A ruling by the EU's top court on a genetic engineering technique has left German scientists and agricultural businesses worried that they will fall behind US and Chinese rivals.

A legal maize.

More regulation, more hurdles to research. So say many German scientists, following the European Court of Justice's ruling that the fruits of gene-editing techniques such as CRISPR, used for plant breeding, must still be considered genetically modified organisms (GMOs). This means that their products, both commercial and research-based, must be labeled as GMOs. These are strictly regulated in the EU, with several countries, including Germany and France, having total or partial bans.

German researchers were left incensed. "The judgment has surprised us with its absoluteness and is professionally incomprehensible," Carl-Stephan Schäfer, director of Germany’s plant breeders association, told Handelsblatt. "Europe will continue to fall behind as a research and business location for plant breeding in the world."

CRISPR allows strands of DNA in the genome of a living organism to be precisely modified or replaced, with a view to improving the organism or to carry out research. No foreign DNA is incorporated into the organism, nor are genes transferred, unlike in traditional genetically modified organisms (GMOs), which rely on artificially created mutations.

Not natural

Scientists tout the process as cost-effective, efficient and safe. Via such techniques, the hope is that plants can be protected from diseases or made to better cope against harsh weather, including droughts and the effects of global warming. CRISPR could even accelerate research into cancer, blindness and blood disorders with its ability to mimic the gene mutations of cells. Many researchers claim its products are not GMOs.

But the ECJ disagreed. CRISPR “alter(s) the genetic material of an organism in a way that does not occur naturally,” and so it should be regulated and labeled as GMOs are, the judges said.

Environmental groups and consumer associations are celebrating a cautious approach towards new technology, but European biotech researchers are aghast. The ECJ’s ruling is “the death blow for plant biotech in Europe,” Sarah Schmidt, of the Heinrich Heine University of Düsseldorf, told Science magazine. Gene-edited plants will now have to be assessed in a lengthy approval process that typically costs about $35 million, she says. Only the big players will be able to take part, putting universities, non-profits and smaller companies at a serious disadvantage.

26 p15 Genetic engineering on the rise-01

Many companies and industry associations warn that Europe will become a no-go area for innovative genetic engineering techniques such as CRISPR. German agrochemical giants such as Bayer and BASF long ago relocated their research departments to the United States. US officials say they have no plans to make gene-edited crops susceptible to the same stringent regulations as transgenic crops.

Bayer has promised CRISPR Therapeutics, a Swiss-based market leader, a minimum of $300 million over the next five years to further develop the technology and is being granted exclusive rights to all CRISPR developments in the agricultural sector. Meanwhile, the Darmstadt-based Merck Group is betting on CRISPR to grow its life science business.

But German mid-size firms, which lack the deep pockets of the likes of Bayer, are likely to be hit hard by the ECJ ruling, as are farmers who may not be able to access potentially game-changing new seeds. "The current drought is an example that in the future we need dryness-tolerant varieties," said Joachim Rukwied, the German Farmers' Association president.

Following the EU ruling, Ricardo Gent, managing director of Germany’s industrial association for biotechnology, said he expects profiteers to move to China. The state is massively expanding its knowledge in agricultural technology, for example through the acquisition of the Swiss company Syngenta. In addition, the government has set itself the clear goal of modernizing agriculture – also using new genetic engineering methods.

Bert Fröndhoff heads up coverage of chemicals, healthcare and services for Handelsblatt. Siegfried Hofmann is Handelsblatt’s chemical and pharmaceutical industries correspondent. To contact the authors: [email protected], [email protected]