This Engineered Salmon Could Double World Production: Should You Fear Frankenfish?

Genetically modified Atlantic salmon, trout, tilapia, and shrimp will soon be coming to a dinner plate near you. Photo: Hans-Petter Fjeld, Creative Commons.

If you thought the seafood section of your local grocery store offered a refuge from genetic modification techniques commonly used in agricultural crops, I have some bad news for you.

AquaBounty Technologies, now owned by synthetic biology company Intrexon (NYSE: XON  ) , has developed an engineered Atlantic salmon named AquAdvantage Salmon that matures twice as fast as conventional salmon. Aquaculture may not be on your investing radar, but the global industry is valued at over $100 billion and is the fastest growing segment of the worldwide food industry. Genome editing technologies promise to expedite the growth further -- and they will arrive sooner than you think. The U.S. Food and Drug Administration is poised to approve the aquaculture company's product for marketing next year, which would open the regulatory door for engineered trout, tilapia, and shrimp being developed by the two companies.

You may not like the idea of altering the genetic code of more complex organisms -- especially those that end up on your dinner plate -- instead preferring the technology sticks to simpler microorganisms being developed by synthetic biology companies such as Amyris (NASDAQ: AMRS  ) and Solazyme (NASDAQ: SZYM  ) . However, enhanced aquaculture technologies present impressive growth opportunities and environmental advantages for investors and consumers. Is the technology safe? Are the advantages real and measurable? How long until biotech fish stare back at you from your own dinner plate? Let's swim through the possibilities.

How do you safely make a biotech fish?
It's actually quite simple. AquaBounty introduced one gene from a Pacific Chinook salmon into its AquAdvantage Salmon, or AAS, to allow it to grow to full market size in half the time. Despite the hastier maturity profile, AAS produce the same amount of growth hormone as conventional salmon. A molecular switch (called a "promoter") from an antifreeze protein gene was also integrated into the fish genome, although AAS do not produce antifreeze protein. Additionally, all AAS will be sterile females; ensuring there will be no gene flow to wild populations if they escape production facilities.

Engineered fish will undoubtedly encounter some backlash from consumers -- with Whole Foods Market already stating it would ban them from its stores -- but the U.S. Food and Drug Administration announced that they were safe to eat in 2010. Moreover, considering that Atlantic salmon hold roughly 40,000 genes -- compared to about 24,000 genes for humans -- only 0.0025% of the genome has been altered. Aside from growth, there are no discernable differences between AquaBounty's engineered product and a wild Atlantic salmon.

Nonetheless, that single genetic change results in a giant gain in productivity. It's important to note that AAS do not grow larger than wild Atlantic salmon -- they simply grow to full size more quickly. Take a look at how they compare to their conventional counterparts:

AAS will be harvested near the 550-day mark. Source: AquaBounty Technologies.

AquaBounty can grow the same amount of fish in half the time (or less) while adding substantial environmental benefits with no additional risks. But are the advantages tangible?

Advantages of biotech fish
Although Intrexon played no role in developing AquAdvantage Salmon, the companies are exploring ways to utilize synthetic biology to develop even better products with more efficient production profiles. If you think of traditional genetic engineering -- crops and essentially all genetically engineered commercial products created to date -- as the first, most basic form of genome editing, then synthetic biology -- or utilizing the building blocks of life to assemble novel technologies -- represents the next big leap. Either way, both can offer real and measurable advantages.

For instance, synthetic biology pioneer Amyris stormed onto the scene by engineering yeast to create artemisinic acid, which can be transformed into artemisinin -- one of the most potent anti-malarial compounds on the planet. The medicine is traditionally harvested in plants, but agricultural methods have produced widely variably global stockpiles in recent years. Price jolts have kept it out of reach of the world's poorest in bad harvests and threatened to lead to its overuse and resistance in good harvests. Luckily the biomanufacturing process, licensed to Sanofi in 2008 with commercial production beginning last April, has already begun stabilizing world stockpiles and price.

As the pharmaceutical giant uses synthetic biology to produce one-third of the world's annual artemisinin crop in bioreactors, Amyris is focusing on developing novel molecules for fuels, chemicals, cosmetics, and fragrances with other engineered yeast strains. Meanwhile, Solazyme is altering heterotrophic algae strains (those that grow on sugar rather than sunlight) to produce renewable oils for fuels, chemicals, cosmetics, and nutraceuticals. In fact, Solazyme should have a global operating capacity of more than 120,000 metric tons of renewable products by mid-2015.

SZYM Chart

SZYM data by YCharts

The important takeaway is that both technology platforms offer substantial reductions in land mass requirements compared to traditional agricultural methods for obtaining natural products and tremendous environmental benefits compared to products sourced from petroleum. Intrexon and AquaBounty may be altering fish, but the benefits are much the same.

AquaBounty has a 100 metric ton-per-year land-based facility in Panama that will begin producing AAS once the FDA grants approval, hopefully in early 2014. That's not even a drop in the bucket compared with the annual global aquaculture opportunity for Atlantic salmon of 230,000 metric tons. However, approval would allow for more AAS farms to be constructed (each requiring FDA approval) worldwide. Why focus on land-based farms?

Although AAS won't be able to transfer genes to wild populations of fish (they're sterile), building aquaculture farms with geographic barriers offers additional benefits that go far beyond gene flow risks. A land-based farm would significantly reduce the risk of transferring disease from farm-raised fish -- a more frequent occurrence with aquaculture -- to natural populations. Additionally, coastal regions would not be overrun with commercial aquaculture operations and could capture economic benefits from higher value industries. Farms could also be located near major consumer markets, which would reduce environmental impacts resulting from transportation. That means residents of Austin, Texas, could theoretically eat locally produced salmon. Imagine that!

Fear the Frankenfish?
While Amyris and Solazyme are developing industrial biotechnology platforms that depend on the optimization of select microorganisms to produce industrial chemicals, investors and consumers should realize that the potential of synthetic biology extends far beyond single-celled organisms. If AquaBounty can successfully navigate to the end of its 18-year regulatory journey and raise additional capital in the second quarter of 2014 (likely from Intrexon) for commercial deployment, then AquAdvantage salmon will probably begin making their way to dinner plates by 2015. You would have a difficult time finding them in stores, but they would be the first major commercial product for Intrexon, which consolidates the company's financial statements into its own.

If you're willing to roll the dice that a growing world can't live without the next generation of aquaculture technologies, then Intrexon would be a great buy-and-hold investment for any portfolio (it's far from the only product in development). Nonetheless, there is no reason to fear engineered salmon. The advantages are simply too big to ignore or write off because of ignorance.

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Read/Post Comments (14) | Recommend This Article (8)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 05, 2014, at 5:07 PM, duuude1 wrote:

    How does it taste? If it tastes good and costs less, I'm good with it!

    How will AquaBounty (Intrexon) make $$?

  • Report this Comment On January 05, 2014, at 6:51 PM, bigdamdog wrote:

    lets eat!!.

  • Report this Comment On January 05, 2014, at 10:19 PM, DannyBoy13 wrote:

    Sounds like Jurassic Park.

    "You were so impressed that you could! you never stopped to consider whether you should..."

  • Report this Comment On January 05, 2014, at 10:52 PM, CrankyOldGuy wrote:

    They are focusing on a high-priced fish, for the rright reasons, but ought to be considering applying the technique to tuna. The world needs alternative food supplies (or birth control....)

  • Report this Comment On January 05, 2014, at 11:17 PM, DevonShire123 wrote:

    You shouldn't fear frankenfish unless you fear becoming sterile or growing tumors. If that's the case, then you should be very afraid.

  • Report this Comment On January 06, 2014, at 1:06 AM, GeorgePolitico02 wrote:

    The problem is simple arithmetic: there is more demand for fish protein than the ocean can supply. Either prices must go way up or we must find something else. Where I live, a 15-oz can of salmon already costs more than $4. Fish is generally healthier than red meat, and as a diabetic I wish I could return to the days of cheap salmon.

    We have 7 billion people on this planet now, and unfortunately, we are heading toward 11 billion. If we want to avoid disaster we cannot afford to be governed by medieval fears about genetic alchemy. Each potential GMO should be evaluated on its individual merits, and if found to be safe, should be approved.

    In the meantime there is some good news: AquaBounty's salmon will be grown in inland pools, far from the oceans. It will not steal food from dolphins, will not contain mercury and other toxins that are all too common in the ocean, and AquaBounty will never drown any dolphins in its fish nets.

    As soon as it is approved--if it is--I will order $1000 worth.

  • Report this Comment On January 06, 2014, at 5:35 AM, DickHamilton wrote:

    I wouldn't have a problem eating them, but if they get out, they will very soon take over (they grow twice as fast, and twice as big) and there will be no more real natural salmon, sea trout, etc

  • Report this Comment On January 06, 2014, at 8:17 AM, TMFBlacknGold wrote:

    @DickHamilton

    The AquAdvantage Salmon cannot reproduce, as they are sterile. Additionally, studies have shown that 85% of farm raised fish caught in the wild (after escaping enclosures) did not have food in their stomachs. They aren't able to capture wild food as well as wild salmon.

    Maxxwell

  • Report this Comment On January 06, 2014, at 10:49 AM, greenknight32 wrote:

    In their trials, they failed to achieve 100% sterile fish, and fish are known to change sex, especially under stress. Growing them in crowded enclosures is stressful for the fish. We can't rely on their inability to reproduce.

  • Report this Comment On January 06, 2014, at 11:08 AM, TMFBlacknGold wrote:

    @greenknight32

    I've read to the contrary. In fact, each batch of fish is tested for sterility before they are grown for production. I suppose there can be cases where a fertile fish escapes to the wild, but the environmental consequences are overblown.

    First, larger fish are bigger targets for other predators. Second, a lot would have to go right for the genes to flow to wild populations in adequate amounts for them to survive. Third, reference my comment above to @DickHamilton.

    The rewards greatly outweigh the risks.

    Maxxwell

  • Report this Comment On January 06, 2014, at 11:11 AM, TMFBlacknGold wrote:

    @DevonShire123

    Your comments are not based upon any scientific conclusions arrived at to date. Please do not spread fear from behind your keyboard.

    Maxxwell

  • Report this Comment On January 06, 2014, at 5:12 PM, stockanal45 wrote:

    Sushi bars all over the world are celebrating!!! More salmon produced = Less cost per salmon

    Now, if they can do the same for Blue Fin Tuna, I will be impressed! (For those of you who are sushi ignorant, the fatty part of tuna, called toro, is the filet mignon of the fish.) At authentic Japanese sushi bars, two pieces can cost up to $40!

  • Report this Comment On January 15, 2014, at 6:48 PM, ScottAtlanta wrote:

    My brother grew twice as fast and twice as big...but I outsmarted him, I did...and I'm alive! Do you hear me? ALIVE!

    Oh, we're talking about salmon? Nevermind.

  • Report this Comment On January 15, 2014, at 6:53 PM, ScottAtlanta wrote:

    But on a serious note...aren't farm-raised fish plagued with problems whether GMO or not? Due to for example, overcrowding, stress, need to apply antibiotics, etc.? Are there documented healthy fish farming conditions?

    If so....then perhaps the GMO Fish will fly.

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