsoring quite a bit of research. NIH (National Institutes of Health) agency has even funded some. They funded some at the Scripps Institute of Oceanography. Scripps is one of the oldest oceanographic institutions in the country, one of the oldest in the world, and, in direct regard to this conversation, they made the comment that open ocean fishing would probably not be allowed anymore in our lifetimes. I havenít seen that particular comment before, but in appreciation of the black sea bass weíve eaten here tonight. [provided by UNCW Center for Marine Sciences aquaculture program.]
Wade Watanabe: These fish were spawned from adults captured in North Carolina waters. They were photothermally conditioned in tanks and spawned by our staff and our students. One student spawned the fish, another reared the eggs and larvae through the juvenile stages and a couple of others raised the fish from the juvenile stages to the market size that you are seeing tonight in a land-based research tank system built by another student.
Thomas Long: How much does it cost per pound?
Wade Watanabe: We have done detailed economic analysis on ongoing wild caught fish brought in weighing approximately a half pound and then growing them up to market size, and we know that those fish can be produced at a break-even price of about $4 a pound. We havenít done the detailed economic analysis on the complete grow cycle from egg to market size, but thatís the next step in our economic analysis.
Matt Parker: We have had some direct application of the research that Wade has done recently in the last year. We have had a real estate developer from this area start construction on a facility to grow flounder and black sea bass here, out by the Wilmington airport. He has built one facility here and one in Florida. He has invested heavily in the mariculture effort and wants to get in on the ground floor of producing aquaculture seafood products. He is going to get his juvenile flounder from another fellow in North Carolina who took the manual that Dr. Watanabe and Dr. Daniels wrote on how to produce baby flounder and started a flounder hatchery, so weíre starting to see the production of marine food products come about in North Carolina.
Wade Watanabe: The high area interest of marine fish farming now is fishing offshore cages, big cages well off the coast that require a mooring system in relatively deep water, say 120 feet to 140 feet deep. And it also has to allow the cage to be submerged away from the surface when a hurricane passes through. Here in North Carolina, we have that shallow continental shelf that goes out, donít quote me on this, but 30, 40 miles offshore. So it would be relatively difficult to deploy cages in the coastal waters of North Carolina. So marine fin fish farmers believe that to expand in our state, weíre going to have to rely on closed recirculating tank systems inland. These are systems that recycle and reuse water over and over again by removing waste from the water, supplying oxygen to the fish. They grow fish under high densities, so they are compact, they donít need a lot of land area, they are conservative of real estate, if you will, and they are generally situated indoors in basically an agricultural shelter, so these fish farms of the future will basically use agricultural shelters like you see on hog farms or tobacco farms right now. If they are grown indoors like that, you have better control of the environment, so you can have optimum year-round conditions despite changes in seasonal conditions. And because they are recycling and reusing water, you donít necessarily have to be right next to the ocean; you can be situated in more inland areas where land is less expensive, and of course you are going to have to use recycled sea water, artificial sea water or possibly even haul in sea water from the coast. I think that kind of gives you a glimpse of the fish farms of the future here in North Carolina.
David Green:: I was looking at the statistics from the State Marine Fisheries Division on land values in North Carolina versus the statistics on aquaculture production for the state, and North Carolina has finally achieved equality. The production value for aquaculture fish in North Carolina is equal to the wild fish harvest. We are shifting our production to aquaculture.
Kel Landis: People know about biotechnology when it is used in its broadest sense; they think of gene therapies and the Research Triangle Park. They know North Carolina for high tech, but putting the adjective "marine" biotechnology in front of it, I donít think people really know what the potential is, and we have to raise that flag and wave it and put some flashing lights around it to get people to know what the potential is.
Randall Johnson: Itís important to demystify that message, to let the people know itís about marine biotech and biofuels and a whole range of applications that relate directly to rural North Carolina.
David Green: If you take the word apart, look at the individual pieces, marine relates to the ocean, bio is all the organisms in the ocean, whether it be fish, microorganisms, algae, so if you look at the organisms from the sea, and then add the word technology, which means application, which means commercialization, then itís not science, itís the application of marine organisms from the sea to benefit coastal North Carolina. It involves every business that you can think of on the coast.
Thomas Long: One of the real success stories that I have always thought of ó and David was involved in this ó is the story of the scallop medallions out of N.C. State.
David Green: There was a North Carolina company that was struggling financially. They harvested products from Alaska, they had harvested products from Argentina, they fished all over the world and they had a million pounds of sea scallops in their freezer, which they couldnít sell because they were undersized, about 80 to 120 per pound. And the Argentina sea scallop, we did some sensory work at the marine lab; the flavor profile is excellent, wonderful, fruity, flavorful. But though the sensory qualities were excellent, the size was too small, and the fact that they came from Argentina, the price was higher than what you would pay for small sea scallops from China, so they couldnít sell them. They said, ĎWell, what can we do with them?í Someone suggested grinding them up and making something else out of them, and they called us and we said, ĎPlease donít do that.í The market wanted 30 per pound, and they had 80 or 100 per pound, so we said, ĎWell, just glue them together.í How do you do that? You just use natural products from the sea. We told them to take plasma protein and take out the red blood cells, so that they have the plasma, the two components that cause clotting in blood, and then take those sea scallops and dip them in that clotting agent and put them in a small casing in whatever diameter they wanted. The company bought a used pizza slicing machine and they cut them 30 per pound and they made $2 per pound profit, in 90 days. They made $2 million, and they built a 75,000-square-foot facility in Suffolk, VA. It revolutionized the industry because they were not allowed to harvest the sea scallops from the wild fishery at that time. There was a market, and they took advantage of technology, and they saved the family business.
Thomas Long: And the family business is out of Wanchese, so the profits come back to North Carolina.
David Green: They endowed an undergraduate scholarship at N.C. State based upon that application, so weíre investing back in this state.
Kel Landis: Attention and excitement and success lead to momentum and money, but if you talk to 10 people on the street, nine arenít going to know much about what weíre discussing. We need to do a better job of letting the general public know about the potential here. Maybe we can get Michael Jordan to say something about it.