By Bob Drummond   Jan. 9 (Bloomberg)
      

     Groundbreaking in its own right, the genome transplant was
a practice run for Venter's more audacious project: creating a
new life form -- in this case, a species of built-to-order
bacteria --using only man-made DNA.
     Designer organisms, and the potential to profit from them,
are sparking excitement -- and debate -- among scientists and
venture capital investors. Researchers in an emerging field
called synthetic biology envision microbes customized with
artificial genes to enable them to turn sunlight into fuel,
clean up industrial waste or monitor patients for the first
signs of disease.
     Already, scientists are producing strings of man-made DNA,
short for deoxyribonucleic acid, which directs the functions of
all living cells. Then they splice the manufactured DNA into the
genes of existing organisms, reprogramming bacteria to act like
microscopic factories churning out biofuels.
     Venter's experiments are taking synthetic biology a step
further by working to build new organisms from the ground up
with wholly artificial genes.

                          `Coolest Stuff'

     ``It's the coolest stuff of my career,'' Venter says in his
office at the J. Craig Venter Institute in Rockville, Maryland.
``We can go from 15 years of reading the genetic code to now
maybe harnessing that information for the betterment of
mankind.''
     Venter, 61, who rocked the scientific world in 2000 by
mapping the collection of human genes in record time, is no
stranger to big ideas -- or to controversy.
     In 2002, he was ousted as president of Celera Genomics,
which he helped start to decode the human genome, after the
board decided to concentrate on drug development instead of
selling genetic data. Later that year, Venter revealed on CBS's
60 Minutes II that his own genes made up most of Celera's
database.
     Venter's plan to use synthetic genes to create man-made
life offers the most headline-grabbing potential to date. That's
opening up Venter to suggestions of grandstanding.
     ``You can win in business in multiple ways: You can either
make a product, or you can make something that sizzles -- that
seems like a product,'' Harvard Medical School genetics
professor George Church says. Church is a co-founder of LS9 Inc.
in San Carlos, California, which plans to use modified E. coli
bacteria to convert plant matter into a gasolinelike fuel.

                   Single-Celled Refineries

     Re-engineered microorganisms may inherit all sorts of jobs.
For now, top gene researchers are particularly excited about the
potential for energy-producing microbes that may become single-
celled refineries for ethanol, biodiesel or other petroleum
substitutes without using food crops such as corn.
     Scientists are forming bioenergy companies with money from
some of the same venture investors who once backed computer and
Internet startups.
     ``It's a huge, huge market, and at $100 oil, with the
climate crisis and our geopolitical situation, it's the right
market to go after,'' says Samir Kaul, a partner at Khosla
Ventures in Menlo Park, California. Khosla Ventures, run by Sun
Microsystems Inc. co-founder Vinod Khosla, is backing Church's
LS9 and other synthetic biology companies.
     Venter has founded a company called Synthetic Genomics Inc.
to design microbes that make fuel from plant matter, carbon
dioxide and sunshine, or convert underground coal into a more
easily extracted gas.

                      $100 Billion Industries

     The energy market is so much larger than biopharmaceuticals
that there's room for a plethora of blockbuster products, he
says.
     ``With fuel, we're hoping there could be a hundred to a
thousand different unique solutions,'' Venter says, wearing blue
jeans and a sport shirt in an office crowded with awards,
mementos and sailing memorabilia. ``Each one could be a $100
billion industry on its own.''
     Synthetic biology's potential stems from life's vast array
of single-celled organisms. Many of them already perform
valuable tasks, such as fermenting grain into alcohol.
     ``The reason biology is cool to me is that I look at all
the things it can physically make,'' says Drew Endy, a
biological engineering professor at Massachusetts Institute of
Technology in Cambridge. ``The list goes on and on and on and
on.''
     Synthetic biology builds on the more than three decades of
genetic engineering behind trailblazing biotechnology companies
such as Amgen Inc. and Genentech Inc.

                           Gene Splicing

     The science, also called gene splicing, typically involves
transplanting a single gene from one cell into another to
produce a particular protein, says Jay Keasling, a chemical
engineering professor at the University of California, Berkeley.
In synthetic biology, scientists implant a series of genes
designed to work together, like stations along a biological
assembly line.
     ``It's one thing to throw a gene into a cell,'' Keasling
says. ``We're talking about putting in genetic circuits that
will allow us to coordinate many different processes
simultaneously.''
     Genes from one type of microbe that digests wild grasses,
for example, may be combined with those from another organism
that excretes ethanol.
     Instead of using actual genes plucked from other cells,
scientists can create those genetic circuits to spec using the
chemicals that make up DNA's four-letter molecular alphabet. The
chemicals are commonly called by their initials: A for adenine,
C for cytosine, G for guanine and T for thymine.

                         DNA Synthesizers

     Scientists feed the four ingredients in the desired order
into DNA synthesizers. The machines are generally about the size
of a laser printer and are studded with small bottles.
     The ingredients mix with chemicals that make the molecules
join into relatively short strings, says John Mulligan, chairman
of Blue Heron Biotechnology Inc., a Bothell, Washington-based
company that sells synthetic DNA. The short strands are
chemically linked into longer chains, which are joined into
double-stranded DNA and copied, Mulligan says.
     ``We can go from completely inert bottles full of powder --
for A, C, G and T -- dissolve them in an organic solvent and
make long strings of DNA,'' Church says. ``We put that into a
cell, where it basically produces whatever you want it to
produce.''
     There are various ways to get the DNA into a microbe. The
genetic material can pass through a cell wall, with laboratories
such as Venter's orchestrating millions of individual
microscopic reactions at once. Or the genes can hitch a ride on
a virus that infiltrates bacteria.

                        Where's the Money?

     Microbes packed with custom-designed genes may be able to
make all sorts of things; nobody has shown they can make money.
And creating a cell from scratch, as Venter is trying to do, is
many years away, says UC Berkeley's Keasling.
     ``Far down the road it's going to be a very powerful
technology,'' he says. ``It's going to be a while before
something like that is at all practical.''
     An older generation of drug-oriented biotech firms,
squeezed by research costs and long product approvals, has
suffered persistent losses even with investors' initial
enthusiasm. When South San Francisco, California-based Genentech
went public in 1980, its shares soared to $88 from $35 in less
than an hour, a record at the time.
     Through 2006, 30 years after Genentech was formed, U.S.
publicly traded biotech companies as a group had never
celebrated an annual profit, according to estimates from the
Boston-based Ernst & Young Global Biotechnology Center. In 2006,
336 U.S. public biotech companies lost a combined $3.5 billion
on revenue of $55.5 billion, falling short of the $59.5 billion
in sales at Target Corp. stores that same year.

                       Scientific Exploits

      Human Genome Sciences Inc., a company Venter helped start
in 1992 to find commercial uses for discoveries at his nonprofit
research lab, lost money in 36 consecutive quarters through
Sept. 30. Showing the hazards of DNA-based investing, Human
Genome Sciences hasn't had a drug product reach the market since
its debut.
     All the same, Venter has gained celebrity for scientific
exploits such as decoding human DNA in a virtual tie with the
U.S. government's Human Genome Project, which had an eight-year
head start.
     The son of two ex-Marines, Venter was devoting his time to
surfing Southern California's beaches before he enlisted for a
three-year stint in the Navy in 1965. He spent a year as a
medical aide in Vietnam, where watching the life-or-death
struggles of wounded soldiers made him decide to study medicine
after his discharge in 1968.
     While a student at the University of California, San Diego,
Venter shifted to medical research. He earned his bachelor's
degree in biochemistry there in 1972 and his doctorate in
physiology and pharmacology in 1975.

                        Teaching, Research

     The next year, Venter moved to Buffalo, New York, to teach
pharmacology and biochemistry at the State University of New
York. Eight years later, he took a job at the National
Institutes of Health, which is based in the Washington suburb of
Bethesda, Maryland. He did research into faster and cheaper
methods of reading DNA, a field that was exploding.
     When leaders of the Human Genome Project refused to use
some of Venter's techniques, he left the NIH in 1992 to start
his own lab, the Institute for Genomic Research. Investors led
by Wallace Steinberg, founder of HealthCare Investment Corp. in
Edison, New Jersey, financed both the institute and Human Genome
Sciences.
     In 1998, Perkin-Elmer Corp., now called Applera Corp.,
recruited Venter to start Celera Genomics, which it listed the
next year as a tracking stock. Norwalk, Connecticut-based
Applera also owns Applied Biosystems Group, a manufacturer of
gene-sequencing equipment used in Venter's genome project.

                         `Science Fiction'

     The human gene-mapping project made Venter one of the
world's best-known scientists. USA Today placed him fourth in
its September ranking of the 25 most influential people from the
past 25 years, behind Bill Gates, Ronald Reagan and Oprah
Winfrey and just ahead of Osama bin Laden.
     Venter says today's body of genetic knowledge is growing so
fast that biology likely will dominate 21st-century science and
technology, just as discoveries in physics revolutionized the
past 100 years.
     ``It's exciting to think that life is very different than
we might have imagined -- that it's not so complex at some
levels, that we can design it and build it,'' Venter says.
``These are things from science fiction.''
     Synthetic biology's ability to stretch the imagination may
not be all blessing. The Sept. 11, 2001, attacks and the
anonymous anthrax mailings the same year introduced American
society to a heightened threat of terrorism. Today, teenagers
with science fair projects can browse Internet databases for the
DNA sequences needed to make a novel microbe.
     ``Engineered biological agents could be worse than any
disease known to man,'' the U.S. Central Intelligence Agency
said in a 2003 report.

                         Public Perception

     ``The whole sci-fi end of this is the part that, from a
public-perception point of view, is going to be the big threat
to synthetic biology,'' says Kathy Hudson, director of the
Washington-based Genetics and Public Policy Center.
     In debates about scientific or ethical limits on synthetic
biology, Hudson says, it's important to avoid extreme viewpoints
from enthusiasts promising the impossible or doomsayers
predicting the apocalypse.
     ``On the benefits side, you can't put on pompoms too early
and oversell things. On the risk side, keep it as real as you
can.''
     Still, some early entrants are expecting big things from
the embryonic industry as researchers rush to start companies
and venture capitalists hustle to fund them.
     ``It's equivalent to building the first transistor,'' says
Juan Enriquez, chief executive officer of Biotechonomy LLC, a
Boston investor in Venter's Synthetic Genomics. ``It changes
fundamentally the rules of the game across a whole series of
industries.''

                         Made-to-Order DNA

     Harvard's Church, MIT's Endy and UC Berkeley's Keasling
started Codon Devices Inc. in Cambridge to sell made-to-order
synthetic DNA and related services. Investors, led by
Cambridge's Flagship Ventures, have contributed $33 million in
two rounds of venture funding.
     Venter started Synthetic Genomics in 2005 with gene
researcher and longtime collaborator Hamilton Smith, who won the
Nobel Prize in medicine in 1978. In October 2005, the company
sold $30 million of preferred stock to 12 investors in the U.S.,
according to a Securities and Exchange Commission filing.
     It's raised more money abroad. In June, BP Plc, Europe's
second-biggest oil company, bought an unspecified stake as part
of a research venture to study microbes living in coal and oil
fields. Venter says he's investigating ways to engineer microbes
to make hydrocarbons more environmentally friendly.

                          `A Young Field'

     Another of Keasling's synthetic biology startups, Amyris
Biotechnologies Inc. in Emeryville, California, has raised $90
million since October 2006. It's working on plant-based gasoline
and diesel fuel substitutes.
     Amyris is also teaming up with UC Berkeley to create
microbes to produce low-cost artemisinin, an anti-malarial drug
that's too expensive for wide use in poor countries. That effort
is backed by a $42.6 million grant from the Bill & Melinda Gates
Foundation. ``This is a very young field,'' Venter says. ``There
are a lot of startup companies. There's a lot of money floating
around.''
     The hubbub around synthetic biology evokes an earlier era
in Silicon Valley. And some young companies are drawing money
from the same VCs that backed high-profile computer and Internet
firms.
     Khosla Ventures is funding Amyris and Codon Devices in
addition to LS9. Menlo Park-based Kleiner Perkins Caufield &
Byers is backing Codon Devices. Kleiner partner John Doerr,
known for his early support of Amazon.com Inc. and Google Inc.,
is on the Amyris board.

                     `Renaissance in Learning'

     Steve Jurvetson, managing director of Draper Fisher
Jurvetson in Menlo Park, is a Synthetic Genomics director. A
foundation headed by Intel Corp. co-founder Gordon Moore has
given more than $15 million to Venter's nonprofit institute
since 2004.
     Jurvetson says synthetic biology is taking computing's
place as the cutting edge of technology. ``There's a huge
renaissance in learning that's going on in life sciences that's
bringing some of the techniques and approaches we've used in
information theory,'' says Jurvetson, an original investor in
Hotmail Corp., the email service provider Microsoft Corp. bought
in 1997. ``It's as if we're finally able to decipher and re-
engineer the code of life.''
     Analogies linking synthetic biology with computing aren't
just superficial comparisons. Cells get marching orders from
sequences of DNA's four chemical letters, just as computers take
direction from programs written in strings of ones and zeros.
     ``It's like a computer language, but it's base four instead
of base two,'' says Chad Waite, who invests in biology companies
as a managing director at OVP Venture Partners in Kirkland,
Washington.

                         Genetic Software

     Once scientists decipher the sequence of A's, C's, G's and
T's in a gene and determine what that gene does, they can write
genetic software instructing cells -- the hardware -- to perform
a desired function. ``Life turns out to be in perfectly
transmitted code,'' Enriquez says.
     Like digital computer coding, DNA's letter combinations can
be copied and shared. At MIT, Endy helped start a public
database of DNA sequences called the Registry of Standard
Biological Parts. Researchers can download DNA recipes showing
how to build genes from various organisms.
     Endy is also president of the BioBricks Foundation. The
Cambridge-based organization promotes so-called BioBrick parts,
whose uniform features let the genetic pieces fit together like
Lego blocks.
     BioBrick-type specifications can cut research costs and
spur innovation because they create a dependable set of
components, says Noubar Afeyan, CEO of Flagship Ventures.
``They're applying fundamental engineering principles to
thinking about interchangeable parts and standard protocols,''
says Afeyan, who's also chairman of Codon Devices.

                          Darwin's Voyage

     Synthetic biology's engineering potential is only as good
as the inventory of biological building blocks. Venter added to
the cache on an expedition he compared with Charles Darwin's
voyage on the HMS Beagle in the 1830s. In research supported by
Moore's foundation and the U.S. Department of Energy, Venter
spent time in 2003 and '04 on a 95-foot sailing sloop, the
Sorcerer II.
     His team collected water samples every 200 miles (320
kilometers) between Nova Scotia and Tahiti to find
microorganisms whose genes might fit into useful combinations
for transplant into a cell. ``We published a single paper with 6
million new genomes, more than doubling the number of known
genes,'' Venter says.
     Discoveries of new genes, from microorganisms that survive
in hostile environments, are giving synthetic biologists
potentially powerful genetic tools for designer microbes.

                         Extreme Microbes

     ``We have organisms that can grow under extreme pressure,
extreme temperatures, extremes of pH, extremes of radiation,''
he says. ``We can't do any of those things. But if we can
harness the power of those that can, it gives us a very
different potential for the future.''
     Some environmentalists, fearing potential damage from
microbes never seen in nature, are questioning Venter's plans.
ETC Group, a Canadian public-interest organization pressing for
government regulation of synthetic biology, has mocked Venter's
proposed man-made microbe with the nickname ``Synthia.''
     Venter and his research partners want to make their
customized microbe with the smallest number of genes required to
keep it alive. Like an automobile chassis, the stripped-down
organism could act as a frame, supporting strands of synthetic
DNA designed to produce chemicals or digest pollutants, Venter
says.
     ``We have to understand the minimal cell to understand and
build correctly the next phases,'' says Venter, who has applied
for patents on a bacteria with a minimum complement of genes. He
has tentatively picked a name for his minimalist microbe:
Mycoplasma laboratorium. The name signifies bacteria built in
the lab.

                           `Tough Dude'

     Church questions whether Venter's approach makes sense.
Existing bacteria, such as E. coli, probably make better
starting points for synthetic biology work, he says.
``Mycoplasma is notoriously frail,'' he says. ``If I were to
pick a chassis, an organism to produce biofuels, it would be a
robust, tough dude. It would not be some wimpy guy.''
     Keasling says Venter's goal of making a custom-designed
cell as a foundation for synthetic engineering is too distant to
be practical. And it's not even necessary. People die of malaria
every day for want of the artemisinin his company, Amyris, is
working to produce.
     ``We can't wait for a synthetic cell that might have all of
the traits we want,'' Keasling says.
     Kaul, at Khosla Ventures, isn't surprised Venter is taking
the engineering of synthetic DNA to the extreme by designing his
own man-made organism.

                         `Next Big Thing'

     ``Craig is always pushing the frontiers of biology,'' says
Kaul, who was a biochemist at Venter's Institute for Genomic
Research before moving to venture capital. ``He's always on to
the next big thing. When he puts his mind on something, it's
always going to be pretty exciting.''
     While debate simmers inside the scientific community, the
political, ethical and moral concerns targeting genetically
modified crops and stem cell research aren't yet impeding
synthetic biology research. The field is too new.
     ``It's still under the radar,'' says Jim Thomas, research
program manager at ETC. ``We're at a very early stage in terms
of people being aware of this.''
     Sooner or later, something is likely to happen to put
synthetic biology in the spotlight. Thomas has a pretty good
guess what that will be: ``The interesting turning point is
going to be when Craig Venter announces Synthia, his synthetic
organism. That's going to take a lot of people by surprise.''

                         Potential Dangers

     Thomas says Synthia and custom-designed organisms like it,
which have never been exposed to nature, will open a new realm
of potential dangers. Regulators will need to rule out
environmental threats before the microbes go to work outside a
lab, he says.
     ``You're building it entirely from scratch, so there's no
reference point,'' he says. ``Nobody really has an ability yet
to work out how to assess the safety.''
     The risk of unanticipated dangers from unfamiliar
microorganisms stoked fears in the 1970s with the birth of gene
splicing. Cambridge, now a hotbed of synthetic biology work at
Harvard and MIT, banned genetic engineering within the city
limits. Researchers observed an ad hoc moratorium until a
scientific conference in 1975 established safety guidelines.
     Similar concerns may have to be addressed with synthetic
biology, OVP's Waite says. ``There are going to be a lot of
ethical issues we have to crawl through,'' he says.
     The Washington-based Center for Strategic & International
Studies, MIT and the Venter Institute released a 55-page report
in October describing potential synthetic biology safeguards,
from distribution of bio-safety manuals to registration of DNA
synthesizers.

                           No Incidents

     Genetic engineers have shown they can work safely after a
generation's worth of experience and no damage from rogue
microbes, Venter says. ``We've had 30 years and tens of millions
of experiments -- all that have worked without incident,'' he
says.
     The Internet is changing synthetic biology's equation. In
2002, researchers from what is now Stony Brook University, part
of the New York state university system, managed to make a
synthetic, infectious poliovirus. They downloaded its genetic
blueprint from a Web site and ordered the DNA from a commercial
lab.
     DNA do-it-yourselfers browsing eBay in November could
choose from a half dozen used DNA synthesizers for as little as
$199 plus shipping. A secondhand Pharmacia Gene Assembler Plus
model was selling for $995, while the owner of an Applied
Biosystems 394 wanted $1,000. On its Web site, Codon Devices
recently advertised gene synthesis for as little as 69 cents per
pair of DNA letters with a minimum order of synthetic DNA.

                         `Brave New World'

     Companies that make synthetic genes have self-imposed
guidelines requiring them to investigate orders and reject
requests for DNA sequences that could be misused. ``It's not
that people are oblivious to safeguards,'' Codon Devices' Afeyan
says. ``The concerns are shared by people in the industry.''
     Oversight is growing in importance as the pace of discovery
picks up. ``The tools that are being developed are improving
exponentially,'' Endy says. ``The parts collection is doubling
every year; the cost of synthesis is dropping by a factor of two
every year.''
     Better technology speeds research and makes inventions
possible that wouldn't have been feasible a few years ago, Endy
says.
     Just as integrated circuits spread beyond computing to
become ubiquitous -- they're used to program dishwashers and are
implanted in dogs as identity tags -- it's hard to fathom what
lies ahead. ``You're going to see synthetic biology deployed in
many surprising places,'' he says.
     If synthetic DNA works as envisioned, one expected step is
for research to move beyond single-celled organisms to
engineered plants and animals.
     ``We're entering a brave new world, where every year is
going to feel a bit like future shock, and the pace of change is
only going to accelerate,'' Jurvetson says.
     It should be no surprise that Venter is looking beyond M.
laboratorium, his first swipe at a man-made organism, to
projects approaching the frontiers of knowledge. Along the way,
he and other future-oriented geneticists will have to clear
hurdles in the lab and in the marketplace before synthetic
biology can produce real profits -- and deliver on its promise.

--Editor: Gail Roche, Charles Siler

To contact the reporter on this story: Bob Drummond in
Washington at +1-202-624-1838 or This e-mail address is being protected from spam bots, you need JavaScript enabled to view it

To contact the editor responsible for this story: Jonathan
Neumann at +1-609-394-0737 or This e-mail address is being protected from spam bots, you need JavaScript enabled to view it

Related Items:

• Archbishop of Canterbury calls for new law to punish 'thoughtless or cruel' words
• Atheist sees image of Big Bang in Piece of Toast
• Churchgoing on its knees as Christianity falls out of favour
• How Evolution REALLY Works
• Local council in shock challenge to Catholic dogma